TRANSITION AGREEMENT
Exhibit 10.1
This Transition Agreement (“Agreement”) is entered into on April 1, 2010, between Fuel Tech, Inc.,
a Delaware corporation (“Fuel Tech” or “Company”) and Xxxxxx X. Xxxxxx Xx. (“Xx. Xxxxxx”). Each of
Fuel Tech and Xx. Xxxxxx, intending to be legally bound, agree as follows:
| 1. | Transition Duties. Effective immediately, Xx. Xxxxxx resigns from his position as President and Chief Executive Officer of Fuel Tech. From the date of this Agreement until May 20, 2010 (the “Transition Period”), Xx. Xxxxxx will remain employed by Fuel Tech in the capacity of Executive Advisor, reporting directly to the interim President and Chief Executive Officer of Fuel Tech, and will assist in such matters as may be requested by him or his designate during the Transition Period. Through the end of the Transition Period, Xx. Xxxxxx will continue to receive his current monthly base salary, and shall continue to participate in the Fuel Tech 401(k) Plan and other health and welfare benefits extended to Fuel Tech domestic U.S. employees generally in accordance with the terms and conditions of each of the health and welfare benefit plans through which such benefits are made available to such employees. On May 20, 2010, Xx. Xxxxxx shall retire from Fuel Tech. | |
| 2. | Director Status. Xx. Xxxxxx will continue to serve as a director on the Board of Directors of Fuel Tech until May 20, 2010. With respect to those subsidiaries or affiliated companies of Fuel Tech for which Xx. Xxxxxx currently serves as a director or in any other legal capacity, Xx. Xxxxxx will continue to serve in each such capacity for each of those subsidiaries or affiliated companies until requested by the Company to resign or May 20, 2010, whichever occurs first. | |
| 3. | Separation Agreement. On May 20, 2010, Fuel Tech and Xx. Xxxxxx will enter into the Separation Agreement attached as Exhibit A to this Agreement. |
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.
By: |
/s/ Xxxxxxx X. Xxxxxx | /s/ Xxxxxx X. Xxxxxx Xx. | ||||||||
| Xxxxxxx X. Xxxxxx | Xxxxxx X. Xxxxxx Xx. | |||||||||
| Chairman of the Board |
EXHIBIT A
SEPARATION AGREEMENT
This Separation Agreement (“Agreement”) is made and entered into as of the date indicated
below between Fuel Tech, Inc. (“Fuel Tech” or the “Company”) and Xx. Xxxxxx X. Xxxxxx Xx. (“Xx.
Xxxxxx”).
Fuel Tech and Xx. Xxxxxx wish to provide for the termination of their employment relationship
and all agreements that may have existed between them, and fully and finally to settle all matters
encompassed by the release set forth below, without any admission of any kind by either party.
Therefore, in consideration of the mutual promises and agreements set forth in this Agreement,
Fuel Tech and Xx. Xxxxxx agree as follows:
I. EMPLOYMENT SEPARATION
A. Separation Date. Effective May 20, 2010 (“Separation Date”), Xx. Xxxxxx agrees
that he resigned his employment and all offices and positions within the Company and with any
affiliated or related entities of the Company including, but not limited to, the position of
Executive Advisor. As of the Separation Date, Xx. Xxxxxx shall be deemed to have retired from the
Company.
B. Separation. Effective on the Separation Date, Xx. Xxxxxx shall have no duties and no
authority to make any representations or commitments on behalf of the Company as an employee of the
Company or in any capacity whatsoever. Thereafter, Xx. Xxxxxx shall have no further rights
deriving from his employment by the Company, and shall not be entitled to any further compensation
or non-vested benefits, except as provided in this Agreement.
II. CONSIDERATION
In exchange for the promises contained in Section III, and the Waiver and Release of Claims
and Covenant Not To Xxx set forth in Section IV, and subject to the terms and conditions set forth
in this Agreement, Fuel Tech agrees to provide Xx. Xxxxxx with the compensation set forth in this
Section II (“Consideration”).
