SEPARATION-RELEASE AGREEMENT
BETWEEN
MACDERMID INCORPORATED
OF
000 XXXXXXX XXXXXX
XXXXXXXXX, XX.
AND
XXXX X. XXXXXXXXXX
OF
TRUMBULL, CONNECTICUT
This agreement, made and entered into as of September 9, 2002, is for the
purpose of providing a binding agreement and understanding by and between
MacDermid Incorporated (hereinafter MacDermid) and Xxxx X. Xxxxxxxxxx
(hereinafter "Former Employee").
WITNESSETH THAT:
Whereas; Former Employee's employment with MacDermid has terminated;
Whereas both parties hereto desire to make the proposed transition as amiable
and trouble-free as possible;
Now, therefore, in consideration of the premises and mutual covenants of the
parties, it is agreed as follows:
ARTICLE I(DEFINITIONS)
-----------------------
a. Affiliate or MacDermid Affiliate shall refer to any organization in which
MacDermid now or later holds at least a 50% ownership share and any qualified or
unqualified benefit plans that are related to MacDermid or subsidiaries of
MacDermid.
ARTICLE II (RESIGNATION FROM EMPLOYMENT/RELEASE)
----------------------------------------------------
a. Former Employee's employment with MacDermid terminated as of September 9,
2002. As of that date Former Employee will resign as an officer of MacDermid.
b. Former Employee hereby releases, remises and forever discharges MacDermid
and all of its respective parent corporations, subsidiaries, Affiliates,
predecessors and successors in interest, agents, employees, owners, partners,
officers, directors, members and shareholders from any and all suits, claims,
costs, demands, attorney's fees, damages, back pay, front pay, interest, special
damages, general damages, worker's compensation claims, punitive damages,
liabilities, actions, administrative proceedings, expenses, accidents, injuries
and any other cause of action in law or equity that Former Employee has or may
have or might in any manner acquire which arise out of, relate to, or is in
connection with his/her employment with, relationship with or business dealings
with MacDermid or any MacDermid Affiliates or employees thereof, or the
termination of that employment, relationship or dealings, and the Employment
Agreement between the Former Employee and MacDermid dated January 7, 2002, as
amended, (the "Employment Agreement"), and any other act, occurrence or
omission, known or unknown, which occurred or failed to occur on or before the
date this Agreement is executed other than MacDermid's obligations and the
Former Employee's rights under this Agreement only. IT IS UNDERSTOOD AND AGREED
THAT THIS IS A FULL AND FINAL RELEASE OF ALL CLAIMS OF EVERY NATURE AND KIND
WHATSOEVER AND RELEASES CLAIMS THAT ARE KNOWN AND UNKNOWN, other than
MacDermid's obligations and the Former Employee's rights under this Agreement
only.
Former Employee expressly waives protection of any legal provision, law, statute
or regulation, which provides generally: A general release does not extend to
claims which the releasor does not know or suspect to exist in his/her favor at
the time of executing a release, which if known by him/her would have materially
affected the settlement.
THIS RELEASE INCLUDES, WITHOUT LIMITATION, A RELEASE FOR ANY CLAIM OF
DISCRIMINATION SPECIFICALLY INCLUDING, WITHOUT LIMITATION, DISCRIMINATION BASED
UPON AGE, GENDER, RACE, NATIONAL ORIGIN, RELIGION AND DISABILITY INCLUDING
CLAIMS UNDER ANY FEDERAL OR STATE EMPLOYMENT STATUTE, THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT, THE AGE DISCRIMINATION IN EMPLOYMENT ACT, THE AMERICANS
WITH DISABILITIES ACT, THE CONNECTICUT FAIR EMPLOYMENT PRACTICES ACT, THE CIVIL
RIGHTS ACTS OF 1866, 1964 AND 1991, THE FEDERAL AND CONNECTICUT FAMILY MEDICAL
LEAVE ACTS, AND SECTION 290(A) OF CONNECTICUT'S WORKERS' COMPENSATION LAW.
Former Employee further acknowledges that, without limitation, this release
immediately releases and forfeits any rights the Former Employee may have had to
200,000 options to purchase MacDermid common stock and to the Forfeited Shares.
Former Employee further acknowledges that the execution of this Agreement
reflects Former Employee's individual analysis and determination that the
execution of this Agreement is in his/her best interest.
Former Employee agrees that neither he/she nor anyone acting on his behalf or
through him/her will file a lawsuit or other action asserting any claims that
are released in this Agreement.
ARTICLE III (PAYMENTS)
------------------------
As consideration for the agreements and covenants made herein, the release
given, the actions taken or contemplated to be taken, or to be refrained from,
the parties agree to the following:
a. Former Employee shall be paid by MacDermid for twelve (12) months
severance pay, determined solely upon the Former Employee's current base salary
($300,000).
