Exhibit 10.28
As Executed
SEVERANCE AGREEMENT BY AND BETWEEN WPL HOLDINGS, INC. AND XXXXXXX X. XXXXX
April 20, 1998
Xx. Xxxxxxx X. Xxxxx
0000 Xxxxxxxxxx Xxx
Xxxxxxx, XX 00000
Dear Nino:
This letter agreement confirms our mutual understanding regarding the
benefits you will be entitled to receive under the Key Executive
Employment and Severance Agreement between you and WPL Holdings, Inc. (the
"Company"), dated as of June 25, 1994 (the "KEESA"), following
consummation of the transactions (the "Merger") contemplated by that
certain Agreement and Plan of Merger, dated as of November 10, 1995, as
amended, by and between the Company, IES Industries Inc., Interstate Power
Company, and certain other parties, and the termination of your employment
with the Company and its affiliates. The terms of our understanding are
set forth below:
1. Termination of Employment. Your employment as an officer and/or
employee of the Company and its affiliates (including, without limitation,
Wisconsin Power & Light Company) will be terminated effective as of the
day following the date on which the Merger is consummated (your
"Termination Date"). You agree that as of your Termination Date, your
signature below accepting this letter agreement will also constitute your
resignation from each of the other positions listed on Schedule A attached
to and made a part of this letter. Assuming that the Merger is
consummated, the Company and you agree that the termination of your
employment shall be treated as a Covered Termination by the Company
entitling you to the payment of Accrued Benefits and the Termination
Benefit as provided in Sections 8 and 9 of the KEESA and as specified in
Section 2 hereof, without the necessity to comply with the procedures set
forth in Section 13 of the KEESA. You agree that your Termination Date
under this letter agreement will also constitute your "Termination Date"
for purposes of the KEESA.
2. Scope of Benefits.
(a) You agree that during 1998 the total value of benefits that
may be paid to you under the KEESA (as reduced by the provisions of
Section 9(b) thereof) is $614,771. This amount is one dollar less than
the product obtained by multiplying (i) the average of the compensation
paid to you by the Company and its affiliates (as reflected in Box 1 of
your Form W-2s) for the five calendar years ended December 31, 1997, by
(ii) three (3).
(b) Following consummation of the Merger and your termination,
the benefits under your KEESA will be paid as follows:
(i) $593,771 in cash or cash equivalent within ten (10)
business days after your Termination Date; and
(ii) $21,000 (the "Benefits Amount") will be credited to a
bookkeeping account to be maintained by the Company to provide you,
for a period of up to five (5) years commencing on your Termination
Date, with (a) medical coverage as a single adult under The Medical
Plus Plan sponsored by Wisconsin Power and Light Company, (b) dental
coverage as a single adult under The Dental Plus Plan sponsored by
Wisconsin Power and Light Company, (c) Basic Term Life Insurance in
the amount of $254,000 and Supplemental Group Term Life Insurance in
the amount of $169,000 under the life insurance programs sponsored by
Wisconsin Power and Light Company. The Benefits Amount reflects the
estimated cost of providing the above-described benefits to you for a
five-year period. The outstanding balance of the Benefits Amount
(i.e., the Benefits Amount net of funds expended to provide you
benefits hereunder) shall bear interest at the mid-term Applicable
Federal Rate as specified for the month in which the Merger is
consummated, compounded annually. Interest credited as set forth
above will be added to the Benefits Amount. You agree that, in the
event the costs incurred by the Company or its affiliates in
providing the above-described benefits (or family or employee plus
one medical or dental benefits to which you will have access on your
request to the Company in writing on the same terms and conditions as
apply to active employees at any time during the five-year period) to
you exceeds the Benefits Amount, you will reimburse the Company for
the excess amount. Conversely, in the event that the cost of such
benefits for the five-year period is less than the Benefits Amount or
in the event you elect in a writing delivered to the Company not to
receive such benefits for the entire five-year period, you will be
entitled to a refund from the Company equal to the difference between
the Benefits Amount and the actual costs incurred by the Company and
its affiliates in providing the benefits you did receive. Any
payments due under the preceding two sentences to the Company or to
you, as the case may be, shall be paid in cash or cash equivalent
within thirty (30) days of written notice thereof. Your failure to
provide such payment to the Company, if you are so obligated, on a
timely basis will result in a loss of benefits hereunder. You agree
that the benefits offered to you hereunder shall be governed by the
specific terms of the plans pursuant to which they are provided. You
further agree that, pursuant to Section 8(b)(ii) of the KEESA, if you
obtain new employment and are covered by benefits which are in the
aggregate at least equal in value to the benefits described above,
you will provide prompt written notice to the Company of your intent
to terminate your benefits coverage as provided herein.
3. Payment of Legal Fees. Upon payment of the amount specified in
Section 2(b)(i) hereof and upon presentation by you or your legal counsel
to the Company of a copy of any bills you have received from your legal
counsel in connection with the payment of any amount under the KEESA, the
Company will also either pay directly or reimburse to you up to $10,000
against such legal fees and related expenses.
4. No Other Benefits. Except as contemplated by Sections 2 and 3
hereof and except for the payment of Accrued Benefits, which include your
vested stock options, you waive the right to any other payments or
benefits that you might otherwise be entitled to under the KEESA and
further agree that receipt of the payment specified in Section 2(b)(i)
hereof shall constitute your release of any rights you might have to any
other severance payments under any severance policy, practice or agreement
of the Company or any of its affiliates. You also agree that, other than
under the KEESA, you have no other payments or benefits that automatically
accelerate, vest or become payable as a result of the consummation of the
Merger.
