Exhibit 10.1
THIS AGREEMENT ("AGREEMENT"), made this 22nd day of February, 2002, by
and among XXXXXXXX X. XXXXX ("XXXXX") whose address is 0 Xxxxxxxx Xxxxxx,
Xxxxxxxx, Xxxx Xxxxxxxx 00000, VALLEY NATIONAL GASES, INC., a West Virginia
corporation ("VALLEY") whose address is 00-00xx Xxxxxx, Xxxxxxxx, Xxxx Xxxxxxxx
00000, VALLEY NATIONAL GASES INCORPORATED, a Pennsylvania corporation ("VNGI")
whose address is 0000 Xxxxxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxxxxxx 00000, VALLEY
NATIONAL GASES DELAWARE, INC., a Delaware corporation ("VNGD"), 000 Xxxxxxxx
Xxxxxx, Xxxxx 0000, Xxxxxxxxxx Xxxxxxxx 00000.
WHEREAS, Bandi was President and Director of VALLEY which conducts
business and operations, including especially but not limited to the sale and
distribution of welding supply products, industrial and specialty gases, medical
gases, liquid propane, robotics, fire safety equipment as well as products and
services related thereto ("BUSINESS"); and
WHEREAS, Bandi was President and Director of VNGD which is the parent
corporation of Valley, and Valley is the wholly owned subsidiary of VNGD; and
WHEREAS, Bandi was President, Director and Chief Executive Officer of
VNGI which is the parent corporation of VNGD, and VNGD is a wholly owned
subsidiary of VNGI; and
WHEREAS, Bandi has resigned all of the aforesaid offices and
directorships; and as well, Bandi has resigned and terminated his employment
with Valley, VNGI and VNGD effective as of March 31, 2002, thereby permitting
him to utilize his accrued vacation; and
WHEREAS, notwithstanding Bandi's resignation as aforesaid and
independent thereof, it is the desire of Bandi, Valley, VNGI and VNGD to enter
into this separation Agreement, wherein Bandi agrees to furnish covenants to
Valley, VNGI and VNGD as well as to enter into other agreements set forth herein
for and in consideration of Valley's, VNGI's and VNGD's covenants and agreements
hereunder.
WITNESSETH: That for and in consideration of the payments, covenants
and agreements hereinafter contained and otherwise in the Agreement, Bandi,
Valley, VNGI, and VNGD agree as follows:
1. Incorporation of Recitation ("WHEREAS") Clauses. The recitations and
defined terms set forth hereinabove are incorporated herein by reference and
made part of this Agreement.
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2. Consideration to Bandi.
(a) Cash Payments. As consideration for the "Covenants of
Bandi" under Paragraph 4 and as well for the "General Release and Waiver" under
Paragraph 8.Valley, VNGI and/or VNGD, jointly and severally, shall pay to Bandi
the sum of Sixteen Thousand Six Hundred Sixty-six Dollars and Sixty-six Cents
($16,666.66) each month during the Term of the Agreement, commencing on the 1st
day of April, 2002 and continuing on the 1st day of each and every month
thereafter with the last installment due and payable on the 1st day of March,
2005.
(b) Outplacement Services. Within the first (1st) eighteen
(18) months of the Term of this Agreement, if Bandi elects Outplacement Services
pursuant to Paragraph 6 hereinafter, Valley, VNGI and/or VNGD shall expend on
Bandi's behalf or reimburse Bandi an amount not to exceed Fifteen Thousand
Dollars ($15,000.00) to pay for the cost of Outplacement Services.
(c) Life Insurance. As consideration for the "Release and
Discharge of Rights Under Non-Qualified Retirement Benefit" under Paragraph 6,
Valley shall, as soon as possible after the Effective Date, as defined
hereinafter, assign and transfer to Bandi that certain General American Life
Insurance Co., policy number 3,056,631, with face amount of One Hundred Eighty
Thousand Dollars ($180,000.00), owned by Valley insuring the life of Bandi,
which has an aggregate cash surrender value of approximately Thirty-six Thousand
Dollars ($36,000.00) and which was purchased by the corporation to fund the
corporation's unsecured, general liability under the said non-qualified
retirement benefit arrangement subject of Paragraph 6 hereinafter.
