EXHIBIT 10.5
[LETTERHEAD OF VR]
DATE October 27, 1999
TO Xxxxxxx X. Xxxx
SUBJECT Retirement/Part-Time Employment Agreement
In consideration of your long-term employment with Anacomp, Inc. ("Anacomp"
or the "Company") and your continuing value to the Company, and in recognition
of your desire to cease full-time employment upon attaining age 60, Anacomp
offers you the following:
1. Your full-time employment with Anacomp will cease on December 31,
1999.
2. Beginning January 1, 2000, you will be available to Anacomp on a
part-time basis to work on special projects assigned by the CEO, for at least
ten (10) days per month during the first year (2000), and at least five (5) days
per month during the second year (2001).
3. For the above service, Anacomp will pay you $1,500/day. In 2000, you
will be paid for a minimum of ten (10) days per month and in 2001, you will be
paid for a minimum of five (5) days per month.
4. Your bonus for the first quarter of FY2000 will be paid at the same
percent as the CEO on the regularly scheduled pay date in February, 2000.
5. Your termination date will be December 31, 2001 (the "Termination
Date").
6. You will be entitled to all employee benefits including the Executive
Health Plan through your Termination Date, except that vacation accrual will
cease on December 31, 1999. You will be paid for any earned but unused vacation
on the pay date of January 20, 2000.
7. Your laptop reimbursement will continue through the end of the
three-year reimbursement period.
8. The fourth installment of 6,250 stock options with an exercise price
of $4.63 previously granted to you will vest on November 15, 1999. All stock
options must be exercised no later than December 31, 2002.
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9. The Employment Agreement between Anacomp and yourself dated December
16, 1992, will terminate on December 31, 1999 and will be of no further force or
effect after such date, except for those provisions which by their nature
survive such termination. (For the avoidance of doubt, you expressly agree that
Addendum II to the Employment Agreement, "Employee's Covenant Not to Compete or
Disclose Trade Secrets", will survive the termination of the Employment
Agreement.) Upon the termination of the Employment Agreement, you will be paid
the compensation fees in accordance with item number 3 above, in lieu of any
severance or other compensation to which you would be entitled pursuant to
Article II of the Employment Agreement, and you expressly waive your right to
receive such severance or other compensation.
10. If, prior to December 31, 1999, your employment with Anacomp is
terminated pursuant to Article V of your Employment Agreement, then the
provisions of Articles V and VI thereof shall govern and this letter agreement
shall be immediately terminated and of no further force or effect.
11. The "Confidentiality, Non-Competition and Non-Disclosure Agreement"
dated October 2, 1996, that you executed in connection with the grant of the
stock options referenced in the first sentence of item number 7 above, remains
in full force and effect in accordance with its terms and will survive any
termination of your Employment Agreement or this letter agreement.
12. This letter agreement may only be modified by mutual written agreement
between the CEO of the Company and yourself. This letter agreement shall be
governed by the laws of the State of California, without regard to its conflict
of laws.
Please sign below to indicate your acceptance of the terms and conditions
of this letter agreement.
Best regards,
Xxxxx X. Xxxxxxx
President and CEO
AGREED TO AND ACCEPTED:
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Xxxxxxx X. Xxxx Date
