RETIREMENT AGREEMENT
Exhibit
10.1
This
RETIREMENT AGREEMENT
(“Agreement”)
is made
and entered into by and between SEMCO
ENERGY, INC.
(the
“Company”) and XXXX
X. XXXXXXXXX
(the
“Chairman”), to become effective upon the execution and approval
thereof.
WHEREAS,
the
Chairman desires to retire as Chairman and a member of the Company’s Board of
Directors, effective as of date upon which this Agreement is approved by the
Board of Directors (the “Retirement Date”); and
WHEREAS,
in light
of Chairman’s retirement and in appreciation of the significant contributions
that the Chairman has made to the Company, the Company and the Chairman desire
to enter into this Agreement.
NOW,
THEREFORE,
in
consideration of the premises and the agreements of the parties set forth in
this Agreement, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending
to
be legally bound, hereby covenant and agree as follows:
1. Retirement. Chairman
shall retire as Chairman and a member of the Board of Directors effective as
of
the Retirement Date.
2. Retainer.
As soon
as practicable following the later of the Retirement Date and the effective
date
of this Agreement, the Company shall pay to the Chairman a lump sum payment
in
the amount of Eight Thousand, Seven Hundred and Fifty Dollars ($8,750). This
payment represents a portion of the cash retainer that the Chairman would have
otherwise received had he remained a member of the Company’s Board of Directors
for the remainder of his term.
3. Restricted
Stock.
(a) Pursuant
to the terms of (i) the SEMCO Energy, Inc. 2004 Stock Award and Incentive Plan
(the “Incentive Plan”), (ii) the Restricted Stock Grant Agreement for Chairman
entered into by and between the Company and the Chairman on June 28, 2005 (the
“2005 Chairman Grant Agreement”), and (iii) the Restricted Stock Grant Agreement
for Chairman entered into by and between the Company and the Chairman on May
22,
2006 (the “2006 Chairman Grant Agreement”), the Company acknowledges and agrees
that the Five Thousand, Two Hundred and Fifty (5,250) shares of Restricted
Stock
that were granted pursuant to the 2005 Chairman Grant Agreement and the Five
Thousand (5,000) shares of Restricted Stock that were granted pursuant to the
2006 Chairman Grant Agreement shall become one hundred percent (100%) vested
upon the Chairman’s retirement on the Retirement Date.
(b) In
light
of Chairman’s retirement, pursuant to Section 4(d) of the Incentive Plan, the
Company deems Seven Thousand (7,000) shares of Restricted Stock that were
granted pursuant to the Restricted Stock Grant Agreement for Directors dated
June 28, 2005, by and between the Company and the Chairman one hundred percent
(100%) vested effective upon the Chairman’s retirement on the Retirement
Date.
4. Release.
The
Chairman does
hereby remise, release and forever discharge the Company and its officers,
directors, employees, agents, shareholders, parent corporation, subsidiaries,
and affiliates, and their respective predecessors, successors, assigns, heirs,
executors and administrators (collectively, “Releasees”), of and from all manner
of actions and causes of action, suits, debts, claims and demands whatsoever
at
law or in equity, known or unknown, actual or contingent, including, but not
limited to, any claims which have been asserted, or could be asserted now or
in
the future, against any Releasees arising under any and all federal, state
or
local laws and any common law claims, and including, but not limited
to:
(a) Employee
Retirement Income Security Act;
(b) claims
for violations of any other federal or state statute or regulation or local
ordinance;
(c) claims
for lost or unpaid compensation or benefits, defamation, intentional or
negligent infliction of emotional distress, assault, battery, fraud,
misrepresentation, conversion, tortious interference, breach of contract, or
breach of fiduciary duty; and
(d) any
other
claims under state law arising in tort or contract.
5. No
Assignment of Claim.
The
Chairman represents that he has not assigned or transferred, or purported to
assign or transfer, any claims or any portion thereof or interest therein to
any
party prior to the date of this Agreement.
6. Non-Disclosure
of Confidential Information.
(a) Chairman
acknowledges and agrees that the information, observations and data obtained
by
him during the course of his service as a director of the Company is the
property of the Company. Therefore, Chairman for a period of three (3) years
after the Retirement Date, (a) shall hold in a fiduciary capacity and in
strict confidence for the benefit of the Company, its subsidiaries and
affiliates all Confidential Information (as defined below), and (b) without
the prior written consent of the Board or except to the extent required by
law
(and upon prompt written notice of such requirement to the Company), shall
not
directly or indirectly, divulge, furnish, disclose, use for his own purposes
or
make accessible to any others for any purpose any Confidential Information.