X. Xxxxxxxxx Payment.
1. Fuel Tech will pay Xx. Xxxxxx a total severance payment amount equal to Five
Hundred Thousand Dollars ($500,000.00) (the “Severance Payment”). The Severance Payment shall be
paid in equal installments twice a month, on or about the 1st and 15th day
of the month, over a period of twelve (12) months, until the Severance Payment is fully paid.
Subject to Fuel Tech’s internal deadlines for submitting payroll requests, the first Severance
Payment installment shall be paid on or about the 1st or 15th day of the
calendar month, as applicable, after the expiration of the Revocation Period (as that term is
defined below). Xx. Xxxxxx will cease to be eligible for any Fuel Tech benefits (other than those
specifically described herein) as of the Separation Date.
2. Xx. Xxxxxx acknowledges that continuation healthcare coverage under the
Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”) can provide for
continued group health coverage to eligible employees and their dependents. In the event, in
accordance with COBRA requirements and to the extent provided by COBRA, Xx. Xxxxxx elects to
enroll in COBRA to continue his medical, dental, or vision healthcare coverages that were in
effect through the Company’s group healthcare plans as of the day preceding the Separation Date,
Fuel Tech shall reimburse Xx. Xxxxxx his out of pocket COBRA premium cost actually paid by him
that is associated with his acquiring those COBRA benefits for a period of eighteen (18) months
from the Separation Date (“Reimbursement Period”). Otherwise, all costs and expenses incurred by
Xx. Xxxxxx associated with continuing COBRA coverage after the Reimbursement Period shall be his
sole responsibility and at his sole cost and expense. Each COBRA premium reimbursement request
submitted by Xx. Xxxxxx shall be paid by Fuel Tech within thirty (30) days after its receipt
provided that the reimbursement request is accurate, in a form and substance required by Fuel
Tech, and accompanied by suitable supporting documentation as requested by Fuel Tech.
B. Acknowledgment. Xx. Xxxxxx acknowledges that the Consideration provided in this
Agreement is good and valuable consideration in exchange for this Agreement, and includes payments
to which Xx. Xxxxxx is not otherwise entitled.
C. Withholding. The Company will withhold from each Severance Payment installment
payment payable to Xx. Xxxxxx under Section II of this Agreement all appropriate deductions for
employee benefits, if applicable, and the amounts necessary for the Company to satisfy its
withholding obligations under applicable federal, state and local laws, rules and regulations.
D. Revocation. Xx. Xxxxxx’ receipt of the Consideration including,
without limitation, the Severance Payment, is conditioned upon his unrevoked execution of the
Agreement and acceptance of the general waiver, release and covenant not to xxx contained within
the Agreement. Xx. Xxxxxx acknowledges and agrees that he has had at least twenty-one (21) days
before the Separation Date to review the Agreement and seven (7) days after executing it to revoke
the execution (the “Revocation Period”). If the execution is revoked, then Xx. Xxxxxx will not be
entitled to receive the Consideration. Xx. Xxxxxx must provide written notice of the revocation of
the executed Agreement to Xxxxxx X. Xxxxxxxx, Vice President, General Counsel & Secretary of Fuel
Tech, Inc. within the seven (7) day Revocation Period.
III. XX. XXXXXX’ COVENANTS TO FUEL TECH
The parties desire to provide for the protection of the business, good will, confidential
information, relationships and other proprietary rights of Fuel Tech. Accordingly, Xx. Xxxxxx
agrees to the following:
A. Property of Fuel Tech. By the Separation Date, Xx. Xxxxxx will return to Fuel Tech
all Company property including, but not limited to, all business cards, identification cards,
files, computer hardware, software, equipment and disks, keys, Company owned or leased vehicles,
credit cards, and records.
B. Cooperation. After the Separation Date, Xx. Xxxxxx agrees to make himself
reasonably available to Fuel Tech to respond to requests for information pertaining to or relating
to the Company or any of its agents, officers, directors or employees, that may be within the
knowledge of Xx. Xxxxxx. Xx. Xxxxxx will cooperate fully in connection with any and all existing
or future depositions and/or litigations or investigations brought by or against Fuel Tech, Xx.
