Exhibit 10N
RESIGNATION AND RETIREMENT AGREEMENT
THIS RESIGNATION AND RETIREMENT AGREEMENT (this "Agreement"), is made,
entered into and effective as of January 24, 2006 ("Effective Date"), by and
between XXXXX INDUSTRIES, INC. (the "Company"), located at 0000 Xxxxx Xxxx
Xxxxxx, Xxxxx, Xxxx 00000 and XXXXXXX X. XXXXXXXX ("Stodnick"), residing at 0000
Xxxx Xxxx Xxxx, Xxxxxxxxxxx, Xxxx 00000.
WITNESSETH:
WHEREAS, Stodnick is the Vice President - Finance and Chief Financial
Officer (collectively "CFO") of the Company;
WHEREAS, Stodnick has indicated that effective April 25, 2006 ("Resignation
Date"), he will resign from the position of CFO;
WHEREAS, the Company has agreed to accept Stodnick's resignation from the
position of CFO effective as of the Resignation Date;
WHEREAS, the Company desires to utilize the knowledge and skills of
Stodnick after the Resignation Date through June 26, 2007 (the "Consulting
Period"), and Stodnick is in agreement to provide such services as indicated
herein until June 27, 2007 ("Retirement Date"); and
WHEREAS, the Company and Stodnick desire to set forth the services to be
provided by Stodnick and the payments and benefits that Stodnick will be
entitled to receive from the Company in connection with his continued services
and employment with the Company.
NOW, THEREFORE, in consideration of the promises and agreements contained
herein and other good and valuable consideration, the sufficiency and receipt of
which are hereby acknowledged, and intending to be legally bound, the Company
and Stodnick hereby agree as follows:
1. RESIGNATION. Stodnick hereby acknowledges and confirms his resignation,
effective on April 25, 2006, from the position as CFO. Stodnick further resigns,
effective on April 25, 2006, from all other offices of the Company, its
subsidiaries and plans, which he holds or has been appointed. The Company hereby
consents to and accepts the resignations of Stodnick.
2. EMPLOYMENT. From January 24, 2006 until April 25, 2006 ("Transition
Period"), Stodnick will continue in his position as the CFO and as an executive
of the Company. Stodnick agrees that his duties will however reflect a priority
towards the succession training of the replacement chief financial officer.
After April 25, 2006 through June 27, 2007 (the "Consulting Period"),
Stodnick will continue as an employee of the Company and will perform services
and provide such consultations as the President and Chief Executive Officer, or
Chief Financial Officer, may reasonably and specifically request, and shall not
do so if not so requested. Stodnick's position will be considered as a
non-executive, non-policymaking employee of the Company.
3. COMPENSATION AND BENEFITS. In consideration of the promises made by
Stodnick in this Agreement and for the services to be provided by Stodnick to
the Company, and subject to the conditions hereof, the Company agrees to
compensate Stodnick as an employee of the Company as follows:
A. BASE SALARY AND BONUS. During the period from January 24, 2006
until December 31, 2006, Stodnick's base salary as an employee of the Company
will remain at $320,000 per year. Stodnick will be paid a bonus of $145,000 in
March 2006 for fiscal 2005. During the period from January 1, 2007 until June
27, 2007, Stodnick's base salary as an employee of the Company will be $20,000
per year. Stodnick will not receive a bonus payment for fiscal 2006. Stodnick
will be paid the bonus amounts currently accrued for him under the Company's
50/25/25 bonus plan upon the terms of such plan.
B. PAYMENTS. All of the payments under this Paragraph 3 shall be made
in accordance with the Company's normal employment and payroll practices and
subject to applicable payroll tax deductions. Stodnick acknowledges and agrees
that he shall not receive any additional compensation beyond that provided in
this Paragraph 3 for his services to the Company.
C. SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN. Upon his retirement on the
Retirement Date, Stodnick will meet the requirements and shall be deemed to be
fully vested under the Company's Supplemental Executive Retirement Plan
("SERP"), in accordance with the terms of the SERP, which provide for payment of
benefits commencing as of the Retirement Date. Any amounts paid hereunder shall
be subject to applicable payroll tax deductions.