3. Term. The Term of this Agreement shall be for three (3) years,
commencing on the 1st day of April, 2002 and continuing thereafter up and
through and including the 31st day of March, 2005.
4. Covenants of Bandi. Bandi expressly covenants and agrees and with
Valley as follows:
(a) Non-competition. For and during the Term of this Agreement
("RESTRICTED PERIOD"), Bandi shall not, directly or indirectly, within any
county, city, province, parish, or similar geographic area or political
subdivision wherein the Business has been conducted by Valley, VNGI and/or VNGD
("RESTRICTED AREA"), acting alone or with others, or acting as an employee or
agent of any other person, own, manage, operate or control, or participate in
the ownership, management, operation or control of, or be connected with as an
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officer, employee, director, consultant, partner, member, shareholder (except as
a shareholder of VNGI) or otherwise, or have any beneficial interest in, or
assist anyone or any entity in the conduct of, or otherwise compete with Valley,
VNGI and/or VNGD in any business or enterprise similar to or competitive with
the Business.
(b) Non-solicitation of Customers. Except solely with respect
to any business enterprises with which Bandi, may be affiliated as provided for
in the Paragraph 4(d) "Exclusions" hereinafter, Bandi covenants and agrees that
Bandi shall not, during the Restricted Period, directly or indirectly, solicit
any customers who are currently or at any time during the Restricted Period have
been Business customers of Valley, VNGI and/or VNGD nor shall Bandi during the
Restricted Period, directly or indirectly, assist or be employed by any other
party soliciting or accepting such customers.
(c) Non-solicitation of Employees. Bandi further covenants and
agrees that during the Restricted Period he will not, directly or indirectly,
(i) solicit the employment or engagement for his own account or for others to
hire, any employee, or exclusive agent of Valley, VNGI and/or VNGD who is or was
such at any time during the Restricted Period or (ii) induce any employee of
Valley, VNGI and/or VNGD to leave the employ of Valley, VNGI and/or VNGD.
(d) Exclusions. Notwithstanding anything herein to the
contrary, nothing herein shall restrict Bandi from acting in any capacity as an
owner, officer, member, director, shareholder, partner, sole proprietor, agent
or consultant to any business entity, or other form of business enterprise in
connection with such entity's or business enterprise's conduct of business which
does not compete with Valley in a business or enterprise substantially similar
to or competitive with the Business.
(e) Confidential Information. Bandi shall not, directly or
indirectly, disclose, disseminate, use for personal benefit, lecture or write
articles with respect to, or otherwise publish information and know-how
disclosed to or known by Bandi, which information was used, developed or
obtained during and in connection with Bandi in the course of his employment
and/or affiliation with Valley, VNGI and/or VNGD relating to the Business,
including but not limited to the methods of operation and training, customer
lists, pricing as well as any other document or information labeled
"confidential," "proprietary," or words of similar import (collectively
"CONFIDENTIAL INFORMATION"). It is understood that the confidentiality
obligations arising hereunder shall not apply or shall cease to apply to any
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information which is part of the public domain, or which hereafter becomes part
of the public domain through no fault of Bandi; in neither of which instances
shall such information be Confidential Information for the purpose of this
Agreement.
(f) Return of Information. Bandi shall return to or leave with
Valley, VNGI, and VNGD without making or retaining copies thereof, all
documents, records, notebooks, appointment books and similar repositories
containing Confidential Information.