Xxxxxx or any of the Company’s agents, officers, directors or employees, whether administrative,
civil or criminal in nature, in which and to the extent the Company deems Xx. Xxxxxx’
cooperation necessary. In the event that Xx. Xxxxxx is subpoenaed in connection with any
litigation or investigation involving the Company, he will immediately notify Fuel Tech, and shall
give the Company an opportunity to respond to such notice before taking any action or making any
decision in connection with such subpoena. Any violation of this Subsection will be deemed to be a
material breach of this Agreement. In addition to any other remedies available to Fuel Tech at law
or equity, a violation of this Subsection by Xx. Xxxxxx will also authorize the Company to
terminate any payments under this Agreement, and will obligate him to return all monies paid to him
hereunder.
C. Confidential Information. Xx. Xxxxxx acknowledges that he has had access to
confidential Company business information, including, but not limited to, future business plans and
financial information (“Confidential Information”) and which is not generally known outside the
Company. For all time, Xx. Xxxxxx agrees that he shall not, without the proper written
authorization of the Company, directly or indirectly use, divulge, furnish or make accessible to
any person any Confidential Information, but instead shall keep all Confidential Information
strictly and absolutely confidential. Xx. Xxxxxx will use reasonable and prudent care to safeguard
and prevent the unauthorized use or disclosure of Confidential Information. Xx. Xxxxxx shall
return to Fuel Tech all Confidential Information, including but not limited to any and all copies,
reproductions, notes or extracts of Confidential Information.
D. Non-Solicitation/Competition. For twelve (12) months following the Separation
Date, Xx. Xxxxxx agrees that he will not, directly or indirectly, as an employee, agent, member,
director, partner, consultant or contractor or in any other individual or representative capacity:
(i) solicit any “Protected Individual,” as defined below, for other employment or engagement,
induce or attempt to induce any Protected Individual to terminate his or her employment, hire or
engage any Protected Individual, or otherwise interfere or attempt to interfere in any way in the
relationship between Fuel Tech and such Protected Individual; or (ii) engage anywhere in the United
States in any activity competitive with the “Business of Fuel Tech,” as defined below. For
purposes of this Agreement, “Protected Individual” means an individual who is or was an employee,
consultant or contractor of Fuel Tech and with whom Xx. Xxxxxx had business contact at any time
during Xx. Xxxxxx’ employment or about whom Xx. Xxxxxx received Confidential Information; provided
that a former employee, consultant or contractor will only be considered a “Protected Individual”
for six (6) months after the last date he or she was employed by or provided services to Fuel Tech.
Also for purposes of this Agreement, “Business of Fuel Tech” means air pollution control; the
development and use of specialty chemicals for improving the efficiency, reliability, and
environmental status of plants operating in the electric utility, industrial, pulp and paper, and
waste-to-energy markets; and any other business activity as of the Separation Date that Fuel Tech
conducts or has expended significant time and resources preparing to conduct (provided such
preparations were known to Xx. Xxxxxx during his employment).
Further, Xx. Xxxxxx expressly acknowledges that the terms of this Subsection are material to
this Agreement, and if Xx. Xxxxxx breaches the terms of this Subsection, Xx. Xxxxxx shall be
responsible for all damages and, at the election of Fuel Tech, the return of all consideration
allocated thereto, as described in the various Subsections of this Section, without prejudice to
any other rights and remedies that Fuel Tech may have.
In addition, Xx. Xxxxxx acknowledges and agrees that the Confidential Information and special
knowledge acquired during Xx. Xxxxxx’ employment with the Company is valuable and
unique, and that breach by Xx. Xxxxxx of the provisions of this Agreement as described in this
Subsection will cause the Company irreparable injury and damage, and that the Company cannot be
reasonably or adequately compensated by money damages for such injury and damage. Xx. Xxxxxx,
therefore, expressly agrees that the Company shall be entitled to injunctive or other equitable
relief in order to prevent a breach of this Agreement or any part thereof, in addition to such
other remedies legally available to the Company. Xx. Xxxxxx expressly waives the claim that the
Company has an adequate remedy at law.
