September 2, 2003
Xx. Xxxx X. Xxxxxx
< Address >
Dear Xxxx:
This letter agreement (the "Agreement") details the understanding that TriMas
Corporation ("TriMas") and you have reached regarding the termination of your
employment with TriMas, and the benefits that TriMas is willing to provide you
as consideration for the execution of this Agreement. Please review it carefully
to make sure you are in complete agreement.
1. Employment and Severance Benefits
Your employment with TriMas terminates on September 2, 2003 (the "Termination
Date"). As consideration for the execution of this Agreement, XxxXxx agrees to
pay you the Severance Benefits described below.
(a) Base salary continuation for a period of twenty-four (24) months following
the Termination Date at the annual base salary rate in effect on the
Termination Date. Payments will be made in equal, bi-weekly installments,
less applicable withholding and payroll taxes. (The gross amount of this
salary continuation is Six Hundred and Eighty Thousand Dollars ($680,000).
The gross amount per pay period will be $13,076.)
(b) A gross bonus equal to two hundred percent (200%) of the target bonus
opportunity under the Annual Value Creation Plan (AVCP), payable in equal
installments over the twenty-four (24) month period under the same payment
provisions described above. (The gross bonus amount for this purpose is
Four Hundred and Eight Thousand Dollars ($408,000). The gross amount per
pay period will be $7,846.15.) In addition, a pro rata bonus will be paid
for 2003 through the Termination Date calculated at one hundred percent
(100%) of the bonus opportunity for target performance under the AVCP. The
gross bonus amount for this purpose is One Hundred and Thirty-Six Thousand
Nine Hundred Thirty-One Dollars ($136,931), subject to all applicable
withholdings described above, paid as a single sum following the expiration
of the twenty-one day consideration period described below and the seven
day revocation period described in Section 9 below.
Xx. Xxxx X. Xxxxxx
September 2, 2003
Page 2
(c) Continuation of benefits under any group medical, dental, and life
insurance benefits substantially similar to those which you were receiving
immediately prior to termination of employment until the earlier of:
1. the end of the twenty-four (24) month period following the Termination
Date, or
2. the date on which you become eligible to receive any benefits under
any plan or program of any other employer.
TriMas will pay the employer-portion of the medical, dental, and life
insurance coverage. You will be required to pay the employee-portion
of the medical, dental, and life insurance premiums. The
employee-portion of the premiums will be billed to you on a monthly
basis. Health care continuation will be applied against the COBRA
notification period. If TriMas is not able to provide coverage under
the existing plans, you will be paid cash in the amount of the
TriMas's portion of the premium cost.
(d) Outplacement Services. TriMas shall pay reasonable and customary fees and
expenses for outplacement services for you with a provider selected by
TriMas. TriMas shall make direct periodic payments for such services to the
provider, as needed, provided that such payments shall not in the aggregate
exceed Twenty Thousand Dollars ($20,000).
(e) Company Car. You shall continue to participate in the TriMas Executive Car
Program for a period of twelve (12) months from the Termination Date in
accordance with the terms of that program.
(f) Vacation. Your right to vacation will cease on the Termination Date. Your
unused vacation for 2003 will be paid to you in a lump sum following the
expiration of the twenty-one day consideration period and seven day
revocation period described in Section 9 below.
(g) Termination of Accruals Under Retirement Plans. Notwithstanding anything to
the contrary set forth herein, you shall cease to be an active participant
under the TriMas Retirement Program and other benefit plans pursuant to the
terms of those plans, and no additional benefits shall accrue to you after
the Termination Date. No amounts paid under this Agreement shall constitute
compensation for purposes of any such retirement plan. Your rights to any
accrued and vested benefits under a qualified retirement plan shall be
determined in accordance with the applicable plan document.