(g) Reasonableness of Covenants. Bandi has carefully
considered the nature and extent of the restrictions upon him and the rights and
remedies conferred upon Valley under this Paragraph 4 and hereby acknowledges
and agrees that given the information to which he has been privy, and the nature
of the Business, the same are reasonable in time and territory, are designed to
eliminate competition which would be unfair to Valley, VNGI and/or VNGD are
fully required to protect the legitimate interests of Valley, VNGI and/or VNGD
and do not confer a benefit upon Valley, VNGI and/or VNGD disproportionate to
any detriment to Bandi. Bandi acknowledges that any breach of his covenants and
agreements under this Paragraph 4 will cause irreparable injury to Valley, VNGI
and/or VNGD.
(h) Remedies. If Bandi breaches any of the covenants and
agreements contained in this Paragraph 4, in addition to any other rights or
remedies of Valley, VNGI and/or VNGD hereunder, Valley, VNGI and/or VNGD shall
have at their or its option, the following specific rights and remedies
enforceable generally in any Court or forum with jurisdiction: (i) the right to
withhold and/or offset any payments or benefits otherwise payable to Bandi
hereunder; (ii) Valley, VNGI and/or VNGD shall have the right to enforce any
legal or equitable remedy (including injunctive relief) that may be available to
Valley, VNGI and/or VNGD; and (iii) Valley, VNGI and/or VNGD shall be entitled
to damages as a result of any such breach. Bandi acknowledges that any breach of
his covenants and agreements under this Paragraph 4 will cause irreparable
injury to Valley, VNGI and/or VNGD.
5. Outplacement Services. Within the first (1st) eighteen (18) months
of the Term of this Agreement Valley, VNGI and/or VNGD shall assist Bandi, in
the procurement of Outplacement Services, as mutually agreeable to Bandi and
Valley, VNGI and/or VNGD, if Bandi elects in writing to commit himself to make a
good faith effort to fully participate in a program of Outplacement Services.
6. Release and Discharge of Rights Under Non-Qualified Retirement
Benefit. Bandi for himself, his heirs, beneficiaries, assigns or executors does
hereby release and
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forever discharge Valley, VNGI and/or VNGD of and from all obligations which
any of them may have, if any, to Bandi arising out of and relating to a certain
non-qualified defined benefit retirement plan and arrangement entered into by
Valley and Bandi.
7. VNGI Stock Options. As additional material consideration for this
Agreement, Bandi and VNGI agree that the termination of Bandi's employment shall
be a termination as provided for in paragraph 9(b)(ii) of the Amendment to
Valley National Gases Incorporated 1997 Stock Option Plan (Effective as of
August 1, 2000) ("AMENDMENT") for a reason other than voluntary termination or
for the reasons listed in paragraphs 9(a) or 9(b)(i)(a) - (g) of the Amendment;
and as such, Bandi shall have a period of three (3) years following such
termination to exercise options that vest prior to or during such period;
provided, however, that any options exercised after the three-month period
following Bandi's termination shall automatically convert to non-Incentive Stock
Options. The Committee, as provided for and defined in Paragraph 4 of the Valley
National Gases Incorporated 1997 Stock Option Plan ("PLAN"), has or will confirm
such termination status. In that regard, Bandi and VNGI agree that Bandi's
rights under the Plan, as amended and restated by the Amendment, with respect to
stock option grants to Bandi are as follows:
Grant Option Grant Vesting Exercise - Exercise -
Date Price Shares Date Begin End
----- ------ ------ ------- ---------- ----------
4/10/97 $8.00 42,000 4/9/00 4/9/00 3/31/05
1/4/99 $5.625 12,600 1/3/02 1/3/02 3/31/05
1/3/00 $3.125 15,750 N/A* N/A* N/A*
1/2/01 $3.75 16,000 1/1/04 1/1/04 3/31/05
* The option grant dated January 3, 2000 was not amended and included in the
terms of the Amendment, and therefore, the terms of the Plan as originally
stated apply; thus, termination of employment, for any reason, causes vesting to
cease. Normal vesting under the Plan would have been January 2, 2003, except for
termination of employment by Bandi prior to that date.
