SEVERANCE AGREEMENT AND RELEASE
THIS SEVERANCE AGREEMENT and RELEASE ("Agreement") is entered into between
Xxxxx Xxxxxxx ("Executive') and Foamex International Inc., Foamex L.P., Foamex
Carpet Cushion L.L.C. and all other affiliates and subsidiaries of Foamex
International Inc. (collectively "Foamex"). Executive and Foamex are entering
into this Agreement because Executive's employment with Foamex is terminating
and the parties (a) wish to define the terms of Executive's separation from
employment, and (b) wish to amicably resolve any and all claims and disputes
which have been (or could have been) asserted by Executive against Foamex.
Executive and Foamex agree that termination of the Executive's employment is for
legitimate business reasons. This Agreement will supercede any previous
Agreements between the parties, except as otherwise set forth in this Agreement.
Specific terms and conditions:
1 Termination of Employment. Executive's last day of work shall be October
31, 2002, which shall be defined as the "Termination Date".
2 Severance Payment. Executive will receive a total of $750,000 (seven
hundred fifty thousand dollars, less applicable taxes and withholdings) to be
paid over the course of 24 months in accordance with the normal Foamex salaried
payroll calendar beginning the Termination Date as part of the consideration for
this Agreement.
3 Supplemental Benefits. For a twenty-four (24) month period beginning on
the Termination Date, Executive also will receive continued medical and dental
coverage consistent with that available to Foamex employees which he would be
otherwise entitled under COBRA. If such coverage is elected by Executive. he
will be required only to make the normal employee contribution to medical
benefits on a monthly basis during this period. Thereafter, Executive will be
eligible to continue medical and dental coverage pursuant to COBRA at his own
expense for a period of 18 months. All other benefits will terminate on the
Termination Date. Executive will be provided with information by Xxxxxx
Consulting regarding options to acquire the split dollar life insurance policy
on his life.
4 Non-Competition. For a period of twenty-four (24) months beginning on the
Termination Date, Executive shall not, directly or indirectly, whether as an
employee, consultant, independent contractor, partner, or joint venturer, (i)
perform any services for a competitor which has material operations which
directly compete with the Company in the sale of any products sold by the
company at the time of termination of Executive's employment; (ii) solicit or
induce, or in any manner attempt to solicit or induce, any person employed by,
or as agent of, the Company to terminate such person's contract of employment or
agency, as the case may be, with the Company or (iii) divert, or attempt to
divert, any person, concern, or entity from doing business with the company, nor
will he attempt to induce any such person, concern or entity to cease being a
customer or supplier of the Company. Notwithstanding anything herein to the
contrary, this Section shall not prevent Executive from acquiring securities
representing not more than 5% of the outstanding voting securities of any
publicly held corporation.
5 Acknowledgment of Non-Competition and No Solicitation Provisions.
Executive expressly acknowledges and agrees that (a) he understands the scope
and meaning of the restrictions set forth in Section 4 of this Agreement, (b)
agrees that they are necessary and reasonable to protect Foamex's legitimate
interests, (c) agrees that he has been well compensated though this Agreement
for agreeing to these restrictions, (d) agrees that these restrictions will not
prevent him from engaging in gainful and meaningful employment during their
term. Failure to comply with any term set forth in Section 4 of this Agreement
will result in Executive's forfeiture of the severance payment, but shall not
relieve Executive of his obligations under this Agreement.
6 Confidential Corporate Information. Executive agrees that he will not
make use or or divulge to any other person, firm or corporation any trade or
business secret, process, method or means, or any other confidential information
concerning the business or policies of the Company, which he may have learned in
connection with this employment. For purposes of this Agreement, a "trade or
business secret, process, method or means, or any other confidential
information" shall mean and include written information reasonably treated as
confidential or as a trade secret by the Company. Executive's obligations under
this Section shall not apply to any information which (i) is known publicly;
(ii) is in the public domain or hereafter enters the public domain without the
fault of Executive; (iii) is known to Executive prior to his receipt of suchg
information from the Company, as evidence by written records of Executive or
(iv) is hereafter disclosed to Executive by a third party not under an
obligation of confidence to the Company.
7 General Release. In consideration for the severance payments and paid by
Foamex as set forth above, and other good and valuable consideration set forth
herein, Executive hereby releases Foamex, its shareholders, directors, officers,
employees, agents, attorneys, affiliates, parents, subsidiaries, predecessors,
successors, assigns, and all persons acting by, through, under or in concert
with any of them, from any and all charges, complaints, claims, liabilities,
obligations, promises, agreements, controversies, damages, actions, causes of
action, suits, rights, demands, costs, losses, debts and expenses, and from any
claims of any nature whatsoever, known or unknown, which Executive now has,
claims to have, own, hold or which Executive at any time heretofore had, held,
or claims to have, including without limitation, claims for: wrongful discharge;
breach of covenant of good faith and fair dealing; intentional or negligent
infliction of emotional distress; breach of contract or implied contract;
negligence; misrepresentation; fraud; detrimental reliance; promissory estoppel;
defamation; invasion of privacy; sexual harassment; breach of laws governing
safety in the workplace; discrimination on the basis of sex, race, color,
religion, age, national origin, status as a handicapped of disabled person or
status of a non-citizen; any and all claims under the Age Discrimination in
Employment Act ("ADEA"); any and all claims under Title VII of the Civil Rights
Act of 1964; any and all claims under the Americans with Disabilities Act; any
and all claims under state or local laws which prohibit improper discrimination;
and any and all claims for benefits under the ERISA, except for all claims for
vested pension benefits under ERISA.
