Exhibit 10n
SEVERANCE AND CONSULTING AGREEMENT
The Severance and Consulting Agreement is made and entered into by
and between Xxxxxx X. Xxxxx (hereinafter "Consultant") and Xxxxxx Industries,
Inc., its allied and affiliated companies (hereinafter "the Company").
W I T N E S S E T H:
WHEREAS, Consultant is presently employed by the Company; and
WHEREAS, Consultant and the Company mutually desire to sever the
employment relationship effective July 13, 1999 amicably by entering into the
severance arrangements stated in this agreement;
WHEREAS, Consultant acknowledges and agrees that his employment
relationship with the Company is being severed under circumstances in which he
would not qualify for receipt of any severance benefits under The Xxxxxx
Industries, Inc. Salaried Employees Severance Plan and that the provisions of
this Agreement constitute the sole and exclusive source of any post-employment
benefits from the Company;
WHEREAS, Consultant acknowledges that he has been advised in
writing to consult with an attorney and that he has been afforded twenty-one
(21) days in which to consider the terms of this Agreement; and
WHEREAS, Consultant has obtained all advice and counsel he needs to
understand each of the terms and conditions of this Agreement;
NOW, THEREFORE, in consideration of the special monetary consideration
and mutual promises stated in this document, it is agreed as follows:
1. At reasonable times during the period beginning with the date of
execution of this document and continuing for eighteen (18) months thereafter,
unless terminated earlier, Consultant shall be available to consult with the
Company concerning professional and other matters within his knowledge or
expertise, including specifically the knowledge or expertise Consultant obtained
as a result of his past employment at the Company. Consultant shall provide such
consulting services as the Company may direct. Consultant shall not enter into
any oral or written agreements on behalf of the Company unless specifically
authorized in writing to do so by an Executive Officer of Xxxxxx Industries,
Inc. The consulting arrangement stated herein shall end in accordance with the
provisions of paragraph (3) below.
2. Consultant understands and agrees that, after July 13, 1999, he
shall not be considered to be an employee of the Company and that during the
term of this Agreement, he shall be classified as an independent contractor and
that he shall be wholly and exclusively responsible for all taxes, including
FICA and federal and state income taxes on sums paid under this Agreement.
Except for the payments and benefits provided herein and previously vested
profit sharing distributions, Consultant shall not be eligible for any other
payments or benefits, such as future profit sharing distributions or any
Company-sponsored medical or insurance benefits, that are or may be provided to
-2-
Company employees. Subject to any COBRA benefits elections made at the
commencement of this Agreement in accordance with normal Company practices, and
except as outlined below, Consultant shall be wholly and exclusively responsible
for his own medical, life, and other insurance coverages.
3. This Agreement shall terminate automatically eighteen (18) months
after the date of its execution. This Agreement shall also terminate
automatically in the event of any revocation by Consultant of the understandings
expressed herein. The Company may terminate this Agreement for Cause. Cause
shall include the following: actions or statements that disparage or criticize
the Company or its affiliates or their officers, directors, employees and
agents; failure to cooperate fully with the Company in providing consulting
services under this Agreement; actions that damage the Company's business,
including, but not limited to any action which interferes with existing
contractual or employment relationships with customers or Company employees; the
filing of any claim, charge or suit against the Company or its affiliates or any
of their past or present officers, directors or employees other than for breach
of this Agreement; material breach of any provision of this Agreement; or
dishonesty or other misconduct involving the performance of Consultant's duties
under this Agreement.
4. Consultant agrees never to take any action which disparages or
criticizes the Company or any of its officers, directors, employees and agents,
or its management practices or which disrupts or impairs its normal operations,
including actions that would result in the filing of any claims, lawsuits or
charges against the Company as a result of anything that has occurred up to and
including the present date.