IV. GENERAL WAIVER, RELEASE AND COVENANT NOT TO XXX
X. General Waiver and Release by Xx. Xxxxxx.
1. As a material inducement to Fuel Tech to enter into this Agreement, and in
consideration of Fuel Tech’s promise to make the payments set forth in this Agreement, except for
Fuel Tech’s obligations to Xx. Xxxxxx under that certain Indemnity Agreement dated December 7,
2006 between Xx. Xxxxxx and the Company, Xx. Xxxxxx hereby knowingly and voluntarily releases and
forever discharges Fuel Tech, and all of its affiliates, parents, subsidiaries and related
entities, and all of its past, present and future respective agents, officers, directors,
shareholders, employees, attorneys and assigns from any federal, state or local charges, claims,
demands, actions, liabilities, suits, or causes of action, at law or equity or otherwise and any
and all rights to or claims for continued employment after the Separation Date, attorneys fees or
damages (including contract, compensatory, punitive or liquidated damages) or equitable relief,
which he may ever have had, has now or may ever have or which Xx. Xxxxxx’ heirs, executors or
assigns can or shall have, against any or all of them, whether known or unknown, on account of or
arising out of Xx. Xxxxxx’ employment with Fuel Tech or his separation from the Company.
2. This release includes, but is not limited to rights and claims arising under
Title VII of the Civil Rights Act of 1964, as amended, the Americans with Disabilities Act,
Employee Retirement Income Security Act, the Age Discrimination in Employment Act (“ADEA”) as
amended by the Older Workers Benefit Protection Act, the Fair Labor Standards Act, any state or
local human rights statute or ordinance, any claims or rights of action relating to breach of
contract, public policy, personal or emotional injury, defamation, additional compensation, or
fringe benefits. Xx. Xxxxxx specifically waives the benefit of any statute or rule of law that, if
applied to this Agreement, would otherwise exclude from its binding effect on any claims not now
known by Xx. Xxxxxx to exist. This release does not purport to waive claims arising under these
laws after the date of this Agreement. If the release provisions of Section IV are held invalid
for any reason whatsoever, Xx. Xxxxxx agrees to execute such documents as may be necessary to make
the release provisions valid or, at the option of the Company, agrees to return any consideration
received under the terms of this Agreement and that the Company is released from any obligations
under this Agreement.
B. Covenant Not to Xxx. Xx. Xxxxxx covenants and agrees not to xxx or bring any
action, whether federal, state, or local, judicial or administrative, now or at any future time,
against Fuel Tech, its affiliates, parents, subsidiaries, or its or their related entities or its
or their respective agents, directors, officers or employees, with respect to any claim released
hereby. Nevertheless, this Agreement does not purport to limit any right Xx. Xxxxxx may have to
file a charge under the ADEA or other civil rights statute or to participate in an investigation or
proceeding conducted by the Equal Employment Opportunity Commission or other investigatory agency
(each an “Enforcement Agency”). This Agreement does, however, waive and release any
right Xx. Xxxxxx may have to recover individual damages in any future proceeding conducted by
an Enforcement Agency on his behalf.
V. NON-DISPARAGEMENT
Xx. Xxxxxx agrees not to make any statement to any third party that disparages or defames the
products, services, operations or policies of Fuel Tech, or its subsidiaries or their affiliated
companies, or any of the officers, directors, or employees of any of them (collectively “Fuel Tech
Parties”). Fuel Tech agrees to use commercially reasonable efforts to advise its senior officers
to not, in the course and scope of their employment, make any statement to any non-Fuel Tech
Parties that disparages or defames Xx. Xxxxxx. Xx. Xxxxxx agrees that the preceding sentence shall
not prevent any of the Fuel Tech Parties from making references concerning or otherwise discussing
the business performance of any of the Fuel Tech Parties during Xx. Xxxxxx’ tenure to any non-Fuel
Tech Parties or making any disclosures required by law. If either party materially breaches this
Section V, the non-breaching party shall be entitled to all rights and remedies permitted by law.