5. No Amendment of KEESA. Except for specifying your Termination
Date under the KEESA, dispensing with the necessity to comply with the
procedures set forth in Section 13 of the KEESA and modifying the
provisions of Section 9(b)(ii) of the KEESA regarding the procedure for
calculating the Total Payments (as defined in the KEESA) to be made to you
thereunder, this letter agreement is not intended to modify the KEESA in
any respect, and the KEESA shall remain in full force and effect.
6. Release.
(a) Except as expressly provided herein, in consideration of
the payments provided by the Company hereunder and other good and valuable
consideration the receipt and sufficiency of which is hereby acknowledged,
you, on behalf of yourself, your spouse, heirs, executors, administrators,
agents, successors, assigns and representatives of any kind (hereinafter
collectively referred to as the "Releasors") confirm that Releasors have
released the Company, and each of its subsidiaries (including, without
limitation, Wisconsin Power and Light Company), affiliates, their
employees, successors, assigns, executors, trustees, directors, advisors,
agents and representatives, and all their respective predecessors and
successors (hereinafter collectively referred to as the "Releasees"), from
any and all actions, causes of action, charges, debts, liabilities,
accounts, demands, damages and claims of any kind whatsoever including,
but not limited to, those arising out of the changes in the terms and
conditions of your relationship with the Company described in this letter
agreement and those arising under any labor, employment discrimination
(including, without limitation, the Age Discrimination in Employment Act
of 1967, as amended, Title VII of the Civil Rights Act of 1964, as
amended, the Wisconsin Fair Employment Act, as amended), contract or tort
laws, equity or public policy, or negligence standard, whether known or
unknown, certain or speculative, which against any of the Releasees, any
of the Releasors ever had, now has, or hereafter shall have or can have.
You further covenant that you will not initiate any action, claim or
proceeding against any of the Releasees for any of the foregoing, nor will
you participate, assist, or cooperate in any such action, claim, or
proceeding unless required to do so by law. Notwithstanding the
foregoing, this release does not cover any matter which arises after the
Termination Date.
(b) Except as expressly provided herein, the Company, on behalf
of its affiliates, agents, successors, assigns and representatives (the
"Company Releasors"), hereby release you from any and all causes of
action, liabilities, damages and claims of any kind whatsoever including,
but not limited to, those arising out of your employment relationship with
the Company prior to the Termination Date, whether known or unknown,
certain or speculative, which any of the Company Releasors ever had, now
has, or hereafter shall or can have; provided, however, that the foregoing
shall not release you from any causes of action, liabilities, damages or
claims relating to (i) a willful failure to deal fairly with the Company,
its shareowners, or any other Company Releasor in connection with a matter
in which you had a material conflict of interest, (ii) a violation of the
criminal law, unless you had reasonable cause to believe that your conduct
was lawful or reasonable cause to believe that your conduct was not
unlawful, (iii) a transaction from which you derived an improper personal
profit or (iv) willful misconduct. The Company Releasors further covenant
they will not initiate any action, claim or proceeding against you for any
of the foregoing claims for which you have been released from liability.
Notwithstanding the foregoing, this release does not cover any matter
which arises after the Termination Date.
(c) Notwithstanding the foregoing, this letter agreement does
not waive rights, if any, you or your successors and assigns may have
under or pursuant to, or release any member of Releasees from obligations,
if any, it may have to you or to your successors and assigns on claims
arising out of, related to or asserted under or pursuant to, this letter
agreement or any indemnity agreement or obligation contained in or adopted
or acquired pursuant to any provision of the charter or by-laws of the
Company or its subsidiaries or affiliates or in any applicable insurance
policy carried by the Company or its affiliates for any matter which
arises or may arise in the future in connection with your employment with
the Company.
(d) You hereby acknowledge that you have at least twenty-one
(21) days to review this letter agreement from the date you first receive
it and you have been advised to review it with an attorney of your choice.
You further understand that the twenty-one (21) day review period ends
when you sign this letter agreement. You also have seven (7) days after
your signing of this letter agreement to revoke by so notifying the
Company in writing and repaying any amount paid to you hereunder. You
further acknowledge that you have carefully read this letter agreement,
know and understand the contents thereof and its binding legal effect.
You sign the same of your own free will and act, and it is your intention
that you be legally bound thereby.
7. Timing of the Merger. In the event the Merger is not
consummated by May 10, 1998, this letter agreement shall terminate and be
of no further force and effect.
If you find that the foregoing satisfactorily states our mutual
understanding, please sign and date the enclosed copy of this letter
agreement in the spaces provided below and return it to me.
Sincerely yours,
WPL HOLDINGS, INC.
By: /s/ Xxxxxxx X. Xxxx
Xxxxxxx X. Xxxx
Agreed to and Accepted this 20th day of April 1, 1998.
By: /s/ X.X. Xxxxx
X. X. Xxxxx
SCHEDULE A
To Letter Agreement Between
Xxxxxxx X. Xxxxx and WPL Holdings, Inc.
Dated April 20, 1998
Per Section 1 of the above letter agreement, the positions from which
Xx. Xxxxx has resigned as of his Termination Date are as follows:
(Foundation - President)
(Land Trust - President)
(South Beloit Water, Gas and Electric Company - Vice President)
