GLOBAL HEADQUARTERS TEL 610-594-3327 ∙ FAX 610-594-3013 rick.luzzi@westpharma.com RICHARD D. LUZZI Vice President, Human Resources July 28, 2008 Mr. Matthew T. Mullarkey 29844 Lake Road Bay Village, OH 44140 Re: Severance and Non-Competition Agreement...
Exhibit
10.3
GLOBAL
HEADQUARTERS
000 Xxxxxx Xxxxx x Xxxxxxxxx,
XX 00000
TEL 000-000-0000 ∙ FAX
000-000-0000
xxxx.xxxxx@xxxxxxxxxx.xxx
XXXXXXX
X.
XXXXX
Vice
President, Human Resources
July 28, 2008
Xx.
Xxxxxxx X. Xxxxxxxxx
00000
Xxxx Xxxx
Xxx
Xxxxxxx, XX 00000
Dear
Matt:
In
consideration of your employment with West Pharmaceutical Services, Inc. (the
“Company”) as its Chief Operating Officer, you and the Company, intending to be
legally bound, agree as follows:
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1.
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Termination
of Employment.
You will be entitled to the benefits specified in Section 2 if your
employment with the Company is terminated by the Company, other than for
cause or by reason of death, disability, or retirement at normal or early
retirement age pursuant to the Company’s Employees’ Retirement Plan (or
any successor pension plan thereto) (the “Retirement Plan”) or if you have
a Constructive Termination (as defined in the Change in Control Agreement
between you and the Company, dated July 28, 2008 (the “CIC
Agreement”). You will not be entitled to the benefits
specified in Section 2 if your employment terminates for any other
reasons, including, without limitation, your voluntary resignation, or if,
during the term of your employment or at any time thereafter, you engage
in any activity specified in Section 3
hereof.
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a)
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Constructive
Termination. If you terminate your employment due to a
Constructive Termination, you must satisfy each of the conditions
contained in the CIC Agreement and you must notify the Company of the
circumstances giving rise to a Constructive Termination within 10 days of
the date you knew or should have known that those circumstances
existed.
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b)
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Release. Any
benefits payable hereunder are conditioned upon your execution,
non-revocation and compliance with the terms of a Release substantially in
the form attached hereto as Exhibit
A.
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1
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2.
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Benefits
Payable Upon Termination of Employment.
Upon termination of employment as set forth in Section 1, you shall
be entitled to the following
benefits:
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a)
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Severance
Compensation. Your regular salary as in effect on the date of
termination of your employment will continue for a period of twelve
months, with normal deductions. The salary continuation payments shall be
made on the Company’s normal payroll cycle. Notwithstanding
anything herein to the contrary, to the extent that you are a “specified
employee” and payments must be delayed six months as required by section
409A(a)(2)(B) of the Internal Revenue Code of 1986, the first six months
of payments required to be paid under this Agreement shall be made on the
first normal payroll date that is six months following your termination of
employment in a single, lump sum and each subsequent payment shall be made
on the normal payroll date. The severance compensation paid
hereunder shall not be reduced to the extent of any other compensation for
your services which you receive or are entitled to receive from any other
employment consistent with the terms of this
Agreement.
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b)
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Employee
Benefits. You shall be entitled to a continuation of all medical,
dental and life insurance in the same manner and amount to which you were
entitled on the date of termination of your employment until the earlier
of (i) a period of twelve months after termination of your employment, or
(ii) your eligibility for similar benefits with a new employer. All other
benefits not otherwise addressed in this Agreement shall terminate as of
the date of termination of your
employment.
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3.
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Termination
of Benefit.
The Company shall have no obligation to provide or continue any of
the benefits under Section 2 (except as required by applicable law) upon
the breach of any of your obligations (i) under Section 4 hereof, (ii) the
provisions of your Confidentiality Agreement with the Company, which is
attached to your Change-in-Control Agreement with the Company as Exhibit A
and incorporated by reference herein, or (iii)
you:
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a)
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engage
in conduct in connection with your employment for which criminal or civil
penalties against you or the Company may be sought;
and
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b)
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violate
any of the Company’s material policies, including without limitation the
Company’s insider-trading policy.
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4.
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Covenant Not To
Compete.