The payment above will be made within 30 days of MacDermid's receipt of
this Agreement properly executed. Appropriate taxes and withholdings will be
deducted from such payment. The payment will be made in one single payment
amount.
b. Former Employee shall be paid the remainder of his bonus for 2002 equal
to $200,000.00, exclusive of payments made prior to the effective date of this
Agreement. This payment will be made within 30 days of MacDermid's receipt of
this Agreement properly executed. Appropriate taxes and withholdings will be
deducted.
c. Former Employee will earn PTO time through their final day of employment,
as per our PTO policy. If PTO time has been taken in excess of the time
earned, a deduction will be taken from the severance payment. Former Employee
will submit a final PTO report of days taken through his/her final day of
employment for PTO to be paid. Former Employee will be reimbursed for earned
but unused PTO.
d. Former Employee may continue medical and dental benefits up to 18
consecutive months from the date of last actual employment under COBRA.
PREMIUMS WILL CONTINUE AT THE EMPLOYEE RATE FOR THE FIRST 12 MONTHS OF THIS
PERIOD.
e. Group life insurance can be converted to individual life insurance with
Principle Life within -30 days of last day of actual employment. Please call the
Conversion Unit at 0-000-000-0000 x 00000 our group policy number is P84631.
f. Outplacement will be provided at a level determined by MacDermid in
MacDermid's sole discretion.
g. Former Employee has 130,000 shares of restricted stock pursuant to the
terms of the 1995 Equity Incentive Plan, none of which have vested. The Former
Employee shall be allowed to retain 50,000 shares of restricted stock (the
"Retained Shares") which shall vest on the following schedule:
1. 32,500 shares 30 days from the effective date of this Agreement;
2. 17,500 shares 1 year from the effective date of this Agreement;
in both cases, provided no breach of this Agreement by the Former Employee has
occurred. The remaining 80,000 restricted shares (the "Forfeited Shares") shall
be immediately and irrevocably forfeited and returned to MacDermid for
cancellation. Upon vesting in each case, MacDermid shall promptly deliver to
the Former Employee unlegended stock evidencing Former Employee's unrestricted
ownership in such shares.
x. XxxXxxxxx shall pay Former Employee his salary through the termination
date only and will also reimburse Former Employee for regular MacDermid business
expenses incurred prior to the termination date.
Former Employee understands that the payments and benefits listed above are all
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that Former Employee is entitled to receive from MacDermid. Former Employee
will receive no further wage, vacation, severance, insurance or other benefits
--
from MacDermid including stock options and shares of restricted stock. Former
Employee agrees that the payments and benefits above are more than MacDermid is
required to pay under its normal policies, procedures and plans.
ARTICLE IV (MISCELLANEOUS)
----------------------------
a. Former Employee shall immediately return all company property in his/her
possession or control except that the Former Employee may keep a laptop
computer, a cell phone and a blackberry. As of the termination date the Former
Employee shall be solely responsible for the costs of operating the foregoing
equipment. (NB. The computer must be returned to MacDermid immediately for
removal of all confidential information). Former Employee shall immediately
return the option agreement dated January 7, 2002 evidencing 200,000 optional
shares for cancellation. Former Employee shall also immediately return
MacDermid common stock certificate no. MCD 0376 for partial cancellation and
processing in accordance with this Agreement.
b. Former Employee acknowledges that he/she signed an Employee Agreement
with MacDermid and that the confidentiality and other obligations agreed to
there remain in full effect, unaltered by this Agreement.
c. Nothing contained in this Agreement will affect any vested pension,
profit sharing, or KSOP benefit, if any, that Former Employee now has.
d. Former Employee agrees that, except for discussions with his attorney as
encouraged in Article IV (e) hereof, and except as compelled by law, he will
maintain the confidentiality of the terms of this Agreement and the
circumstances regarding the termination of his employment. MacDermid will
maintain the terms of this Agreement as confidential, except that nothing herein
shall restrict MacDermid's ability to make reports and public releases necessary
to comply with MacDermid's legal reporting requirements. Former Employee will
make no voluntary statement or take any action that might reasonably be expected
to result in disclosure of, or any publicity concerning, this Agreement, the
terms hereof, or the termination of his employment. MacDermid will use
reasonable efforts to avoid voluntary statements that would reasonably be
expected to disparage the Former Employee. Further Former Employee agrees that
he will not, for at least
18 months after the effective date of this Agreement, make any statement that
disparages, or reasonably could be expected to disparage, MacDermid or its
employees, officers or directors. Former Employee agrees that, during the
period of 18 months from the effective date of this agreement, he will limit his
comments and communications regarding MacDermid and/or its employees, officers
and directors to the following statement:
"In the brief time that I worked at MacDermid, I came to recognize the unique
culture of this company. This culture provides the foundation for success at
MacDermid. Underlying the entrepreneurial approach is a low cost, owners'
mentality that drives employees to make the best decisions for MacDermid in
order to maximize cash flow. The key economic measurement espoused by all is
owner earnings. It is the common denominator which helps drive consistent
behavior towards improving cash flow. It is a focus on intrinsic value, not
book earnings that provides the financial goals for the future.