D. MEDICAL COVERAGE. Until the Retirement Date and while Stodnick is
an employee of the Company, the Company will provide coverage under the
Company's health care plan comparable to that provided to the Company's
employees in general (including any dental and prescription coverage) to
Stodnick and his dependents, at the Company's expense, with Stodnick
contributing toward such expense as per similarly situated employees. After the
Retirement Date, for a period of eighteen (18) months, Stodnick may continue his
participation in the Company's employee health care plan pursuant to the
Consolidated Omnibus Budget Reconciliation Act of 1986, as amended ("COBRA")
with such coverage then in effect, whether individual or family.
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E. LIFE, DISABILITY AND LONG-TERM CARE COVERAGE. Until the Retirement
Date and while Stodnick is an employee of the Company, the Company will provide
Stodnick with coverage under the Company's group life and disability insurance
plans comparable to that provided to employees of the Company. Stodnick will be
solely responsible for payment of any participant contributions required in
connection with any election of coverage in the group life, disability or
long-term care insurance plans.
F. MOTOR VEHICLE. Effective on the Resignation Date, the Company will
no longer reimburse Stodnick for the costs and expenses associated with an
automobile.
G. OFFICE SPACE. During the Consulting Period, Stodnick will be
expected to provide his services from a location other than at the Company's
headquarters.
H. RETIREMENT, 401(K), AND PROFIT-SHARING PLANS. Stodnick's
eligibility for benefits, as a past employee of the Company under any of the
Company's retirement, 401(k), or profit-sharing plans for Company employees,
shall be as set forth in the respective plan documents and shall be based on the
date of separation of his employment from the Company.
I. BUSINESS EXPENSES. Stodnick shall continue to be entitled to
reimbursement for business expenses incurred in connection with the performance
of his duties under this Agreement, subject to the Company's policies for
reimbursement.
J. OTHER COMPENSATION AND BENEFITS. Except as specifically set forth
herein, no other compensation or benefits are due Stodnick.
K. NO EFFECT ON RIGHTS TO INDEMNITY. Nothing contained in this
Agreement shall be deemed to constitute a waiver or modification of Stodnick'
rights to indemnification under Ohio law, the Company's governance documents,
the Company's insurance, or under his indemnification agreement.
4. NON-COMPETITION AND RELEASE OF CLAIMS. Effective on the Retirement Date,
the Company agrees to pay to Stodnick $145,000 as consideration for his
execution of a two (2) year non-competition agreement and a release of claims.
A. NON-COMPETITION. The non-competition agreement shall be the current
form used by the Company and shall state that for a period of two (2) years
after the Retirement Date, Stodnick shall not, directly or indirectly, do or
suffer to be done any of the following: own, manage, control or participate in
the ownership, management, or control of, or be employed or engaged by or
otherwise affiliated or associated as a consultant, independent contractor or
otherwise with any other corporation, partnership, proprietorship, firm,
association, or other business entity, or otherwise engage in any business,
which is in competition with the Company's business; provided, however, that the
ownership of not more than one percent of any class of publicly-traded
securities of any entity shall not be deemed a violation of this Paragraph 4.
B. For purposes of the non-competition agreement, the "Company's
business" shall mean any business in which the Company actively engages now or
until the Retirement Date, and any business in which the Company has actively
engaged in the two (2) year period
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prior to the Retirement Date. In the event Stodnick shall violate any provision
of the agreement, then, in such event, such violation shall toll the running of
such time period from the date of such violation until such violation shall
cease.
C. RELEASE OF CLAIMS. The release of claims shall state that Stodnick
for himself and his dependents, successors, assigns, heirs, executors and
administrators releases, dismisses, and forever discharges the Company from, and
agrees to indemnify the Company against, any and all claims (including claims
for attorney's fees), demands, damages, suits, proceedings, actions and/or
causes of action of any kind and every description, whether known or unknown,
which Stodnick has or may have had for, upon, or by reason of any cause
whatsoever (except that this release shall not apply to the obligations of the
Company arising under this Agreement), against the Company.