5. The Company agrees that, commencing after expiration of the
revocation period outlined below, it will:
a) Pay to Consultant $16,000 per month commencing on January
1, 2000 and continuing on the first day of each subsequent
11 months until and including December 1, 2000, and then
pay to Consultant a final payment of $108,000 on January 1,
2001.
b) If Consultant requests reimbursement prior to December 31,
1999 for reasonable legal fees incurred prior to that date
in connection with negotiating and entering into this
Agreement and provides documentation evidencing those fees,
the Company will pay up to $4,000 of the reasonable legal
fees. No legal fees incurred after December 31, 1999 will
be paid by the Company.
c) If the Consultant elects COBRA continuation coverage, the
Company will pay all of the Consultant's COBRA premium,
including the COBRA premium for continuation of dependent
coverage currently in place. This COBRA payment will
continue until the earlier to occur of: (1) eighteen (18)
months following execution of this Agreement, or (2) up to
and until Consultant becomes eligible for coverage under a
group plan provided by another employer.
-3-
As an independent contractor, Consultant shall be wholly and exclusively
responsible for all taxes, including FICA and federal and state income taxes on
these payments.
Also commencing after the expiration of the revocation period outlined below,
the Company agrees that the interest payable under the Deferred Compensation
Agreement dated January 15, 1987 between Xxxxxx Industries, Inc. and Xxxxxx X.
Xxxxx shall be as calculated in Section 3 of such Agreement, without reference
to Section 5 of such Agreement.
6. Except claims for workers' compensation benefits, vested profit
sharing benefits, unpaid salary accrued through July 13, 1999, or the benefits
payable under paragraph 5 of this Agreement, Consultant irrevocably and
unconditionally releases, acquits, and forever discharges the Company and each
of the Company's officers, directors, employees and agents, and all persons
acting by, through under or in concert with any of them (collectively
"Releasees"), or any of them individually, from any and all claims, losses, or
expenses (including attorney's fees and legal expenses), of any nature
whatsoever, whether known or unknown, which Consultant now has, has had, or may
hereafter claim to have had against the Releasees by reason of any matter, act,
omission, cause or event that has occurred up to the present date.
a) This release specifically includes, but is not limited to
all claims arising from or relating in any way to
Consultant's employment relationship with the Company or
the termination of his employment, including any claims for
back pay, losses or other damages to Consultant or his
property resulting from any alleged violation of municipal,
state or federal law, such as (but not limited to) claims
under Title VII of the Civil Rights Act of 1964, 42 U.S.C.
Section 2000e, et. seq., as amended (prohibiting
-- ---
discrimination on account of race, sex, national origin or
religion); claims under the Age Discrimination in
Employment Act of 1967, 29 U.S.C. Sections 621, et. seq.,
-- ---
as amended (prohibiting discrimination on account of age);
claims under the Employee Retirement Income Security Act of
1974, as amended (ERISA), 29 U.S.C. Section 1001, et. seq.;
-- ---
claims under the Americans with Disabilities Act of 1990
(ADA), 42 U.S.C. Sections 12101-12213 (Supp. II 1990); and
any similar federal, state or municipal law claim, whether
sounding in tort or contract, relating in any way to
Consultant's employment.
b) In addition to the specific claims listed above, this
release also includes any and all claims, whether known or
unknown, which might have been asserted by Consultant in
any suit, claim, or charge of discrimination against the
Releasees for or on account of any matter or thing
whatsoever that has occurred up to and including the date
of this Agreement; and
c) Consultant expressly acknowledges that this release may be
pled as a complete defense and will fully and finally bar
any such known or unknown claim or claims based on any acts
or omissions of the Releasees up to the present date.
-4-
7. By signing this Agreement and accepting the benefits outlined above,
Consultant agrees that he will not hereafter pursue any individual claim against
the Company, its officers, directors, employees or agents in any municipal,
state or federal court or agency (such as the Equal Employment Opportunity
Commission or the Department of Labor) for or on account of anything which has
occurred up to the present time as a result of his employment or the end of his
employment with the Company. Consultant also understands and agrees that the
Company will have no obligation to re-employ him.
8. Consultant understands and agrees that if he takes any action or
files any lawsuit in violation of the release provisions stated above, the
Company may at its option terminate his eligibility for any unpaid benefits
under this Agreement and initiate appropriate action to recover all benefits and
moneys previously paid to him as consideration for his signing this Agreement.
