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Exhibit 10
September 30, 1997
Xx. Xxxxxx X. Xxxxxx
0000 Xxxxx Xxxxx Xxxxx
Xxxxxxxxx, XX 00000
Dear Xxx:
This letter confirms the substance of our recent conversations wherein you
agreed to a mutual separation effective December 31, 1997. Rockwell
International, and its successor, Meritor, (collectively as "Rockwell") agree to
provide you the following:
1. You will continue in your present position through December 31, 1997.
2. Beginning January 1, 1998 and continuing for the 27 months ending March 21,
2000, you will remain on the Rockwell payroll and be paid $21,667 per
month. During this time, you will continue to earn credited service which
will be used to calculate pension benefits. Your compensation checks will
be mailed to your home unless you specify otherwise. Please advise us in
writing if you change your address.
3. On October 1, 1997 you will receive a closure payment of $100,000. There
will be no stock options granted to you associated with the spin-off.
4. You will receive ICP payments for fiscal years ending 1998 and 1999. Such
payments will be made under the applicable formulas, and awards will not
exceed 150% of target.
5. You will receive Long Term Incentive Plan (LTIP) payments for FY1996-98 and
FY1997-99 plan years as follows:
- FY1996-98 LTIP will be paid in cash in December, 1998, pending Board of
Directors approval, based on Light Vehicle Systems performance measured
against the applicable plan formulas.
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Xx. Xxxxxx X. Xxxxxx
September 30, 1997
Page 2
FY1997-99 LTIP will be terminated and you will receive a cash payment
for the FY1997 portion of this plan in January, 1998. You will also
receive Meritor stock options equivalent to the remaining portion (FY
1998 and 1999), adjusted to present value, in January, 1998. These
options will have a special two year cliff vesting period. Actual
FY1997 performance, along with forecasted FY1998 and 1999 performance
will be used to determine the overall Light Vehicle Systems performance
to be measured against the applicable plan formulas.
6. You will retain your Company sponsored country club membership until such
time as you relocate from the Detroit area but not later than March 31,
2000. At that time, the membership will revert back to Rockwell.
7. Your present Company vehicle may be replaced with a 1998 model which may be
driven at Company expense until December 31, 1998, at which time you may
purchase it at its book or wholesale value, whichever is less.
8. You will continue to be provided financial counseling assistance until
March 31, 2000.
9. Medical and dental coverage will remain in force through March 31, 2000.
10. Short and long term disability coverage will continue through December 31,
1997.
11. You will be eligible to continue to participate in the Company savings plan
through March 31, 2000. If you wish to receive information concerning your
options, contact the Savings Plan Administration Center at 800/269-7600.
In consideration of the above, you agree to consult with Xxxxxxxx'x senior
executives in areas of commercial interest to the company. Such services might
include, for example, providing industry insight and knowledge or developing
access to key customer executives and markets. The consultation shall be
performed from time-to-time on an as needed basis at the discretion of Rockwell,
which would, of course, cover the appropriate expenses involved in your travel
and associated assignments. You also agree as follows:
1. You will keep confidential and not disclose to any person other than your
spouse and/or your accountant or attorney the existence of this agreement,
its substance or any discussions or information relating to it. If asked
you will simply state that all matters have been resolved. You will not
make disparaging remarks concerning the Company or its employees.
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Xx. Xxxxxx X. Xxxxxx
September 30, 1997
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You agree to and hereby release and waive any and all claims and rights you
may have or believe you may have against Xxxxxxxx, its successors, assigns,
officers, directors, employees or agents relating to or arising out of your
employment or your separation including any claim or right in contract,
tort and based on or arising under any federal or state statutes, including
the Age Discrimination in Employment Act. This agreement does not extend to
your rights under any retirement benefit plan of Rockwell or other future
rights.
2. Xxxxxxxx shall have the right to terminate this agreement at any time if
you breach any of the obligations stated herein under this agreement.
3. You acknowledge that you have been advised to consult with an attorney
prior to signing this agreement. You also acknowledge, understand and agree
that this agreement is voluntarily entered into by you in consideration of
the undertakings by Xxxxxxxx as set forth herein and is consistent in all
respect with the discussions by Rockwell personnel with you relating to
your separation.
4. This agreement is a complete and final agreement between Rockwell and you
and supersedes all other offers, agreements and negotiations except for the
Invention Assignment Agreement which remains in full force.
5. You understand that you have 21 days within which to consider this
agreement, and that you may revoke the agreement within 7 days of signing
it. However, the agreement will not become effective until the revocation
period has expired.
Sincerely,
/s/ Xxxx Xxxxxxx
Xxxx X. Xxxxxxx
Senior Vice President
Human Resources
ACCEPTED AND AGREED TO:
/s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx
Date: Oct. 1, 1997
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