EXHIBIT 10(B)
SEPARATION AGREEMENT
This Separation Agreement ("Agreement") is made and entered into this 28th
day of August, 1998, by and between Xxxxxx X. Xxxxx ("I", "Me", or "My" as the
case may be) and X.X. Xxxxxx Company, a Minnesota corporation, with offices at
0000 Xxxxxx Xxxx Xxxxxxxxx, X.X. Xxx 00000, Xx. Xxxx, Xxxxxxxxx 00000-0000 and
all of its divisions, subsidiaries, affiliates, and all of its agents, officers,
employees, directors, and shareholders (hereinafter collectively "Xxxxxx"):
WHEREAS, Xxxxxx and I have determined that it would be in our mutual best
interests if I voluntarily resigned from My employment.
NOW, THEREFORE, in consideration of the promises, agreements and covenants
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby expressly acknowledged, the undersigned hereby
agree and promise as follows:
1. RECITALS. The foregoing recitals are hereby incorporated as if fully set
forth herein.
2. LEAVE OF ABSENCE. On or before December 31, 1998, I will resign from My
position as Senior Vice President Operations, and I will commence a paid Leave
of Absence, during which time I will perform consulting duties for Xxxxxx, as
requested. The Leave of Absence shall continue until October 31, 2000, at which
time I agree to voluntarily resign from My employment with Xxxxxx. I understand
and acknowledge, however, that My employment with Xxxxxx may be earlier
terminated by reason of My death, or for willful misconduct detrimental to the
interests of Xxxxxx, including but not limited to, any violation of the
obligations I have undertaken in Paragraphs 10, 11, 12 or 13 of this Agreement.
During the Leave of Absence, I am free to work outside of Xxxxxx, provided I do
not violate paragraphs 10, 11, 12, or 13 of this Agreement and provided such
work does not conflict with my obligation hereunder to perform consulting
duties. During the Leave of Absence, I agree to keep Xxxxxx informed of any
position I accept outside of Xxxxxx and My eligibility for employment benefits.
I freely and knowingly enter into this Agreement.
3. SALARY CONTINUATION. I will continue to be paid at My current salary
rate of $12,447.98 (less state and federal taxes and other legal standard
deductions) on a semi-monthly basis until termination of My employment.
4. BENEFITS CONTINUATION. Except as otherwise stated herein, Xxxxxx agrees
to continue to provide coverage under the employment benefits programs in which
I am currently enrolled, but only to the extent such benefits continue in
existence, until termination of My employment. I further understand and agree
that benefits may be
continued only to the extent permitted by the terms of the applicable plan or as
permitted by applicable law, and may, at Xxxxxx'x election, be discontinued to
the extent I become eligible to received other similar or conflicting benefits
from an employer other than Xxxxxx. I am not waiving any rights to vested
employee benefits extended under Xxxxxx plans.
5. RETIREMENT BENEFITS. The last date of My credited service with Xxxxxx
will be the date of termination of My employment. I understand that My rights to
benefits under Xxxxxx'x Retirement Plan, Supplemental Executive Retirement Plan
And Retiree Medical Plan are governed and determined by the rules of said plans.
Pursuant to the terms of the Supplemental Executive Retirement Plan, Xxxxxx
agrees to make, to Me, additional, supplemental, semi-monthly payments, of
$706.25 (less state and federal taxes and other legal standard deductions) until
such time as I reach age 62. Thereafter, and until My death, Xxxxxx agrees to
make, to Me, additional, supplemental, semi-monthly payments under the
Supplemental Executive Retirement Plan in the amount of $161.90 (less state and
federal taxes and other legal standard deductions). These supplemental payments
shall be in addition to, and not in substitution for, the ordinary benefits
which I am to receive under the Supplemental Executive Retirement Plan by virtue
of My credited service with Xxxxxx.
6. PAID TIME OFF BENEFIT. I hereby agree to waive and forfeit the value of
all Paid Time Off benefit which I have accrued through the date of this
Agreement. I further agree that I will accrue no additional Paid Time Off
benefit during the Leave of Absence.
7. BONUS PAYMENT. I understand and agree that My 1998 bonus to paid January
15, 1999 will be in the amount of $83,650.43, and that I am not eligible to
receive, and will not be paid, any bonus for fiscal year 1999 or any period
thereafter.
8. STOCK RETENTION WAIVER. Any retention requirements on the restricted
stock I have received to date, pursuant to Xxxxxx'x stock grant program will be
waived effective the date of termination of My employment, as permitted by law.
However, in the event My employment is terminated for any reason other than
death or voluntary resignation, the retention requirements will not be waived
until I have executed a second release, in the form set forth in paragraph 13,
reaffirming My release of all claims through the date of termination, and until
the applicable recision period has expired.
9. COMPANY CAR. The title to the automobile currently provided to Me by
Xxxxxx shall be transferred to My name, without cost to Me, on the date of
termination of My employment or upon My acceptance of a position outside of
Xxxxxx, whichever occurs sooner. However, I understand that I am solely
responsible for paying any income and other taxes as a result of this transfer.