Clearly, my decision to leave MacDermid was not based on anything wrong at the
company, but due to a change in strategy from when I was hired. This new
strategic direction as described in Dan's shareholder letter is less risky since
it requires lower financial leverage, relies less on major acquisition growth,
and can be sufficiently met with few additions to the senior leadership team.
It is a more moderate path to increasing shareholder value than was contemplated
upon my hiring.
To the best of my knowledge, there are no major accounting issues at MacDermid.
That view is based on my observations during the 8 months that I worked at the
company. I do believe that Xxxx Xxxxxxxxxxx provides strong financial
controllership skills to MacDermid. At the epicenter of the company's internal
controls is the ownership culture which is so strong at MacDermid. It is this
owners' mentality which causes people to do the right thing for the good of the
clan."
MacDermid and Former Employee will agree upon a public statement to be issued on
the effective date of this Agreement regarding the Former Employee's
resignation, however, nothing herein shall restrict MacDermid's ability to make
reports and public releases necessary to comply with MacDermid's legal reporting
requirements. Former Employee further agrees for at least 18 months after the
effective date of this Agreement he will not assist, attempt to assist or
provide information to any person, group, or analyst that is analyzing,
reporting on or considering making an investment in MacDermid.
e. Former Employee acknowledges that he has been given a reasonable period
of time of at least twenty-one (21) days to review and consider this Agreement
before signing it. FORMER EMPLOYEE IS ENCOURAGED TO CONSULT WITH HIS OR HER
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ATTORNEY PRIOR TO SIGNING THIS AGREEMENT. The Former Employee may rescind this
--
Agreement by written notice to MacDermid, accompanied by repayment of any
consideration paid, received by MacDermid, within seven (7) days of the Former
Employee's execution of this Agreement. Time is of the essence. If not
rescinded within the foregoing seven (7) day period this Agreement shall be
irrevocable and final.
ARTICLE V (GENERAL PROVISIONS)
---------------------------------
a. Entire Agreement - This Agreement is intended as a final expression of
the agreement between MacDermid and Former Employee and as a complete and
exclusive statement of the terms and provisions thereof. This Agreement
supersedes any prior agreements between the parties unless otherwise noted
herein. No course of prior dealings shall be relevant. No representations,
understandings or agreements have been made or relied upon in the making of this
Agreement other than those specifically set forth herein. This Agreement can
only be modified in writing signed by both parties hereto. The parties
expressly represent and warrant that this Agreement was executed solely upon the
written content of this Agreement and is not based upon any promise,
representation or statement which is not stated in this Agreement.
b. Invalid Clauses - It is understood and agreed that if any terms or
provisions of this Agreement shall contravene or be invalid under the laws of
the United States, such contravention or invalidity shall not invalidate the
whole Agreement, but it shall be construed and enforced as to most nearly give
effect to the intentions of the parties as expressed herein as possible.
c. Enforcement - The failure of any party to insist on any one or more
instances upon strict performance of any term or provision of this Agreement
shall not be construed as a waiver or relinquishment of the terms, provisions,
covenants and conditions herein contained, but the same shall continue and
remain in full force and effect.
d. Choice of Law and Jurisdiction - All disputes, differences, or questions
arising out of this Agreement or as to the rights and liabilities of the parties
hereto or as to the construction or interpretation hereof shall be governed by
and interpreted in accordance with the internal laws of the State of Connecticut
and the parties hereby submit to the jurisdiction of the Federal and State
Courts located within the State of Connecticut and agree that any action brought
concerning enforcement of this Agreement or subjects contained herein shall be
brought only in courts located in the State of Connecticut.
e. Complete Defense - Former Employee agrees and acknowledges that this
Agreement and its releases can be pleaded as a full and complete defense and can
be used for the basis of an injunction against any action or any other
proceeding which may subsequently be instituted, prosecuted or attempted by
Former Employee, which is based upon any matter related to Former Employee's
employment with, relationship with, or business dealings with MacDermid or any
MacDermid affiliate or employees thereof or the termination of that employment,
relationship or dealings, or which is based in whole or in part upon any matter
covered, related to or referred to in this Agreement. A breach of this
Agreement shall not void the release provided for herein.
In witness whereof MacDermid and Former Employee have caused this Agreement to
be made and executed as of the days and dates indicated below:
MacDermid Incorporated Xxxx X. Xxxxxxxxxx
By: _____________________________ ___________________________
Date:____________________________ Date: __________________________