Consultant also understands that the Company may recover any actual damages
caused by his actions in violation of this Section 8, and he agrees to reimburse
the Company or any other party released under this Agreement for any costs,
including reasonable attorneys' fees, incurred by them as a result of his breach
of this Section 8.
9. While employed, Consultant has learned and, during the term of this
Agreement, Consultant will learn important proprietary information related to
the Company's business, including, but not limited to, confidential and
proprietary information concerning corporate strategies, proposals, operations
and planning. Consultant acknowledges that the proprietary customer, operations,
financial, and business information that has been or will be learned (i) has
been and will be developed through the Company's expenditure of substantial
effort, time and money; and (ii) together with relationships developed with
customers and employees, could be used to compete unfairly with the Company
during the post-employment period. Because the Company's ability to provide
services on a competitive basis depends, in part, on its proprietary information
and customer relationships, the Company would not share such information and
promote Consultant's relationship with customers if the Company believed that
Consultant would use or disclose such information or relationships in
competition with the Company, or if the Company believed that Consultant's
relationship with the Company's employees or customers would be used to the
detriment of Company.
10. Consultant shall protect Confidential Information from disclosure.
"Confidential Information" is information relating to the Company's customers,
operations, finances, and business that derives value from not being generally
known to others (including any individual, corporation, partnership,
association, unincorporated organization or other entity), and includes, but is
not limited to, technical or non-technical data, formulas, patterns,
compilations, programs, devices, methods, techniques, drawings, processes,
financial data, or lists of actual or potential customers or suppliers
(including identifying information about those customers), whether or not
reduced to writing. Confidential Information includes information disclosed to
the Company by third parties that the Company is obligated to maintain as
confidential. Confidential Information subject to this Agreement may include
information that is not a trade secret, but information that is not also a trade
secret shall constitute Confidential Information only for two years after
termination of Consultant's relationship with the Company. Consultant will not
use, except in connection with work for Company, and will not disclose during or
after Consultant's relationship with the Company, the Company's Confidential
Information. Upon the termination of this Agreement or for any reason or at any
-5-
time at the Company's request, Consultant will deliver promptly to Company all
materials, documents, plans, records, notes, or other papers and any copies in
Consultant's possession or control relating in any way to the Company's
business, which at all times shall be the sole property of the Company.
11. Consultant agrees that, for a period of two (2) years following
July 13, 1999, Consultant shall not, directly or indirectly, solicit or attempt
to solicit (i) any customer of the Company with whom Consultant had contact
during the term of his employment with the Company, (ii) any person or entity
that has been a customer of the Company during the three (3) years prior to the
date hereof and which the Consultant directly or indirectly supervised others
servicing or soliciting on behalf of the Company, or (iii) any customer about
whom Consultant possesses Confidential Information, in each case to provide any
service or sell any product to such customer that is identical to or reasonably
substitutable for any service or product available from the Company.
12. Consultant agrees that, for a period of two (2) years following
July 13, 1999, Consultant shall not, directly or indirectly, solicit or attempt
to solicit individuals who were employees, consultants or independent
contractors of the Company at the time of Consultant's termination of employment
to leave their employment with or engagement by the Company.
13. Consultant understands and agrees that any breach of paragraphs 9
through 12 of this Agreement may cause the Company great and irreparable harm
and that it would be difficult or impossible to establish the full monetary
value of such damage. Consequently, Consultant covenants and agrees that in the
event of any breach of these paragraphs of the Agreement, the Company will have
the right to seek injunctive relief to restrain any breach or threatened breach
or otherwise to specifically enforce any provision of this Agreement, without
the posting of a bond or other security, in addition to whatever other remedies
the Company may have.
14. The covenants contained in this Agreement which, by their terms,
require their performance by the Consultant after the expiration or other
termination of this Agreement, shall be enforceable notwithstanding said
expiration or other termination of this Agreement for any reason whatsoever.