VI. MISCELLANEOUS PROVISIONS
A. Venue and Choice of Law. This Agreement shall be governed by the laws of the State
of Illinois except for its conflict of law provisions. The parties agree that the exclusive venue
for enforcement of this Agreement shall be in any state court of DuPage County, Illinois or the
United States District Court for the Northern District of Illinois, at the choice of the enforcing
party and subject to any removal rights either party may enjoy. Both parties waive any objections
they may have and give their consent to venue and personal jurisdiction in these courts.
B. Amendment. Any amendment to this Agreement shall only be made in writing and
signed by the parties.
C. Waiver. No claim or right arising out of a breach or default under this Agreement
can be discharged by a waiver of that claim or right unless the waiver is in writing signed by the
party hereto to be bound by such waiver. A waiver by any party of a breach or default by the other
party of any provision of this Agreement shall not be deemed a waiver of future compliance with
such provision, and such provision shall remain in full force and effect.
D. Notice. All notices, requests, demands and other communications under the
Agreement shall be in writing and delivered in person or sent by certified mail, postage prepaid,
and properly addressed as follows:
To Xx. Xxxxxx X. Xxxxxx Xx:
0000 Xxxxxxx Xxxxx
Xxxxxxxx, Xxxx 00000
0000 Xxxxxxx Xxxxx
Xxxxxxxx, Xxxx 00000
To Fuel Tech:
With a copy to: Xxxxxx X Xxxxxxxx, Vice President,
General Counsel & Secretary at the same Fuel Tech address
General Counsel & Secretary at the same Fuel Tech address
The parties agree to notify each other promptly in writing of any change in mailing address.
E. Payment in the Event of Death. In the event of Xx. Xxxxxx’ death after the
Separation Date and his unrevoked execution of this Agreement, any part of the Severance Payment
that has not yet been paid to him will be paid to his estate in a manner as required by law.
F. Entire Agreement. Fuel Tech and Xx. Xxxxxx each represent and warrant that no
promise or inducement has been offered or made except as set forth in this Agreement, and that the
consideration stated in this Agreement is the sole consideration for this Agreement. This
Agreement is a complete agreement and states fully all agreements, understandings, promises and
commitments as between Xx. Xxxxxx and the Company as to the separation of Xx. Xxxxxx from
employment by Fuel Tech. This Agreement supersedes any prior agreements, whether oral or written,
between Xx. Xxxxxx and Fuel Tech as to its subject matter. Except as expressly provided herein,
Xx. Xxxxxx is not entitled to any other or further compensation or remuneration.
G. Limited Severability. If any Section or Subsection of this Agreement is found by a
court of competent jurisdiction to be invalid or unenforceable, in whole or in part, then such
provision shall be deemed to be modified or restricted in the manner necessary to render the same
valid and enforceable, and this Agreement shall be construed and enforced to the maximum extent
permitted by law, if any.
H. Voluntary Agreement and Advice of Counsel. Xx. Xxxxxx hereby certifies that he has
read the terms of this Agreement, that he has been informed by Fuel Tech, through this document,
that he should discuss this Agreement with an attorney of his own choice, and that he understands
its terms and effects. Xx. Xxxxxx further certifies that he has the intention of performing his
obligations under this Agreement in exchange for the Consideration described herein, which he
acknowledges as adequate and satisfactory to him. Neither the Company nor any of its agents,
representatives or attorneys have made any representations to Xx. Xxxxxx concerning the terms or
effects of this Agreement or the general waiver, release and covenant not to xxx it provides for
other than those contained herein.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the dates set forth
below. The effective date of this Agreement (“Effective Date”) shall be the last signature date
shown below.
Xx. Xxxxxx X. Xxxxxx Xx.
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Fuel Tech, Inc. | |||||
| By: | ||||||
| Its: | ||||||
Date:
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Date: | |||||