8. General Release and Waiver.
(a) Bandi for himself, his heirs, beneficiaries, assigns or
executors does hereby release and forever discharge Valley, VNGI and/or VNGD
their successors and assigns, as well as any and all of their directors,
officers, agents, representatives and employees from any and all claims, suits,
demands, causes of action, contracts, covenants, obligations, debts, costs,
expenses, attorneys' fees, liabilities of whatever kind or nature, in law or
equity, whether arising by tort, contract, statute or otherwise, whether now
known or unknown, vested or
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contingent, liquidated or unliquidated, suspected or unsuspected, concealed or
hidden, which may exist, have existed or do exist, at any time up to and
including the later date of March 31, 2002, or the Effective Date, as defined
hereinafter. Specifically, but not by way of limitation, Bandi hereby waives and
releases all claims of any kind, which relate in any way to Bandi's employment
with Valley, VNGI and/or VNGD or the termination of that employment, except only
(1) claims arising out of the performance of this Agreement; (2) Bandi's rights
under Valley's, VNGI's and/or VNGD's employee benefit plans except for the
non-qualified defined benefit retirement plan subject of Paragraph 7
hereinabove; and (3) Bandi's rights to compensation earned up through March 31,
2002 including accrued unused vacation and sick leave. Such released claims
include, without in any way limiting the generality of the foregoing language,
any and all claims of employment discrimination or claims otherwise arising out
of Bandi's employment under any local, state or federal common law, statute,
ordinance, rule or regulation, including without limitation, any and all
applicable state Human Rights Acts, state Fair Employment Acts, state Disability
Acts and state Age Discrimination Acts; Title VII of the Civil Rights Act of
1964, as amended; the Civil Rights Act of 1991; the Employee Retirement Income
Security Act, as amended ("ERISA"); the Americans with Disabilities Act of 1990;
as amended ("ADA"); the Age Discrimination in Employment Act of 1964, as
amended, as well as the Age Discrimination in Employment Act of 1967, as amended
("ADEA"). It is the intention of the parties to make this release as broad and
general as the law permits.
(b) In signing this Agreement; Bandi acknowledges that he
intends that the Agreement shall be effective as a bar to each and every one of
the claims hereinabove mentioned or implied. Bandi expressly consents that this
Agreement shall be given full force and effect according to each and all of its
express terms and provisions, including those relating to unknown and
unsuspected claims (notwithstanding any state statue that expressly limits the
effectiveness of a general release of unknown, unsuspected and unanticipated
claims), if any, as well as those relating to any other claims hereinabove
mentioned or implied. Bandi acknowledges and agrees that this waiver is an
essential and material term of this Agreement and without such waiver Valley,
VNGI and VNGD would not have made the promises, covenants and agreements set
forth in this Agreement. Bandi further agrees that in the event, he brings any
claim in which he seeks damages against Valley, VNGI and/or VNGD, or in the
event Bandi seeks to recover against Valley, VNGI and/or VNGD in any claim
brought by a governmental agency on his behalf, this Agreement shall serve as a
complete defense to such claims:
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(c) By signing this Agreement, Bandi acknowledges that he:
(1) has been given twenty-one (21) days after receipt
of this Agreement within which to consider it;
(2) has carefully read and fully understands all
provisions of this Agreement;
(3) knowingly and voluntarily agrees to all of the
terms set forth in this Agreement;
(4) knowingly and voluntarily agrees to be legally
bound by this Agreement;
(5) has been advised and encouraged in writing to
consult with an attorney prior to signing this Agreement; and
(6) understands that he has seven (7) days from the
date he executes and signs this Agreement to revoke it and that this Agreement
shall not become effective or enforceable until the seven (7) day revocation
period has expired ("EFFECTIVE DATE").
9. Agreement to Be Available in Future Proceedings. Bandi agrees to
voluntarily make himself available at reasonable times and with reasonable
notice, without compensation, to Valley, VNGI and/or VNGD and their legal
counsel, at their request, without the necessity of their obtaining a subpoena
or court order, in any investigation, preparation, prosecution and/or defense of
any actual or potential legal proceeding, regulatory action, or internal matter.