15. Except as set forth below, Consultant further agrees to keep the
terms, amount and fact of this Agreement completely confidential, and Consultant
will not disclose the terms or amount of the pay arrangements or any other
information about this Agreement to anyone, including, but not limited to, any
past, present or future employee or job applicant of the Company. Moreover,
Consultant understands that despite this confidentiality provision, Consultant
may disclose this Agreement in obtaining legal or tax advice from an attorney or
accountant, provided that the person or persons to whom Consultant makes such a
disclosure agrees to abide by this confidentiality provision. Consultant further
understands that he may disclose this Agreement, after providing appropriate
advance notice to the Company, if such disclosure is required by lawful judicial
process or by the Internal Revenue Service for tax purposes.
-6-
16. Consultant represents and acknowledges that in executing this
Agreement, Consultant does not rely and has not relied upon any promise,
inducement, representation or statement made by the Company or its agents,
representatives or attorneys about the subject matter, meaning or effect of this
Agreement that is not stated in this document.
17. For a period of up to and including seven (7) days after the date
Consultant signs this Agreement, he may revoke it entirely. No rights or
obligations contained in this Agreement shall become enforceable before the end
of this seven-day revocation period. If Consultant decides to revoke the
Agreement, he will deliver a signed Notice of Revocation on or before the end of
this seven-day period. Upon delivery of a timely Notice of Revocation, this
Agreement shall be canceled and void and neither party to this Agreement shall
have any rights or obligations arising under it.
18. This Consulting Agreement is made and entered into in the State of
Georgia, and shall be interpreted, enforced and governed under the laws of
Georgia. The language of all parts of this Agreement shall in all cases be
construed as a whole, according to its fair meaning, and not strictly for or
against any of the parties.
19. If any provision of this Agreement is declared or determined by any
court to be illegal or invalid, the validity of the remaining parts, terms or
provisions shall not be affected, but the illegal or invalid part, term or
provision shall be excluded from this Agreement.
20. This Consulting Agreement sets forth the entire agreement between
the Consultant and the Company and fully supersedes any and all prior agreements
or understandings between them.
Consultant understands that this Agreement must be signed and returned to the
Company without any alteration. Any modifications or alteration of the terms of
this Agreement voids the Agreement in its entirety.
CONSULTANT FURTHER ACKNOWLEDGES AND AGREES THAT NO OTHER PROMISE OR AGREEMENT OF
ANY KIND HAS BEEN MADE TO HIM BY THE COMPANY TO CAUSE HIM TO EXECUTE THIS
AGREEMENT AND THAT THE ONLY CONSIDERATION FOR HIS EXECUTION OF THIS AGREEMENT IS
SET FORTH COMPLETELY AND FULLY IN THIS DOCUMENT. CONSULTANT HAS CAREFULLY READ
THIS AGREEMENT, HE UNDERSTANDS ITS MEANING AND INTENT, AND HE VOLUNTARILY AGREES
TO ABIDE BY ITS TERMS. CONSULTANT ACKNOWLEDGES THAT THE COMPENSATION HE IS
ELIGIBLE TO RECEIVE IS ADEQUATE CONSIDERATION FOR HIS SIGNING THIS AGREEMENT AND
THAT HE HAS NOT BEEN COERCED INTO SIGNING THIS AGREEMENT AND HAS SIGNED IT
FREELY AND VOLUNTARILY. CONSULTANT FURTHER ACKNOWLEDGES RECEIVING A COPY OF THIS
AGREEMENT FOR HIS PERSONAL RECORDS.
-7-
/s/ Xxxxxx X. Xxxxx
---------------------------------
XXXXXX X. XXXXX
Date: 7/13/99
----------------
Witnessed:
/s/ Xxxxx Silverhawk
-------------------------------
Date: 7/13/99
-------------------------- XXXXXX INDUSTRIES, INC.
/s/ Xxxx X. Xxxxxx
---------------------------------
Date: July 13, 1999
Witnessed: -----------------
/s/ Xxxxxxx X. Xxxxxxx
-------------------------------
Date: 7/13/99
--------------------------