8 No Right to Re-employment. Executive hereby agrees and recognizes that
his employment relationship with Foamex or its affiliates is being permanently
and irrevocably severed and that Foamex has no obligation, contractual or
otherwise, to rehire, re-employ, recall or to hire him in the future, or return
him to active status.
9 Cooperative Conduct / Non Disparagement. Executive hereby agrees, as part
of the consideration for this Agreement, to cooperate with reasonable requests
by Foamex, in good faith and in a continuing manner. In addition, both parties
agree that they shall refrain from conduct or statements which may be construed
as disparaging or harmful to the other party or in the case of Foamex to any of
its present, past, or future Directors, Officers or Employees individually or
collectively.
10 Additional Covenants and Acknowledgments. Executive further understands
and agrees:
a) that by signing this Agreement he is voluntarily making a full and
final compromise and settlement of any and all claims, disputed or
otherwise, arising out of his employment relationship with Foamex including
claims under the Age Discrimination in Employment Act (ADEA) which he may
have, and that this Agreement will preclude any further or additional
claims arising out of said relationship, but will not preclude any claims
which might arise after the Agreement is executed;
b) that, in accordance with the federal law, the Executive has
twenty-one (21) calendar days from the date this Agreement is received by
him to consider and accept the Agreement by signing and returning it to
Foamex, and if so accepted, another seven (7) calendar days to revoke that
acceptance should he change his mind;
c) that Executive has the right to consult any attorney prior to
signing this Agreement and has been encouraged to do so by Foamex;
d) that Foamex and Executive have agreed that the terms of the
Agreement are and shall remain completely confidential, except that the
parties may disclose the terms of this Agreement to legal counsel and tax
advisors. In addition, Foamex may disclose the terms of this Agreement to
those individuals whose services are required to authorize, implement, or
enforce the terms of this Agreement. It is understood and agreed by
Executive and Foamex, that those to whom disclosure may be made under this
provision, also must keep the terms of this Agreement confidential;
e) that Executive acknowledges that this Agreement is contractual and
not a mere recital; and agrees that this Agreement shall be given full
force and effect and that it shall be binding upon Executive's heirs,
executors, successors, administrators and assigns.
11 Rights Transferable to Executive's Estate. If Executive should die
during the term of this Agreement, the remaining unpaid portion of his severance
payment (if any) and his vested and unvested stock options will be transferred
and assignable to his estate, to the extent permissible by law and the terms of
the plan.
12 Parties Covered by Agreement. The provisions of this Agreement shall
inure to the benefit of Foamex, its successors and assigns, and shall be binding
upon Foamex and Executive, and his heirs, personal representatives, and
successors, including, without limitation, Executive's estate and executors,
administrators, or trustees of such estate. In the event of the sale, merger, or
consolidation of Foamex with or into any other corporation or entity, or in the
event substantially all of the assets of Foamex shall be transferred to another
entity, the successor to such assets, as the case may be, shall, as a condition
to the consummation of the merger, consolidation, or sale, assume the
obligations of Foamex hereunder and shall be substituted for Foamex in all
respects.
13 Severability. The invalidity or unenforceability of any provision or
part of any provision of this Agreement or any covenant contained herein shall
not affect the validity or enforceability of any other provision or part of any
provision of this Agreement, which shall remain in full force and effect. In the
event that any provision of this Agreement (or part thereof) is determined to be
invalid or unenforceable for any reason, that provision shall be construed by
limiting it so as to be valid and enforceable to the fullest extent compatible
with and possible under applicable law.
14 Application of Agreement. Except for agreements between Executive and
Foamex concerning certain stock option grants listed in Schedule "A" to this
Agreement, upon execution of this Agreement, the Executive's employment with
Foamex and termination thereof shall be governed exclusively by this Severance
Agreement and Release, and this Agreement shall supersede any and all previously
existing agreements and understandings between the parties.
15 Period for Acceptance of Agreement. The terms of this Agreement shall
remain open for acceptance by the Executive at any time before and including
twenty-one (21) calendar days from the date this Agreement is received by the
Executive. Should the Executive decline to execute this Agreement it is
understood that the terms contained and offered herein are withdrawn without
prejudice to the rights of Foamex.
16 Applicable Law. The Agreement shall be construed and enforced under and
in accordance with the laws of the Commonwealth of Pennsylvania.
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Executive represents and certifies that he has carefully read and fully
understands all of the provisions of this Agreement and that he is signing this
Agreement voluntarily, of his own free will and without duress; and that Foamex,
its agents, representatives or attorneys have made no representations concerning
the terms or effects of this Agreement other than contained herein.
IN WITNESS THEREOF, the Executive has duly executed this Release and
Agreement on this day of 21 November, 2002.
/s/ Xxxxx X. Xxxxxxx 21 November 2002
_____________________ ____________________
Executive Date
/s/ Xxxxxxx X. Xxxxxxxxx 21 November 2002
________________________ ____________________
For Foamex International Inc. Date
Foamex L.P., Foamex Carpet Cushion LLC and Subsidiaries
WITNESS: ______________________________________
Tendered this ____ day of ____________, 19__, to _______________________
by __________________________________, Title _____________________________