Chairman acknowledges and agrees that the disclosure of any Confidential
Information will be damaging or harmful to the business activities of the
Company, its subsidiaries and affiliates, and that such disclosure can direct
or
divert corporate opportunities, product sales and/or profits away from the
Company, its subsidiaries or affiliates. In the event Chairman shall be required
by law to make any disclosure as set forth above, Chairman shall promptly notify
the Company and any subsidiary or affiliate which may reasonably be affected
by
such disclosure and shall cooperate with the Company, such subsidiary and such
affiliate to preserve in full the confidentiality of all Confidential
Information of the Company, such subsidiary or such affiliate. Confidential
Information shall be considered confidential or proprietary unless and to the
extent that such Confidential Information becomes generally known to and
available for use by the public other than as a result of any act or omission
to
act by Chairman. Chairman will take all appropriate steps to safeguard
Confidential Information and to protect it against disclosure, misuse,
espionage, loss and theft.
(b) Not
withstanding the foregoing, the Chairman further understands and agrees that
the
federal and state securities laws prohibit any person who has received from
an
issuer material, non-public information from purchasing or selling securities
of
such issuer or from communicating such information to any other person under
circumstances in which it is reasonably foreseeable that such person is likely
to purchase or sell such securities.
(c) As
used
in this Agreement, the term “Confidential
Information”
means
information that is used, developed or obtained by the Company or any of its
subsidiaries and affiliates in connection with the Company’s or such
subsidiary’s or affiliate’s business, including but not limited to
(i) business plans, strategies and opportunities, (ii) products or
services, (iii) fees, costs, pricing structures and budgets,
(iv) research and development, (v) accounting and business methods,
(vi) all technology and trade secrets, (vi) intellectual property,
unique business information or confidential or proprietary information, and
(vii) all similar and related information in whatever form. Confidential
Information will not include any information that has been published in a form
generally available to the public prior to the date Chairman proposes to
disclose or use such information. Information will not be deemed to have been
published merely because the existence of such information has been disclosed
or
individual portions of the information have been separately published, but
only
if all material features comprising such information have been published in
combination.
7. Publicity;
No Disparaging Statement.
In
accordance with normal ethical and professional standards and except with
respect to such matters described in 18 U.S.C. Section 1514A, the Chairman
shall
refrain from taking action or making statements, written or oral, which
disparage or defame the goodwill or reputation of the Company, its directors,
officers, or which could adversely affect the morale of its employees. In
addition, in accordance with normal ethical and professional standards, the
Company shall refrain from taking action or making statements, written or oral,
which disparage or defame the goodwill or reputation of the
Chairman.
8. Return
of Company Property.
Upon
the Retirement Date, the Chairman
agrees
to return to the Company all property of the Company, including but not limited
to data, lists, information, memoranda, documents, identification cards, parking
cards, keys, computers, fax machines, beepers, phones, files and any and all
written or descriptive materials of any kind belonging or relating to the
Company, including, without limitation, any originals, copies and abstracts
containing any Confidential Information in the Chairman’s possession or
control.
9. Entire
Agreement. This
Agreement shall constitute the full and complete agreement between the parties
concerning its subject matter and fully supersedes any and all other prior
agreements or understandings between the parties concerning the subject matter
hereof. This Agreement shall not be modified or amended except by a written
instrument signed by both the Chairman and an authorized representative of
the
Company.
10. Remedies.
The
Chairman and the Company acknowledge and agree that any violation of Section
6
and/or Section 7 of this Agreement would result in irreparable injury for which
monetary damages would be an inadequate remedy. Therefore, the Chairman and
the
Company shall each be entitled as a matter of right to seek an injunction to
prevent a breach of the covenants and obligations set forth in Section 6 and
Section 7 of this Agreement and such right shall be cumulative and in addition
to any other remedies which may be available.
11. Applicable
Law.
This
Agreement shall be construed and interpreted in accordance with the laws of
the
State of Michigan (without giving effect to principles of conflicts of law),
to
the extent such laws are not otherwise superseded by the laws of the United
States.
[SIGNATURES
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IN
WITNESS WHEREOF,
the
parties hereto have executed this Agreement, as of this 9th
day of
October, 2006.
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The
Company:
SEMCO
ENERGY, INC.
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| October 9, 2006 | By: | /s/ Xxxxxxx X. Xxxxxxx |
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| Its: | Senior Vice President and Chief Financial Officer | |
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The
Chairman:
XXXX
X. XXXXXXXXX
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| October 9, 2006 | /s/ Xxxx X. Xxxxxxxxx | |
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