EXHIBIT 10.1
RESIGNATION AGREEMENT AND GENERAL RELEASE
This Resignation Agreement and General Release ("Agreement") is entered
into by and between Apogee Enterprises, Inc., a Minnesota corporation (the
"Company") and Xxxxx X. Xxxxxxxxx (the "Executive") as of the later of the dates
set forth on the signature page hereof. In consideration of the mutual
covenants, promises and agreements contained in this Agreement, the Company and
the Executive agree as follows:
1. Resignation. The Executive hereby resigns his employment as Executive
Vice President of the Company, effective July 1, 1998. The Executive will
continue to serve as a member of the Company's Board of Directors and will be
eligible for reelection to the Board.
2. Consulting Services. The Company hereby retains the Executive to
provide consulting services to the Company and its subsidiaries from time to
time as requested during the period from July 1, 1998, through July 1, 2001. The
Company will pay to the Executive a fee of $250,000 per year in consideration of
such services. Such fee will be paid in equal monthly installments of $20,833.33
during the three-year term, at the beginning of each calendar month. A prorated
portion of such fee shall be payable upon the termination of this Agreement, if
such termination occurs other than at the end of a month. The Company will
reimburse the Executive for all necessary and reasonable expenses incurred in
connection with the performance of consulting services hereunder, provided the
Executive promptly submits documentation of such expenses acceptable to the
Company.
If the Executive should die or become incompetent due to disability prior
to July 1, 2001, the Company will: (a) continue to make the payments provided in
this Section to the Executive's estate or legal representative through the end
of the calendar year in which the Executive's death or disability occurs; and
(b) pay to the Executive's estate or legal representative, between January 1 and
January 15 of the calendar year following the year of the Executive's death or
disability, a lump sum payment equal to the total amount of the remaining
payments payable after the end of the calendar year in which the Executive's
death or disability occurs, discounted at the U.S. Bank National Association
Reference Rate in effect on January 1 of the year of payment; provided, however,
that if the Executive's estate or legal representative elects to continue
receiving the payments provided in this Section on the schedule provided in this
Section, the remaining payments payable after the end of the calendar year in
which the Executive's death or disability occurs will be paid according to such
schedule. Such election must be made within ninety (90) days of the Executive's
death or disability, but in no event prior to the end of the calendar year in
which the Executive's death or disability occurs, and must be made in writing by
delivery of notice to the Company.
The parties agree that the Executive will provide the services referenced
in this Section as an independent contractor of the Company, and under no
circumstances shall the Executive be considered an employee of the Company.
The Company shall have the right to terminate the Executive's consulting
services without further obligation to the Executive under this Section 2 for
Cause. "Cause" shall mean: (a) any fraud, misappropriation, theft, embezzlement,
or other illegal or dishonest act by the Executive; (b) any conviction of or
nolo contendere plea to a felony or gross misdemeanor by the Executive; (c)
intentional or reckless misconduct by the Executive in the performance of his
consulting services; (d) material failure by the Executive to provide his
consulting services to the Company; or (e) any material breach by the Executive
of his obligations under this Agreement.
3. Medical and Dental Insurance. The Company will continue to pay the
Executive's group medical and dental insurance premiums for coverage for the
Executive and his family for a period of 18 months following July 1, 1998,
provided the Executive elects to continue such coverage pursuant to COBRA.
Thereafter, and until the Executive reaches the age of 65, the Company will
reimburse the Executive for the cost of medical insurance for the Executive and
his spouse which is reasonably equivalent to the medical insurance covering the
Executive and his spouse at the time of his resignation.
4. Stock Options. The exercisability of all stock options granted to the
Executive under the Incentive Stock Option Agreements dated June 20, 1995, and
April 18, 1997 (collectively, the "ISO Agreements"), and the Non-Statutory Stock
Option Agreements dated June 18, 1996, and April 18, 1997 (collectively, with
the ISO Agreements, the "Option Agreements"), is hereby accelerated so that all
such options not otherwise exercisable as of July 1, 1998, will become
exercisable on or after July 1, 1998. All other terms of the Option Agreements
will remain in effect, except that, to the extent the options granted under the
ISO Agreements no longer qualify as incentive stock options under Section 422A
of the Internal Revenue Code of 1986, as amended, as a result of such
acceleration of exercisability, such options shall automatically be deemed to be
converted into and become non-statutory options.
The Company will pay to the Executive the total sum of $227,200 to
compensate him for the reduction in value of the options under the ISO
Agreements and the Non-Statutory Stock Option Agreement dated April 18, 1997,
which reduction is due to the Executive's resignation. This sum shall be paid as
follows: (a) two installments of $75,730 each will be paid to the Executive on
June 1, 1999, and June 1, 2000, respectively; and (b) a third installment of
$75,740 will be paid to the Executive on July 1, 2001. All payments provided in
this paragraph will be subject to required tax withholding.
5. Release. In exchange for the Company's commitments specified in this
Agreement, the Executive fully releases and discharges the following entities
and persons from all legal claims, whether known or unknown: the Company, its
subsidiaries, its related and/or affiliated companies, and all of the respective
officers, shareholders, directors, employees, agents, and insurers of the
Company, its subsidiaries, and its related and/or affiliated companies.