Xx. Xxxx X. Xxxxxx
September 2, 2003
Page 3
(h) Taxes. Any payments made by TriMas hereunder are subject to applicable
federal, state and local tax withholding. You agree that you are
exclusively liable for the payment of any federal, state, city or other
taxes that may be due as a result of any benefits received by you as
provided in this Agreement. You further agree to indemnify and hold TriMas
harmless from any payment of taxes or penalties, if any, that may be
required of you as a result of any severance benefits received by you
pursuant to this Agreement. You may wish to consult with your financial or
tax advisor with regard to the tax implication of any benefits described in
this Agreement. You acknowledge and agree that no representations or
warranties have been made to you with regard to the tax consequences of any
payment provided for under this Agreement.
Payment of the amounts and benefits set forth in this Section 1 is in lieu of
any amounts that may otherwise be or become payable to you after the Termination
Date under the employment agreement between you and TriMas dated effective June
6, 2002 ("Employment Agreement") or any other agreement, plan, policy, or
program of TriMas, including, without limitation, any rights to a bonus under
the TriMas Annual Value Creation Plan ("AVCP") AND ANY CLAIM TO VESTED OR
UNVESTED OPTIONS TO ACQUIRE STOCK IN TRIMAS UNDER THE TRIMAS 2002 LONG TERM
EQUITY INCENTIVE PLAN ("INCENTIVE PLAN"), OR TO FUTURE GRANTS OF SUCH OPTIONS OR
CONVERSION OF ANY OPTIONS ISSUED BY METALDYNE CORPORATION INTO TRIMAS OPTIONS.
By signing this Agreement you waive and release all claims listed under Section
6, which includes a waiver and release of any and all claims for payments in any
form from the Employment Agreement, the AVCP, the Incentive Plan, and any other
TriMas severance or bonus plan that may exist or have existed prior to the date
of this Agreement. This Agreement supersedes the Employment Agreement in its
entirety, and the Employment Agreement shall terminate and have no further
effect upon the execution of this Agreement.
2. Non-Competition; Non-Solicitation; Confidentiality; Release Consideration.
You agree that you are subject to the restrictive covenants and remedies set
forth on Attachment A, which is hereby incorporated into and made part of to
this Agreement. You acknowledge that this Agreement provides additional and
sufficient consideration for the release contained herein.
3. Return of Property. You agree to immediately return all TriMas property (and
any copies of such property) of any kind and character, including, without
limitation, keys, credit cards, documents, computers, computer software, discs
and media, policy and procedures manuals and all other tangible or intangible
property of TriMas.
4. E-Mail and Computer Accounts. Access to TriMas e-mail services and other
computer systems will cease on the Termination Date.
Xx. Xxxx X. Xxxxxx
September 2, 2003
Page 4
5. Cooperation.
(a) You agree that you will not to in any way criticize, disparage, attempt
to discredit, demean or otherwise call into disrepute TriMas, or its respective
affiliates, successors, assigns, officers, directors, employees or agents, or
any of TriMas' products or services.
(b) You agree that you will not assist any party other than TriMas in any
claim, litigation, proceeding or investigation against TriMas or other Released
Parties (as defined below), except as required by law. You further agree that if
you believe any such action is required by law, you will first afford TriMas the
opportunity to raise and obtain a ruling on any claim of attorney-client or
other privilege, attorney work product protection, contractual or other defense
that may be applicable.
(c) You agree to provide, at TriMas' expense, your reasonable cooperation
to TriMas and the Released Parties in any existing or future claim, litigation,
proceeding, investigation or other judicial, administrative or legislative
matter in which your assistance may be desired by TriMas.
6. Release.
(a) You and TriMas, without any admission of liability, desire to settle
with finality, compromise, dispose of, and release all claims, demands, and
causes of action you have asserted or which you could assert against TriMas,
whether or not arising out of the Employment Agreement; any representations or
agreements relating to stock options; any agreement with a predecessor to
TriMas; the termination of your employment, under the Employment Agreement; your
employment relationship; the termination of the employment relationship; or any
condition or benefit of employment or otherwise. This Agreement is not and shall
not be construed as an admission by either party that your employment was
terminated voluntarily or involuntarily, with or without cause, or as an
admission by TriMas of any liability, an admission against interest, or any
violation of TriMas' policies or procedures.