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10. CONFIDENTIAL INFORMATION.
a. EMPLOYEE OBLIGATION. I agree that, from and after the date this
Agreement is executed by both parties, I will hold in strict confidence and will
not reveal or disclose to anyone other than family members, spouse or
significant other, attorneys, accountants, tax consultants, or as may be
required by law or court process, any information, facts or occurrences relating
to the negotiations leading to this Agreement, the existence of this Agreement,
or the contents of this Agreement. Furthermore, I agree that, from and after the
date this Agreement is executed by both parties, all the information, facts, or
occurrences relating to formulas, processes, customer lists, computer user
identifiers and passwords, and all purchasing, engineering, accounting,
marketing and other information, not generally known and proprietary to Xxxxxx,
relating to research, development, manufacturing, marketing or sale of Xxxxxx'x
products shall be and are hereby deemed to be confidential information
("Confidential Information") of the parties to this Agreement. I agree, from and
after the date this Agreement is executed by both parties, not to use or
disclose any Confidential Information at any time during or after My employment
by Xxxxxx, except in the performance of My duties on behalf of Xxxxxx, or by
written consent of Xxxxxx or as may be required by law or court process. From
and after the date this Agreement is executed by both parties, I agree that all
Confidential Information, including all copies, excerpts and summaries in My
possession or control (whether prepared by Xxxxxx, Myself or others), as well as
all other Xxxxxx property not transferred herein, shall be immediately returned
to Xxxxxx.
b. EMPLOYER OBLIGATION. Xxxxxx agrees that, from and after the date this
Agreement is executed by both parties, it will hold in strict confidence and
will not reveal to anyone other than Xxxxxx executive management personnel,
human resources personnel, attorneys, accountants, tax consultants, or as may be
required by law or court process, any information, facts or occurrences relating
to the negotiations leading to this Agreement, the existence of this Agreement,
or the contents of this Agreement. I recognize that Xxxxxx may be required, by
law, to disclose some or all of the terms of this Agreement in one or more
annual proxy statements to shareholders
11. NON-COMPETITION. For the period of January 1, 1999 through December 31,
2000, I will not serve, directly or indirectly (individually) or as an officer,
director, employee, consultant, partner or co-venturer, or as a stockholder or
other proprietor owning a beneficial interest of more than five percent (5%)) in
any enterprise which is competitive in any manner with any business at the time
carried on by Xxxxxx, without the written consent of Xxxxxx. This means, by way
of illustration but not limitation, that I will not sell or solicit orders for
any "Conflicting Product" to or from any customer whose account I supervised or
serviced for Xxxxxx, and that I will not serve any organization or person
engaged in the development, production or sale of "Conflicting Product." For the
purposes of this illustration, "Conflicting Product" means any product, process,
equipment, concept or service (in existence or under development) of any person
or
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organization which resembles or competes with a product, process, equipment,
concept or service upon which I may have worked or concerning which I acquired
confidential information at any time through My work with Xxxxxx.
I understand that this covenant is not intended to limit My subsequent
employment in any industry or for any employer producing a product or service
different from Xxxxxx'x. I acknowledge and represent that I have substantial
experience and knowledge such that I can readily obtain employment which does
not violate this covenant.
12. NON-SOLICITATION. For the period of January 1, 1999 through December
31, 2000. I agree that I will not induce, attempt to induce, or in any way
assist or act in concert with any other person or organization in inducing or
attempting to induce any employee or agent of Xxxxxx to terminate such employee
or agent's relationship with Xxxxxx. During such period of time, I agree that I
will not make any offers of employment or assist or act in concert with any
other person or organization in making offers of employment to any person who,
at the time of such offer, is currently in an employment or agency relationship
with Xxxxxx. This Agreement shall not be construed to restrict Me from hiring or
offering employment or work to any individual who was an employee or agent of
Xxxxxx prior to the time I hire or offer employment or work to such individual.
