Separation Agreement November 1, 2007
DURA Automotive
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Operating Headquarters | 0000 Xxxxxxxx Xxxxx | Tel. (000) 000-0000 | |||||
Systems, Inc.
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and Technology Center | Rochester Hills, MI 00000-0000 | Fax (000) 000-0000 |
![(DURA LOGO)](https://www.sec.gov/Archives/edgar/data/1016177/000095012407005750/k21486k2148600.gif)
Separation Agreement
November 1, 2007
Xx. Xxxx X. Xxxxxxxxxxxxx
0000 Xxxxx Xxxxx
Xxxxxxxxxx Xxxxx, XX 00000
0000 Xxxxx Xxxxx
Xxxxxxxxxx Xxxxx, XX 00000
Dear Xxxx:
Please allow this letter to serve as the entire agreement (the “Agreement”) between
Dura Automotive Systems, Inc. (the “Company”) and you, Xxxx X. Xxxxxxxxxxxxx (the
“Employee”), with respect to certain aspects of the termination of your employment with the
Company.
Effective Date
This Agreement is effective as of the date the Company obtains Bankruptcy Court authorization
to enter into this Agreement (the “Effective Date”).
Recitals
Whereas, the Employee was an employee of the Company and served as Vice President of the
Company through the earlier of the Effective Date and
November 1, 2007;
Whereas, the Company determined that the Employee will no longer serve as Vice President, as
of the earlier of the Effective Date and November 1, 2007; and
Whereas, the Company is currently operating as a debtor-in-possession under chapter 11 of the
United States Code (the “Bankruptcy Code”), with its cases currently pending before the
United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”).
Duration
As of the earlier of the Effective Date and November 1, 2007, the Employee will cease to be
employed by the Company. The terms of this Agreement shall remain in effect from the Effective Date
through November 1, 2008, or the date that is twelve months after the Effective Date, whichever is
later (the “Duration”).
The Duration of this Agreement may be modified only by mutual agreement of the Company and the
Employee, evidenced by written confirmation of same.
Payments
To the extent permitted by an order of the Bankruptcy Court. | |||
Accrued Vacation Pay | |||
(i) | The Company shall pay to the Employee an amount equal to the accrued, but unused, vacation time the Employee earned during his employment with the Company. For avoidance of doubt, Employee’s accrued vacation time is eight weeks as of November 1,2007, and shall be paid in a lump sum of approximately $43,366.92 (before taxes and other deductions) (the “Accrued Vacation Pay”), within 5 days of the Bankruptcy Court’s approval of this Agreement, which is an amount equal to Employee’s regular salary for that period of time. | ||
Non-Compete Consideration | |||
(ii) | The Company shall pay the Employee, in consideration for the Employee’s assent to and performance under the non-competition, non-disparagement, non-solicitation and confidentiality provisions herein, a one-time payment of $125,000 (the “Non-Compete Consideration”) within 5 days of the Bankruptcy Court’s approval of this Agreement. | ||
Deferred Compensation Payment | |||
(iii) | Employee shall also receive payment in full of amounts owed pursuant to his participation in the Debtors’ 401(k) Non-Qualified Deferred Compensation Plan (the “Deferred Compensation Payment”). The Deferred Compensation Payment will be determined as of the date the Bankruptcy Court enters an order approving this Agreement and is expected to be in the approximate amount of $215,985.33. |
Non-Competition; Non-Disparagement; Non-Solicitation
For the Duration, the Employee will not directly or indirectly: | |||
(i) | Become employed by, consult for, provide or arrange financing for, or own any interest in, any company that is in the same business or substantially the same business as the Company and its affiliates and is a direct competitor of the Company or its affiliates (a “Competing Business”); provided, however, that Employee may own not more than five percent of any class of publicly-traded securities of any legal entity engaged in a Competing Business. | ||
(ii) | Participate in any manner in the Chapter 11 bankruptcy cases involving the Company; provided, however, that, consistent with item (i) above and with his confidentiality obligations under this Agreement, Employee may be employed by parties with an interest in the Company’s chapter 11 cases so long as his duties do not involve the Company, whether directly, indirectly or otherwise; provided further that the prospective employer affirmatively screens him from any and all matters involving the Company or its chapter 11 cases during the Non-Compete Period. |
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For the Duration, the Employee will not directly or indirectly, make any oral or written
statement or publication with respect to the Company or its affiliates or any stockholders,
directors, officers, employees, lenders or their respective affiliates, which disparages or
denigrates, or could reasonably be interpreted as, disparaging or denigrating, the Company or any
of its affiliates or any stockholders, directors, officers, employees, lenders or their respective
affiliates. This section shall not apply to testimony given under oath in any legal or
administrative proceeding.