(b) You, for yourself, and your heirs, executors, administrators,
successors and assigns, hereby release and forever discharge TriMas, its
affiliates and respective officers, directors, agents, representatives,
shareholders, employees (current and former), employee benefit plans,
successors, predecessors, including Metaldyne Corporation, assigns, and any and
all other persons, firms, corporations and other legal entities associated with
TriMas (collectively referred to as the "Released Parties"), of and from any and
all claims, demands, actions, causes of action, debts, damages, expenses, suits,
contracts, agreements, costs and liabilities of any kind, nature or description,
whether direct or indirect, known or unknown, in law or in equity, in contract,
tort or otherwise, which you ever had, now have or may have against any of the
Released Parties as of the date of execution of this Agreement, whether known or
unknown, suspected or
Xx. Xxxx X. Xxxxxx
September 2, 2003
Page 5
unsuspected, or which may be based upon pre-existing acts, claims or events
occurring at any time up to the present date including, but not limited to,
claims arising under the Employment Agreement, the Incentive Plan, or any other
written or oral agreement regarding compensation, benefits, or options or equity
grants, Title VII of the Civil Rights Act of 1964 or state civil rights
statutes, claims arising under the Age Discrimination in Employment Act of 1967
("ADEA"), as amended by the Older Workers Benefit Protection Act ("OWBPA"),
claims arising under the Americans with Disabilities Act ("ADA"), the Family and
Medical Leave Act ("FMLA"), the Fair Labor Standards Act ("FLSA"), the National
Labor Relations Act ("NLRA"), the Employee Retirement Income Security Act
("ERISA"), claims for breach of express or implied contract, breach of promise,
promissory estoppel, loss of income, back pay, reinstatement, front pay,
impairment of earning capacity, wrongful termination, defamation, libel,
slander, discrimination, damage to reputation, fraud, violation of public
policy, retaliation, negligent or intentional infliction of mental or emotional
distress, intentional tort or any other federal, state or local common law or
statutory claims, and all other claims and rights, whether in law or equity. It
is the intention of the parties that this paragraph will be construed as broadly
as possible; however, this paragraph does not include claims arising under state
workers' compensation laws, state unemployment laws and any claims that arise
after the signing of this Agreement. This paragraph also does not affect your
right to file a charge or otherwise participate in an EEOC proceeding insofar as
it is required by current EEOC regulations. You understand that XxxXxx will
assert this Agreement as an affirmative defense against any claim asserted by
you in any forum.
(c) In signing this Agreement, you agree to waive any rights you might have
to pursue any claims against TriMas through any alternative dispute resolution
process, or through any court or administrative agency, to the extent permitted
by law, and further agree not to bring any suit or action in any court or
administrative agency, to the extent permitted by law, against any of the
beneficiaries of this release arising out of or relating to the subject matter
of this release.
7. Nondisclosure. You agree to not disclose the existence of this Agreement or
any of its terms to any third parties other than your spouse, tax advisors,
accountants and attorneys, or as otherwise required by law. You agree that any
violation of this non-disclosure paragraph will result in substantial and
irreparable injury to TriMas.
8. References. In the event that you seek a reference for employment purposes,
you agree to direct inquiries to TriMas' Human Resources Department. References
to be provided by TriMas regarding you shall be limited to dates of employment,
positions held and compensation. Those making such inquiries will be advised
that it is the general policy of TriMas to provide only such neutral references
in response to employment inquiries.
9. Consideration Time and Revocation Period.
Xx. Xxxx X. Xxxxxx
September 2, 2003
Page 6
(a) Consistent with the ADEA, this Agreement was first given to you on
September 2, 2003. You have twenty-one (21) calendar days during which to review
and consider this offer. You are not required to, but may accept this Agreement
by signing and returning the Agreement at any time prior to September 23, 2003.