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a)
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During
the period beginning on the date of your termination of employment and
ending on the first anniversary thereof (the “Restrictive Period”), you
will not, and will not permit any of your Affiliates, or any other Person,
directly or indirectly, to:
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i)
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engage
in competition with, or acquire a direct or indirect interest or an option
to acquire such an interest in any Person engaged in competition with, the
Company’s Business in the United States (other than an interest of not
more than 5 percent of the outstanding stock of any publicly traded
company);
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ii)
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serve
as a director, officer, employee or consultant of, or furnish information
to, or otherwise facilitate the efforts of, any Person engaged in
competition with the Company’s Business in the United
States;
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2
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iii)
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solicit,
employ, interfere with or attempt to entice away from the Company any
employee who has been employed by the Company or a Subsidiary in an
executive or supervisory capacity in connection with the conduct of the
Company’s Business within one year prior to such solicitation, employment,
interference or enticement; or
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iv)
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approach,
solicit or deal with in competition with the Company or any Subsidiary any
Person which at any time during the 12 months immediately preceding the
Termination Date:
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(1)
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was
a customer, client, supplier, agent or distributor of the Company or any
Subsidiary;
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(2)
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was
a customer, client, supplier, agent or distributor of the Company or any
Subsidiary with whom employees reporting to or under your direct control
had personal contact on behalf of the Company or any Subsidiary;
or
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(3)
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was
a Person with whom you had regular, substantial or a series of business
dealings on behalf of the Company or any Subsidiary (whether or not a
customer, client, supplier, agent or distributor of the Company or any
Subsidiary).
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b)
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As
used in this Section, each of the capitalized terms that are not
separately defined herein shall have the same meaning contained in the CIC
Agreement. For the avoidance of doubt, you agree that the
phrase “Person engaged in competition with the Company’s Business” as used
in this Section includes, the companies listed on Exhibit B to your CIC
Agreement, and their Affiliates and
Subsidiaries.
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5.
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Payments
Final and Exclusive. In
the event of a termination of your employment under the circumstances
described in this Agreement, the arrangements provided for by this
Agreement, or any other agreement between the Company and you in effect at
that time and by any other applicable plan of the Company in which you
then participate shall constitute the entire obligation of the Company to
you, and performance of that obligation shall constitute the settlement of
any claim that you might otherwise assert against the Company on account
of such termination. You agree that if you are entitled to
payments or benefits under this Agreement, that you will not separately be
entitled to any severance under any applicable plan, agreement or policy
of the Company, nor will you be entitled to receive any of the benefits
under your CIC Agreement. Furthermore, you agree that if you
are entitled to receive payments or benefits under your CIC Agreement, you
will not separately be entitled to receive any payments or benefits under
this Agreement.
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6.
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Duration
of Agreement;
Amendment.
This Agreement may not be terminated or amended by either party,
except that this Agreement may be terminated or amended at any time by the
mutual written consent of you and the
Company.
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3
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7.
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Enforcement.
You acknowledge that a breach of this Agreement will cause the
Company immediate and irreparable harm for which the Company’s remedies at
law (such as money damages) will be inadequate. The Company shall have the
right, in addition to any other rights it may have, to obtain an
injunction to restrain any breach or threatened breach of this Agreement.
Should any provision of this Agreement be adjudged to any extent invalid
by any competent tribunal, that provision will be deemed modified to the
extent necessary to make it enforceable. The Company may contact any
Person with or for whom you work after your employment by the Company ends
and may send that Person a copy of this
Agreement.
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8.
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Miscellaneous.
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a)
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This
Agreement will be binding upon and inure to the your benefit, your
personal representatives and heirs and the Company and any successor of
the Company, but neither this Agreement nor any rights arising hereunder
may be assigned or pledged by you.
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b)
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You
acknowledge that a breach of the covenants contained in this Agreement
will cause the Company immediate and irreparable harm for which the
Company’s remedies at law (such as money damages) will be inadequate. The
Company shall have the right, in addition to any other rights it may have,
to obtain an injunction to restrain any breach or threatened breach of
such Sections. The Company may contact any Person with or for whom you
work after your employment by the Company ends and may send that Person a
copy of this Agreement.
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c)
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Should
any provision of this Agreement be adjudged to any extent invalid by any
competent tribunal, that provision will be deemed modified to the extent
necessary to make it enforceable. The invalidity or
unenforceability of any provision hereof or Exhibit hereto shall in no way
affect the validity or enforceability of any other provision
hereof.
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d)
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This
Agreement will be governed and construed in accordance with the laws of
the Commonwealth of Pennsylvania.
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e)
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This
Agreement constitutes the entire agreement and understanding between the
Company and you with respect to the subject matter hereof and merges and
supersedes all prior discussions, agreements and understandings between
the Company and you with respect to such
matters.
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f)
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This
Agreement may be executed in one or more counterparts, which together
shall constitute a single
agreement.
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If you
are in agreement with the foregoing, please so indicate by signing and returning
to the Company the enclosed copy of this letter, whereupon this letter shall
constitute a binding agreement between you and the Company and our mutual
intention to be legally bound as of the date and year first written
above.
Very
truly yours,
WEST
PHARMACEUTICAL SERVICES, INC.
By:
/s/ Xxxxxxx X.