For the Duration, the Company’s officers will not directly or indirectly, make any oral or
written statement or publication with respect to the Employee, which disparages or denigrates, or
could reasonably be interpreted as, disparaging or denigrating, the Employee. This section shall
not apply to testimony given under oath in any legal or administrative proceeding.
For the Duration, Employee shall not directly or indirectly through another person or entity
(other than in the ordinary course of Employee’s employment with the Company or any of its
affiliates (the “Affiliates”)) (i) induce or attempt to induce any employee of the Company or any
Affiliate to leave the employ of the Company or such Affiliate, or in any way interfere with the
relationship between the Company or any Affiliate and any employee thereof (provided, nothing
herein shall prohibit normal general advertising), (ii) hire any person who was an employee of the
Company or any Affiliate at any time during the twelve month period immediately preceding the date
of the intended hire or (iii) induce or attempt to induce any customer, supplier, licensee,
licensor or other business relation of the Company or any Affiliate to cease doing business with
the Company or such Affiliate, or in any way interfere with the relationship between any such
customer, supplier, licensee, licensor or other business relation and the Company or any Affiliate
(including, without limitation, making any negative or disparaging statements or communications
regarding the Company or its Affiliates).
If, at the time of enforcement of these non-competition, non-disparagement and
non-solicitation provisions, a court shall hold that the duration, scope or area restrictions
stated herein are unreasonable under circumstances then existing, the parties agree that the
maximum duration, scope or area reasonable under such circumstances shall be substituted for the
stated duration, scope or area and that the court shall be allowed to revise the restrictions
contained herein to cover the maximum period, scope and area permitted by law. Employee
acknowledges that the restrictions contained in these non-competition, non-disparagement and
non-solicitation provisions are reasonable and that Employee has reviewed the provisions of this
Agreement with Employee’s legal counsel.
In the event of the breach or a threatened breach by Employee of any of the provisions of
these non-competition, non-disparagement and non-solicitation provisions, the Company would suffer
irreparable harm, and in addition and supplementary to other rights and remedies existing in its
favor, the Company shall be entitled to specific performance and/or injunctive or other equitable
relief from a court of competent jurisdiction in order to enforce or prevent any violations of the
provisions hereof (without posting a bond or other security). In addition, in the event
of a breach or violation by Employee of these non-competition, non-disparagement and
non-solicitation provisions which is finally determined by a court of competent jurisdiction, the
Non-Compete Period shall be automatically extended by the amount of time between the initial
occurrence of the breach or violation and when such breach or violation has been duly cured.
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Employee’s obligations pursuant to these non-competition, non-disparagement and
non-solicitation provisions shall terminate in the event that the Company is in breach of its
obligation to pay the Non-Compete Consideration due herein; provided that the Company shall be
given prior written notice of any such breach and shall be given up to five business days after
receipt of such notice to cure such breach of its payment obligation.
Confidential Information
In the performance of Employee’s duties as a former officer and employee of the Company,
Employee was brought into frequent contact with, had, or may have had access to, and became or may
have become informed of confidential and proprietary information of the Company and information
that is a trade secret of the Company, or otherwise confidential (collectively, “Confidential
Information”). Employee acknowledges and agrees that the Confidential Information was or will
be developed by and/or for the Company through the substantial expenditure of time, effort and
money and constitutes valuable and unique property of the Company.
Employee will keep in strict confidence, and will not, directly or indirectly, at any time,
disclose, furnish, disseminate, make available, use or suffer to be used in any manner, any
Confidential Information of the Company without limitation as to when or how Employee may have
acquired such Confidential Information; provided, however, that the foregoing shall not preclude
Employee’s disclosure of Confidential Information pursuant to, or as required by, law, subpoena,
judicial process or to any governmental agency in connection with any investigation or proceeding
of such agency. Employee specifically acknowledges that Confidential Information includes any and
all information, whether reduced to writing (or in a form from which information can be obtained,
translated, or derived into reasonably useable form), or maintained in the mind or memory of
Employee and whether compiled or created by the Company, which derives independent economic value
from not being readily known or ascertainable by proper means by others who can obtain economic
value from the disclosure or use of such information, that reasonable efforts have been put forth
by the Company to maintain the secrecy of Confidential Information, that such Confidential
Information is and will remain the sole property of the Company, and that any retention or use by
Employee of Confidential Information after the termination of Employee’s employment by the Company
will constitute a misappropriation of the Company’s Confidential Information.