In the event you sign and return this Agreement before that time, you certify,
by such execution, that you knowingly and voluntarily waive the right to the
full twenty-one (21) days, for reasons personal to you, with no pressure by
XxxXxx to do so. TriMas and you further agree that any changes, whether material
or immaterial, to this Agreement do not restart the running of the twenty-one
(21) day consideration period.
(b) You understand that you may revoke this Agreement for a period of seven
(7) calendar days following your execution of the Agreement. You understand that
any revocation, in order to be effective, must be: (1) in writing and either
postmarked within seven (7) days of your execution of the Agreement and
addressed to General Counsel, TriMas Corporation, 00000 Xxxxxxxx, Xxxxx 000,
Xxxxxxxxxx Xxxxx, XX 00000, or (2) hand-delivered within seven (7) days of your
execution of the Agreement to TriMas' General Counsel at the address listed
above. If revocation is by mail, certified mail, return receipt requested is
required to show proof of mailing.
(c) No payments or benefits under this Agreement shall be made to you until
after the seven (7) day revocation period has expired. If you do not revoke this
Agreement within the seven (7) day revocation period, then this Agreement shall
become fully and finally effective and the payments and benefits provided
hereunder will be made to you in accordance with this Agreement.
10. Complete Agreement. In executing this Agreement, you are doing so knowingly
and voluntarily and agree that you have not relied upon any oral statements by
TriMas or its representatives, and that this Agreement, when signed by both
parties, supersedes any and all prior written agreements between the parties
regarding the terms of your employment or the termination of such employment,
including, without limitation, the Employment Agreement. You agree that the
provisions of Sections 2, 5, 6 and 7 have been separately negotiated and shall
survive any termination or expiration of this Agreement.
11. Severability. Should any provision of this Agreement be declared or
determined by any court to be illegal or invalid, the remaining parts, terms or
provisions shall not be affected thereby, and said illegal or invalid part, term
or provision shall be deemed not to be a part of this Agreement; provided that
such court may, in lieu of finding any provision hereof to be unenforceable,
illegal or invalid, modify any such provision to preserve to the greatest extent
possible the intended effect of such provision while otherwise rendering it
legal and enforceable.
Xx. Xxxx X. Xxxxxx
September 2, 2003
Page 7
12. Choice of Law. This Agreement shall be deemed to be made and entered into in
the State of Michigan and shall in all respects be interpreted, enforced and
governed under the laws of the State of Michigan and the United States.
13. Attorney. You understand and acknowledge that you have had the opportunity
to review this Agreement with an attorney, and have been encouraged and given
ample time to consult with your own legal counsel prior to executing this
Agreement to ascertain whether you have any potential rights or remedies that
are being waived and released by your execution of this Agreement. You
acknowledge that the decision to do so or not do so is totally your choice.
YOU REPRESENT THAT YOU FULLY UNDERSTAND THE TERMS OF THIS AGREEMENT AND EXECUTE
IT KNOWINGLY AND VOLUNTARILY; THAT NO PROMISE, INDUCEMENT OR AGREEMENT HAS BEEN
MADE TO YOU OTHER THAN THOSE SPECIFICALLY SET FORTH IN THIS AGREEMENT; THAT THIS
AGREEMENT, CONTAINS THE ENTIRE AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
MODIFIED EXCEPT BY A SUBSEQUENT WRITTEN AGREEMENT, EXECUTED BY BOTH PARTIES,
WHICH SPECIFICALLY EVIDENCES AN INTENT TO MODIFY THIS AGREEMENT; AND THAT YOU
HAVE BEEN ADVISED TO CONSULT WITH LEGAL COUNSEL PRIOR TO EXECUTING THIS
AGREEMENT.
WITNESSED:
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XXXX X. XXXXXX
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DATE OF WITNESS' SIGNATURE DATE OF EXECUTIVE'S SIGNATURE
TRIMAS CORPORATION
(TRIMAS)
BY:
-------------------------------------
ITS:
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Xx. Xxxx X. Xxxxxx
September 2, 2003
Page 8
ATTACHMENT A
By my signature below, I, Xxxx X. Xxxxxx (hereinafter "Executive"), accept the
following covenants, in exchange for consideration provided under the September
2, 2003 letter agreement ("letter agreement") with TriMas Corporation
("Company"), which agreement incorporates these covenants.