13. RELEASE. In consideration of the promises, agreements and covenants
contained herein, I, on behalf of Myself, My heirs, assigns, spouses,
representatives, and agents do hereby fully release and forever discharge
Xxxxxx, from any and all liability, remedies, claims for relief, demands,
actions, causes of action, suits, grievances, arbitrations and administrative
proceedings under every local, state, or federal law, statute, ordinance or
common-law, and any and all other claims of any kind or nature whatsoever
occurring as of the date of this Agreement, whether in law or in equity,
contract or tort, known or unknown, asserted or unasserted, suspected or
unsuspected, of any kind or nature whatsoever which I may now have or hereafter
have or claim to have against Xxxxxx for, upon, or by reason of any matter,
event, cause or thing occurring prior to the date of this Agreement, including
without limitation, any and all claims of any kind arising out of or in anyway
relating to My employment with Xxxxxx, and further including without limitation:
(i) Any claims, demands, or causes of action arising under, or any claim
for relief on the basis of, an alleged violation of the Civil Rights Act of
1991, Title VII of the Civil Rights Act of 1964, the Age Discrimination In
Employment Act of 1967, as amended, the Employee Retirement Income Security Act,
Title 00 X.X. Xxxxxxx 0000, the Americans With Disabilities Act, the Older
Workers Benefit Protection Act, the Minnesota Human Rights Act, and/or any other
federal, state or local statute, ordinance, or regulation dealing in any way
with employment or employment discrimination;
(ii) Any claims, demands, or causes of action on the basis of any breach of
an express or implied employment contract under the common-law of the State of
Minnesota, or any other state, or on the basis of any claim of defamation,
wrongful
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discharge and/or any other common-law, statute or tort or any other claim
whatsoever arising out of or in any way relating to My employment with Xxxxxx or
any other occurrence prior to the date of this Agreement, but excluding claims
which I cannot by law waive and claims for breach of this Agreement.
I warrant that I am legally competent to execute this Release and accept full
responsibility therefore. I also agree that I am signing this Release
voluntarily and with full knowledge of its significance and legal consequence. I
ALSO AGREE THAT I HAVE BEEN ADVISED TO CONSULT WITH ANY ATTORNEY BEFORE SIGNING
THIS AGREEMENT AND THAT XXXXXX HAS GIVEN ME A FULL TWENTY-ONE (21) DAYS WITHIN
WHICH TO CONSIDER THIS AGREEMENT, BEFORE SIGNING BELOW, IF I SO DESIRE.
I have read and understand Minnesota Statutes Section 363.031 (copy attached). I
understand that I may rescind (that is, cancel) this Agreement within seven (7)
calendar days of signing it to reinstate claims under the Age Discrimination In
Employment Act of 1967 and within fifteen (15) calendar days to reinstate claims
under the Minnesota Human Rights Act. To be effective, My rescission must be in
writing and delivered to Xxxxxx in care of the Vice President of Human
Resources, 0000 Xxxxxx Xxxx Xxxxxxxxx, X.X. Xxx 00000, Xx. Xxxx, Xxxxxxxxx
00000-0000. If delivered by mail, such rescission may be postmarked within the
seven (7) or fifteen (15) day period, respectively, and sent by Certified Mail,
Return Receipt Requested to X.X. Xxxxxx Company at 0000 Xxxxxx Xxxx Xxxxxxxxx,
X.X. Xxx 00000, Xx. Xxxx, Xxxxxxxxx 00000-000, attention Vice President of Human
Resources.
I UNDERSTAND THAT TIMELY RESCISSION OF ANY PORTION OF THIS AGREEMENT AS PROVIDED
HEREIN, SHALL CONSTITUTE A MATERIAL BREACH OF THIS AGREEMENT RESULTING IN
IMMEDIATE WITHDRAWAL AND RESCISSION OF ALL PROMISES, AGREEMENTS AND COVENANTS
CONTAINED HEREIN.
14. REMEDIES. I acknowledge that the provisions of this Agreement are
reasonable and necessary for the protection of Xxxxxx and that My violation of
this Agreement will cause Xxxxxx irreparable harm for which it will be entitled
to temporary and permanent injunctive relief, money damages insofar as they can
be determined and all related costs and reasonable attorneys' fees.
15. JURISDICTION AND VENUE. This Agreement shall be governed by the laws of
the State of Minnesota and I hereby consent to the jurisdiction and venue of the
courts of the State of Minnesota for the resolution of any disputes arising out
of, or related to, this Agreement, including breach and formation (fraud), to
the exclusion of the courts of any other state.
16. INTEGRATION AND MODIFICATION. Except as provided herein, this Agreement
represents the entire Agreement between Me or anyone who has or obtains any
legal rights or claims through Me and Xxxxxx with respect to the subject matter
covered herein. It replaces any other oral or written agreements,
representations,
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promises or discussions between Me and Xxxxxx. This Agreement may not be changed
orally. To be valid, any waiver or modification must be in writing and signed by
all of the parties hereto. If any part of this Agreement is declared by a court
of competent jurisdiction to be illegal, invalid or unlawful, in whole or in
part, then said part shall be modified or suspended, as the case may require,
but only to the extent necessary and all other parts will remain valid and in
full force and effect. This Agreement may be executed in any number of
counterparts which, taken together, shall constitute but one Agreement. A copy
of this Agreement is as valid as the original.
THIS IS A FINAL AGREEMENT AND RELEASE. READ BEFORE SIGNING.
Dated: August 28, 1998 X.X. XXXXXX COMPANY
By: /s/ Xxxxx X. Xxxxx
--------------------------------
Its: Vice President-Human Resources
Dated: August 28, 1998 /s/ Xxxxxx X. Xxxxx
--------------------------------
Xxxxxx X. Xxxxx
0000 Xxxx Xxxxxx Xxxx Xxxxx
Xxxx Xxxxx, XX 00000
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