Bandi agrees to provide any information reasonably within his recollection.
Valley, VNGI and/or VNGD will reimburse Bandi for his out-of-pocket expenses
actually incurred as a result of Valley's, VNGI's and/or VNGD's requests, or at
Valley's, VNGI's and/or VNGD's option, Valley, VNGI and/or VNGD will arrange to
advance Bandi's expenses or to incur Bandi's expenses directly.
10. No Employment Right or Contract. This Agreement does not constitute
an employment contract, and nothing in this Agreement grants to or creates for
the benefit of Bandi any employment rights, privileges or benefits.
11. Severability of Provisions. If any covenant or agreement set forth
in this Agreement is determined by any court to be unenforceable by reason of
its extending for too great a period of time, or over too great a geographical
area, or by reason of its being too extensive in any other respect, such
covenant or agreement shall be interpreted to extend only for the
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longest period of time and over the greatest geographical area, and to otherwise
have the broadest application, as shall be lawfully enforceable. The invalidity
or unenforceability of any particular provision of this Agreement shall not
affect the other provisions hereof, which shall continue in full force and
effect.
12. Waiver of Breach. The waiver by Valley, VNGI and/or VNGD of a
breach of any provision of this Agreement shall not operate or be construed as a
waiver of any subsequent breach by Bandi. The waiver by Bandi of a breach of any
provision of this Agreement shall not operate or be construed as a waiver of any
subsequent breach by Valley, VNGI and/or VNGD.
13. Assignment and Benefit. Bandi's rights, privileges, obligations and
liabilities under this Agreement are personal, non-transferable and
non-assignable. Valley's, VNGI's and/or VNGD's rights, privileges, obligations
and liabilities under this Agreement shall inure to the benefit of and be
binding upon their respective successors and assigns.
14. Arbitration. Subject to the rights and remedies of Valley, VNGI
and/or VNGD under Paragraph 4(h) hereinabove, any dispute between Bandi and
Valley, VNGI and/or VNGD concerning the terms of this Agreement, including
whether a breach has occurred, will be settled by arbitration in Wheeling, Ohio
County, West Virginia and will be governed by the rules and procedures of the
American Arbitration Association. The costs (exclusive of attorneys' fees) of
arbitration will be equally divided, one-half (1/2) to Bandi and one-half (1/2)
to Valley, VNGI and/or VNGD. The losing party will be solely responsible for
both sides' attorneys' fees, and in the event of a dispute as to the prevailing
party, the arbitrator may determine the party liable for such fees.
15. Entire Agreement. This instrument contains the entire agreement
between the parties. It may not be changed orally but only by an agreement in
writing signed by the party against whom enforcement of any waiver, change,
modification, extension or discharge is sought.
16. Governing Law. This Agreement shall be construed and enforced in
accordance with the laws of the State of Pennsylvania.
[INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date and year first above written.
/s/ Xxxxxxx Xxxx
-------------------------
/s/ Xxxxxxxx X. Xxxxx
----------------------------------------
Xxxxxxxx X. Xxxxx
Executed this 6th day of March, 2002
-------------------------
Valley National Gases, Inc., a West
Virginia corporation
/s/ Xxxxxxxx Xxxxxxxx By /s/ W. A. Xxxxxxxxxx
------------------------- ----------------------------------------
Its Chief Executive Officer
Executed this 26th day of February, 2002
-------------------------
Valley National Gases, Incorporated,
a Pennsylvania corporation
/s/ Xxxxxxxx Xxxxxxxx By /s/ W. A. Xxxxxxxxxx
------------------------- ----------------------------------------
Its Chief Executive Officer
Executed this 26th day of February, 2002
-------------------------
Valley National Gases Delaware, Inc.,
a Delaware corporation
/s/ Xxxxxxxx Xxxxxxxx By /s/ W. A. Xxxxxxxxxx
------------------------- ----------------------------------------
Its Chief Executive Officer
Executed this 26th day of February, 2002
-------------------------
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