(a) Executive acknowledges and recognizes the highly competitive nature of the
business of Company and accordingly agrees that for the twenty-four (24)
month period following the Termination Date, as defined in the letter
agreement ("Non-Compete Term"), Executive shall not engage, either directly
or indirectly, as a principal for Executive's own account or jointly with
others, or as a stockholder in any corporation or joint stock association,
or as a partner or member of a general or limited liability entity, or as
an employee, officer, director, agent, consultant or in any other advisory
capacity in any business which designs, develops, manufacturers,
distributes, sells or markets the type of products or services sold,
distributed or provided by Company or its subsidiaries during the two (2)
year period prior to the Termination Date (the "Business"); provided that
nothing herein shall prevent Executive -------- from owning, directly or
indirectly, not more than five percent (5%) of the outstanding shares of,
or any other equity interest in, any entity engaged in the Business and
listed or traded on a national securities exchanges or in an
over-the-counter securities market.
(b) During the Non-Compete Term, Executive shall not (i) directly or indirectly
employ or solicit, or receive or accept the performance of services by, any
active employee of Company or any of its subsidiaries who is employed
primarily in connection with the Business, except in connection with
general, non-targeted recruitment efforts such as advertisements and job
listings, or directly or indirectly induce any employee of Company to leave
Company, or assist in any of the foregoing, or (ii) solicit for business
(relating to the Business) any person who is a customer or former customer
of Company or any of its subsidiaries, unless such person shall have ceased
to have been such a customer for a period of at least six (6) months.
(c) Executive shall not at any time disclose or use for Executive's own benefit
or purposes or the benefit or purposes of any other person, firm,
partnership, joint venture, association, corporation or other business
organization, entity or enterprise other than Company and any of its
subsidiaries, any trade secrets, information, data, or other confidential
information of the Company, including but not limited to, information
Xx. Xxxx X. Xxxxxx
September 2, 2003
Page 9
relating to customers, development programs, costs, marketing, trading,
investment, sales activities, promotion, credit and financial data,
financing methods, plans or the business and affairs of Company generally,
or of any subsidiary of Company, unless required to do so by applicable law
or court order, subpoena or decree or otherwise required by law, with
reasonable evidence of such determination promptly provided to Company. The
preceding sentence of this paragraph (d) shall not apply to information
which is not unique to Company or which is generally known to the industry
or the public other than as a result of Executive's breach of this
covenant. Executive further agrees that Executive will not retain or use
for Executive's account at any time any trade names, trademark or other
proprietary business designation used or owned in connection with the
business of Company or its subsidiaries.
(d) It is expressly understood and agreed that although Executive and Company
consider the restrictions contained in this Attachment A to be reasonable,
if a final judicial determination is made by a court of competent
jurisdiction that the time or territory or any other restriction contained
in this Agreement is an unenforceable restriction against Executive, the
provisions of this Attachment A shall not be rendered void but shall be
deemed amended to apply as to such maximum time and territory and to such
maximum extent as such court may judicially determine or indicate to be
enforceable. Alternatively, if any tribunal of competent jurisdiction finds
that any restriction contained in this Agreement is unenforceable, and such
restriction cannot be amended so as to make it enforceable, such finding
shall not affect the enforceability of any of the other restrictions
contained herein.
(e) Executive acknowledges and agrees that Company's remedies at law for a
breach or threatened breach of any of the provisions of this Attachment A
would be inadequate and, in recognition of this fact, Executive agrees
that, in the event of such a breach or threatened breach, in addition to
any remedies at law, Executive shall forfeit all payments otherwise due
under the letter agreement and shall return any payments made under the
letter agreement. Moreover, Company, without posting any bond, shall be
entitled to seek equitable relief in the form of specific performance,
temporary restraining order, temporary or permanent injunction or any other
equitable remedy which may then be available.
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Xxxx X. Xxxxxx