Employee’s obligation of confidentiality under this section will survive, regardless of any
termination or other breach of this Agreement or any other agreement, by any party hereto, unless
and until such Confidential Information of the Company has become, through no fault of the
Employee, generally known to the public or the Employee is required by law (after providing the
Company with notice and the opportunity to contest such requirement) to make such a disclosure.
Employee’s obligations under this section are in addition to, and not in limitation or preemption
of, all other obligations of confidentiality, which Employee may have to the Company under the
Company’s policies, general legal or equitable principles or statutes, and which will remain in
full force and effect following the Effective Date.
Upon the earlier of the Effective Date and November 30, 2007, Employee shall deliver to the
Company all memoranda, notes, plans, records, reports, computer files, disks and tapes,
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printouts
and software and other documents and data (and copies thereof) embodying or relating to
Confidential Information or the business of the Company or any Affiliates which Employee may then
possess or have under Employee’s control.
Waiver of Claims
In exchange for the Non-Compete Consideration, Xxxxxxxx agrees to waive all claims against the
Company, including, but not limited to: (i) his filed proofs of claim designated as claim numbers
3056, 3057, 3119, 3551, 3552, and 3553; and (ii) any claims related to the termination of his
employment with the Company.
Miscellaneous
This Agreement contains the entire agreement between the parties with respect to the matters
contained herein, superseding any prior oral or written statements or agreements, specifically:
Employee’s entitlement to salary, severance, vacation time or payment for unused vacation time,
and payment for his non-competition, non-disparagement, non-solicitation and confidentiality
covenants.
The
Employee may not assign or delegate any of his rights or obligations
under this Agreement
without first obtaining the written consent of the Company.
In the event tile Company is requested to provide details of Employee’s employment or
termination of that employment, the Company will indicate that the Company and Employee have
severed their relationship, and the Company will furnish a letter of reference substantially in the
form of attached Exhibit “A” to this Agreement.
The Company will permit Employee and his counsel to prior review and approval of any motion
filed by the Company with the Bankruptcy Court seeking approval of this Agreement, and any proposed
order submitted to the Court for entry on the same subject.
The terms of this Agreement are severable and may not be amended except in a writing signed by
the parties. If any portion of this Agreement is found to be unenforceable, the rest of this
agreement will be enforceable except to the extent that the severed provision deprives either party
of a substantial portion of its bargain.
This Agreement will be governed by and construed in all respects in accordance with the laws
of the State of Michigan, without giving effect to conflicts-of-laws principles.
Each person signing below is authorized to sign on behalf of the party indicated, and in each
case such signature is the only one necessary.
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All notices or other communication described under this Agreement shall be in writing and shall be
given by hand delivery to the other party or by registered or certified mail, return receipt
requested, postage prepaid, addressed as follows:
If to the Employee:
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If to the Company: | |
Xx. Xxxx X. Xxxxxxxxxxxxx
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Dura Automotive Systems, Inc. | |
0000 Xxxxx Xxxxx
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Attn: Xxxxxxx Xxxxxx | |
Bloomfield Hills, MI 48301
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0000 Xxxxxxxx Xx. | |
Rochester Hills, MI 48309 |
[Nothing further on this page]
Please sign below and return a signed copy of this letter to indicate your agreement with its terms
and conditions.
Sincerely yours, | Acknowledged and agreed by: | |||||
Dura Automotive Systems, Inc. | Xxxx X. Xxxxxxxxxxxxx | |||||
By: | /s/ Xxxxxxx Xxxxxx | /s/ Xxxx X. Xxxxxxxxxxxxx | ||||
Signature | (Signature) | |||||
Names: | Xxxxxxx Xxxxxx | Xxxx X. Xxxxxxxxxxxxx | ||||
Title: | Vice President | (Print name) | ||||
Date:
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11-2-07 | Date: | 11-2-07 |