Xxxxx
Xxxxxxx X. Xxxxx
Vice President, Human
Resources
Accepted
and Agreed To:
/s/ M
Xxxxxxxxx
Xxxxxxx
X. Xxxxxxxxx
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EXHIBIT
A
AGREEMENT AND GENERAL
RELEASE
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NOTICE: This is a very important
legal document, and you should thoroughly review and understand the terms
and effect of this document before signing it. By signing this
Agreement and General Release, you will be completely releasing West
Pharmaceutical Services, Inc. from all liability to
you. Therefore, you should consult with an attorney before
signing this Agreement and General Release. You have twenty-one (21) days
from the date of distribution of these materials to consider this
document. If you have not returned a signed copy of this
Agreement and General Release by that time, we will assume that you have
elected not to sign the Agreement and General Release. If you
choose to sign the Agreement and General Release, you will have an additional seven (7)
days following the date of your signature to revoke the Agreement
and General Release, and the Agreement and General Release between you and
the Company shall become effective or enforceable until the revocation
period has expired. Any revocation of this
Agreement and General Release must be in writing and must be personally
delivered or mailed to Xxxxxxx X. Xxxxx, Vice President, Human
Resources.
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Intending
to be legally bound by the provisions of this Agreement and in consideration of
the negotiated payments and benefits specified in the Letter Agreement to which
this Agreement and General Release is attached as Exhibit A, which shall be
incorporated as if fully set forth within, dated ___________, between West
Pharmaceutical Services, Inc. and me, providing valuable consideration to which
I would otherwise not be entitled, I, Xxxxxxx X. Xxxxxxxxx, hereby release and
discharge West Pharmaceutical Services, Inc. and its affiliates, parents,
subsidiaries, successors, and predecessors and all of their employees, agents,
attorneys, officers, and directors (individually and collectively referred to as
the “Company”) from any and all claims and/or causes of action, whether known to you or the Company
at the time of the execution of this General Release or not, which I may
have or could claim to have against the Company in connection with my employment
with the Company up to and including the date of my signing of this General
Release.
This
General Release includes, but is not limited to, a full waiver of all claims
arising from or during my employment or as a result of the termination of my
employment and all claims arising under federal, state, or local laws
prohibiting employment discrimination based upon age, race, sex, religion,
handicap, national origin, or any other protected characteristic, including, but
not limited to, any and all claims arising under the Age Discrimination in
Employment Act (“ADEA”), Title VII of the Civil Rights Act of 1964 and
1991, the Americans with Disabilities Act, the Family and Medical Leave Act, the
Equal Pay Act, the Pennsylvania Wage Payment and Collection Law, the
Pennsylvania Human Relations Act, any other federal, state or local labor or
employment law, and claims under the common law and/or growing out of any legal
restrictions, express or implied, in contract or on any other grounds, or the
Company’s right to control or terminate the employment of its
employees.
By
signing below, I acknowledge that I have carefully read and fully understand the
provisions of this Agreement and General Release. I further
acknowledge that I am signing this Agreement and General Release knowingly and
voluntarily and without duress, coercion or undue influence. I agree
that I will not file a lawsuit asserting any claims barred by this General
Release against the Company. If I breach this promise, then I will
reimburse the Company for its reasonable attorneys’ fees and costs incurred in
defending against such released Claims, and I shall also be obligated to tender
back upon filing of such complaint in state or federal court or before any
administrative agency any consideration that I have received pursuant to the
severance arrangements provided within the accompanying Letter
Agreement. A suit challenging the validity of this General Release
under ADEA, however, shall not be subject to the provisions of this
paragraph.
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I agree
that this Agreement and General Release may be pleaded as a complete bar to any
action or suit before any court, arbitral or administrative body with respect to
any of the released claims.
This
Agreement and General Release together with the Letter Agreement constitutes the
total and complete understanding between me and the Company relating to the
subject matter covered by this Agreement and General Release and all other prior
or contemporaneous written oral agreements or representations, except the
accompanying Letter Agreement setting forth the terms of my severance
arrangement, if any, otherwise relating to the subject matter of this Agreement
and General Release are null and void. It is also expressly
understood and agreed that the terms of this Agreement and General Release may
not be altered except in writing signed by both the Company and me. I
further understand and agree that the terms and conditions of this Agreement and
General Release shall not be communicated to any persons other than those
referred to herein and to my spouse or legal counsel, if
applicable. Finally, it is understood and agreed that the execution
of this Agreement and General Release is not an admission of liability on the
part of either party.
This
Agreement and General Release shall be governed in all respects, whether as to
validity, construction, capacity, performance, or otherwise, by the laws of the
Commonwealth of Pennsylvania, and no action involving this Agreement may be
brought except in the state courts located in Xxxxxxx County, Pennsylvania or
the Federal District Court for the Eastern District of
Pennsylvania.
If any
provision of this Severance Agreement and General Release, or the application
thereof, is held to be invalid, void or unenforceable for whatever reason, the
remaining provisions not so declared shall nevertheless continue in full force
and effect without being impaired in any manner whatsoever. If
any party waives any provision of this Agreement, such waiver shall not affect
any provision of the agreement not specifically waived.
INTENDING
TO BE LEGALLY BOUND, I hereby set my hand and seal below:
Witnessed
by: EMPLOYEE
______________________________ ____________________________
Xxxxxxx X.
Xxxxxxxxx
DATED DATED
______________________________ _____________________________
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