D. PAYMENT. Notwithstanding anything to the contrary in this
Agreement, Stodnick understands and acknowledges that the Company's obligation
to pay the $145,000 is in consideration for his obligations under Paragraph 4
and is contingent upon Stodnick's execution of these agreements on or about the
Retirement Date.
E. COMPANY. For purposes of the above provisions of this Paragraph 4,
the "Company" shall include its predecessors, subsidiaries, divisions, related
or affiliated companies, officers, directors, stockholders, members, employees,
heirs, successors, assigns, representatives, agents and counsel.
5. CONFIDENTIAL INFORMATION.
X. Xxxxxxxx acknowledges and agrees that in the performance of his
duties as an officer and employee of the Company, he was or may be brought into
frequent contact with, had or may have access to, and/or became or may become
informed of confidential and proprietary information of the Company and/or
information that is a competitive asset of the Company (collectively,
"Confidential Information") and the disclosure of which would be harmful to the
interests of the Company or its subsidiaries.
X. Xxxxxxxx agrees he will keep in strict confidence during the term
of his employment and after the Retirement Date, 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 Stodnick may have acquired such
Confidential Information. At the Retirement Date, Stodnick will immediately
return to the Company (to the extent he has not already returned), equipment,
software, electronic files, computers, including any laptop, in good condition,
all property of the Company, including, without limitation, property, documents
and/or all other materials (including copies, reproductions, summaries and/or
analyses) which constitute, refer or relate to Confidential Information of the
Company. Stodnick further acknowledges that his obligation of confidentiality
shall survive, regardless of any other breach of this Agreement or any other
agreement, by any party hereto.
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6. BREACH. If Stodnick breaches any of the provisions of this Agreement,
then the Company may immediately terminate all remaining payments and benefits
described in this Agreement, plus any expenses and damages incurred as a result
of the breach (including, without limitation, reasonable attorneys' fees), with
the remainder of this Agreement, and all promises and covenants herein,
remaining in full force and effect. The Company will not terminate pursuant to
Paragraph 6 any benefits in which Stodnick had vested as of the Retirement Date
under the Retirement Plans. Stodnick's COBRA rights, if any, will not be reduced
by any action taken by the Company under Paragraph 6.
7. SUCCESSORS AND BINDING AGREEMENT.
A. This Agreement shall be binding upon and inure to the benefit of
the Company and any successor of or to the Company, including, without
limitation, any persons acquiring, directly or indirectly, all or substantially
all of the business and/or assets of the Company whether by purchase, merger,
consolidation, reorganization, or otherwise (and such successor shall thereafter
be deemed included in the definition of "the Company" for purposes of this
Agreement), but shall not otherwise be assignable or delegable by the Company.
B. This Agreement shall inure to the benefit of and be enforceable by
Stodnick's personal or legal representatives, executors, administrators,
successors, heirs, distributees, and/or legatees.
8. NOTICES. For all purposes of this Agreement, all communications provided
for herein shall be in writing and shall be deemed to have been duly given when
delivered, addressed to the Company (to the attention of the Chief Executive
Officer and the General Counsel) at its principal executive offices and to
Stodnick at his principal residence, as listed above, or to such other address
as any party may have furnished to the other in writing and in accordance
herewith. Notices of change of address shall be effective only upon receipt.
9. ENTIRE AGREEMENT. This Agreement shall constitute the entire agreement
among the parties hereto with respect to the subject matter hereof and shall
supersede all prior verbal or written agreements, covenants, communications,
understandings, commitments, representations or warranties, whether oral or
written, by any party hereto or any of its representatives pertaining to such
subject matter.
10. GOVERNING LAW. Any dispute, controversy, or claim of whatever nature
arising out of or relating to this Agreement or breach thereof shall be governed
by and under the laws of the State of Ohio.
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IN WITNESS WHEREOF, the parties have executed and delivered this Agreement
as of the date first set forth above.
XXXXX INDUSTRIES, INC.
By: /s/ Xxxx X. Xxx
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Xxxx X. Xxx
President and Chief Executive
Officer
Date: January 24, 2006
Witness: /s/ Xxxxx X. X'Xxxx /s/ Xxxxxxx X. Xxxxxxxx
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Xxxxxxx X. Xxxxxxxx
Date: January 24, 2006
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