Exhibit 10.3
May 23, 2001
Delivered By Hand
-----------------
Xx. Xxxx X. Xxxxx
Dear Xxxx:
This letter confirms our discussion last week during which you voluntarily
resigned from your employment as Senior Vice President, Chief Financial Officer
and Secretary of Glenayre, effective May 23, 2001 (the "Resignation Date") on
the terms and conditions set forth in this letter agreement. Glenayre and you
mutually agree that your Employment Agreement with Glenayre dated April 27, 2000
(the "Employment Agreement") is terminated and of no further force or effect,
effective as of the Resignation Date, and that the benefits provided to you
under this letter agreement are in lieu of any and all benefits under the
Employment Agreement.
1. Resignation. You hereby resign from your employment with any of the
-----------
Glenayre Companies (defined in Paragraph 7 below) and resign from all
offices, committees and positions you hold with the Glenayre Companies and
any affiliated company, including but not limited to your position as
Senior Vice President, Chief Financial Officer and Secretary of Glenayre,
with said resignation to be effective on the Resignation Date. If requested
by Xxxxxxxx, you will execute any additional resignation letters, forms or
other documents which acknowledge your resignation from such employment,
positions, committees and offices.
2. Services. So long as you receive severance payments under Paragraph 4
--------
below, you agree to be available on reasonable notice and at reasonable
times to provide services to Glenayre in connection with financial or other
matters. In this connection, you will act as an independent contractor and
not as an employee of Glenayre.
3. Accrued Salary and Benefits. You will be paid all salary and benefits to
---------------------------
which you are entitled through the Resignation Date. You will be paid for
your accrued but unused vacation as of such date.
4. Payments after the Resignation Date (the "Special Exit Package"). On or
----------------------------------------------------------------
prior to June 1, 2001, you will receive one lump sum payment equal to
$285,000. You will also receive additional severance benefits in the form
of bi-weekly
payments of $10,961.54 each (up to a maximum amount of $142,500) until the
earlier of (i) the expiration of six months after the Resignation Date or
(ii) such time as you accept employment from another company. The foregoing
payments shall be made in accordance with Glenayre's payroll practices and
shall be subject to all applicable withholding as an employee.
5. Benefits Following the Resignation Date. After the Resignation Date and so
---------------------------------------
long as you receive severance payments under Paragraph 4 above, you and
your dependents will continue to be eligible to participate in Glenayre's
medical plan at current employee rates, which may be revised from time to
time. Once such severance payments cease, you may continue your individual
and dependent coverage through COBRA at rates which are evaluated annually.
After the Resignation Date, you shall cease to be covered by all vacation
and holiday leave programs, the 401(k) Retirement Savings Plan, the
Employee Stock Purchase Plan, short and long-term disability, Life and
AD&D, and you shall cease to be entitled to any perquisites or benefit
rights not expressly covered by this letter agreement.
You have been granted options to purchase Glenayre's common stock. You
agree that all such options expire on the Resignation Date, except that
options for 75,000 shares granted to you on March 30, 2001 will become
immediately vested on the Resignation Date and you will have a period of
one year after the Resignation Date in which to exercise any of such vested
options.
6. No Recruitment of Employees. You agree not to recruit, provide information
---------------------------
on any personnel of the Glenayre Companies (defined in Paragraph 7 below),
or assist another employer in the recruitment of any employee of the
Glenayre Companies within two years after the Resignation Date.
7. Release. In consideration for receipt of the Special Exit Package, which
-------
you specifically acknowledge to be sufficient consideration to support this
release, you hereby release and discharge Glenayre Technologies, Inc.,
Glenayre Electronics, Inc. and their predecessors, successors, and
affiliates, successors, assigns and benefit plans (collectively, the
"Glenayre Companies") and their respective directors, officers,
shareholders, trustees, administrators, employees, representatives and
agents from any and all claims or liabilities of whatever kind or nature,
known or unknown, which you have ever had or which you now have, including
but not limited to, claims arising out of your employment with any of the
Glenayre Companies or the termination of your employment, whether based on
tort, contract (express or implied) or any state or federal
2
wage, employment or common laws. This release does not, however, apply to
any obligations of Glenayre under this letter agreement.
8. Confidential Information. You agree that you will keep strictly
------------------------
confidential and will not disclose, directly or indirectly, any document or
information (including all proprietary, confidential, or trade secret
information of the Glenayre Companies, that you have had in your possession
or of which you were/are aware) relating to your employment with any of the
Glenayre Companies or to the business and operations of any of the Glenayre
Companies. You further agree that you will not make any statement nor take
any action which might adversely reflect upon any of the Glenayre
Companies, or any of their officers, directors or employees. Likewise,
Glenayre and its directors and officers will not make any statement nor
take any action which might adversely reflect upon you.
9. Remedies for Breach. You acknowledge and agree that in the event of a
-------------------
breach by you of the provisions of Paragraph 6 (No Recruitment of
Employees) or Paragraph 8 (Confidential Information), Glenayre may, in
addition to whatever other rights and remedies it may have at law or in
equity, withhold any amounts or benefits otherwise payable or due under
Paragraphs 3 and 4 of this letter agreement.
10. Acknowledgment of Understanding and Voluntariness. You acknowledge that you
-------------------------------------------------
understand completely everything set forth in this letter agreement, that
you have had ample opportunity to review this letter agreement and all its
ramifications with an attorney of your own choosing, and that you have
entered into this letter agreement voluntarily, without any coercion
whatsoever, of your own free will, and that you intend legally to be bound
by this letter agreement.
11. Entire Agreement. This letter agreement constitutes the entire agreement
----------------
between Glenayre and you with respect to the subject matter hereof. This
letter agreement will not be construed as an admission of liability,
wrongdoing, or discrimination by any of the Glenayre Companies or any of
their officers, directors, employees or agents.
12. Severability. If any provision hereof shall be determined to be
------------
unenforceable, such fact shall not invalidate or render unenforceable any
other provision hereof.
13. Binding Effect. This letter agreement shall be binding upon and inure to
--------------
the benefit of the parties hereto and their respective heirs, personal
representatives, successors and assigns, as the case may be.
3
14. Governing Laws. This letter agreement shall be deemed to have made in the
--------------
State of North Carolina and shall be interpreted, construed, and enforced
in accordance with the laws of the State of North Carolina (without regard
to any conflicts of laws principles).
If the foregoing terms and conditions are acceptable to you, please sign in the
space indicated below.
Sincerely, Accepted and agreed to:
/S/ Xxxx Xxxxxxx /S/ Xxxx X. Xxxxx
------------------------ --------------------------
Xxxx Xxxxxxx Xxxx X. Xxxxx
President and CEO
cc: Personnel File
4