The Executive acknowledges that by releasing all of his legal claims
against these entities and persons, he is releasing all of his rights to bring
any claims against them based on any actions, decisions, or events occurring
through the date of the Executive's signing of this Agreement, including the
terms and conditions of the Executive's employment and the Executive's
resignation of his employment. The Executive's release includes any claims based
upon:
o Federal, state or local employment discrimination laws,
regulations or requirements, including the Minnesota Human Rights Act,
Minn. Stat. Ch. 363; Minn. Stat. ss.181.81; Title VII of the Civil
Rights Act, 42 U.S.C. ss.ss.2000e, et seq.; the Age Discrimination in
Employment Act, 29 U.S.C. ss.ss.621, et seq.; and the Americans with
Disabilities Act, 42 U.S.C. ss.ss.12101, et seq.;
o Any other statute, ordinance, or regulation;
o Any contract, quasi-contract or promissory estoppel;
o Any tort, including wrongful discharge, misrepresentation,
fraud, infliction of emotional distress, or defamation; or
o Any other theory, whether developed or undeveloped.
The foregoing release of Executive does not apply to his executory rights
under this Agreement, the option agreements referenced in Section 4 of this
Agreement, or the Company's Partnership Plan (Pool A and Pool B), Deferred
Compensation Plan, TRIP and ARP, or any other Company plan with benefits in
which the Executive is vested as of the date hereof.
6. Non-Disclosure of Confidential Information. The Executive agrees
that any Confidential Information received by him as a result of his employment
with the Company, or as a result of his continuing consulting services to the
Company under this Agreement, shall be the property of the Company and shall be
held in trust by him and solely for the Company's benefit. Except as required in
the course of his duties to the Company, the Executive agrees that he will not,
either during the term of this Agreement
or at any time thereafter, use or divulge or make accessible to any other person
any Confidential Information. "Confidential Information" shall mean information
of or about the Company, its products, services or customers which is not
generally known to others, including trade secret information about the
Company's methods or processes or products, and information relating to
research, development, manufacture, purchasing, accounting, marketing,
merchandising, selling, servicing, customers, finance or business systems and
techniques. All information disclosed to the Executive or to which he obtained
access during the period of his employment or during the term of this Agreement,
which he has a reasonable basis to believe to be Confidential Information, shall
be presumed to be Confidential Information. As used in this Section 6, the term
"Company" shall be deemed to mean and include the Company, its subsidiaries
(past and present) and its related and affiliated companies (past and present).
The foregoing obligations of confidentiality shall not apply to any
knowledge or information that is now published or that subsequently becomes
generally publicly known in the form in which it was obtained from the Company,
other than as a direct or indirect result of the breach of this Agreement by the
Executive.
7. Covenant Not to Compete or Solicit.
(a) Agreement Not to Compete. The Executive agrees that, during the
term of the Executive's consulting services hereunder, he will not, directly or
indirectly: (i) engage in competition with the Company or with any of the
Company's subsidiaries or affiliates in any manner or capacity (e.g., as an
advisor, principal, agent, partner, officer, director, stockholder, employee,
member of any association, or otherwise) in any phase of the business of the
Company or any of its subsidiaries or affiliates; (ii) solicit from the
Company's customers or the customers of any of the Company's subsidiaries or
affiliates any business that the Company or any of its subsidiaries or
affiliates is capable of performing; or (iii) induce, either directly or
indirectly, any employee, agent, independent contractor, supplier, customer or
any other person or organization to terminate or alter its relationship with the
Company or with any of the Company's subsidiaries or affiliates.
(b) Geographic Extent of Covenant. The obligations of the Executive
under this Section 7 shall apply to any place in the United States in which the
Company or any of its subsidiaries or affiliates: (i) has engaged in business
within the three years prior to the Executive's resignation of his employment
with the Company, or during the term of this Agreement, through production,
promotional, servicing, sales, merchandising or marketing activity, or
otherwise; or (ii) has otherwise established its goodwill, business reputation,
or any customer or supplier relations.
(c) Limitation on Covenant. Ownership by the Executive, as a passive
investment, of less than five percent (5%) of the outstanding shares of capital
stock of any
corporation listed on a national securities exchange or publicly traded in the
over-the-counter market shall not constitute a breach of this Section 7.
(d) Indirect Competition. The Executive agrees that, during the term of
this Agreement, he will not, directly or indirectly, assist or encourage any
other person in carrying out, directly or indirectly, any activity that would be
prohibited by the above provisions of this Section 7, if such activity were
carried out by the Executive, either directly or indirectly; and in particular,
the Executive agrees that he will not, directly or indirectly, induce any
employee of the Company to carry out, directly or indirectly, any such activity.
(e) Company Remedies. The Executive acknowledges that the remedy at law
for any breach of the foregoing covenants of this Section 7 will be inadequate,
and that the Company shall be entitled, in addition to any remedy at law, to
preliminary and permanent injunctive relief.
8. Acceptance Period. The terms of this Agreement will be open for
acceptance by the Executive for a period of 21 days, during which time the
Executive may consider whether or not to accept this Agreement and seek counsel
to advise him regarding this Agreement. The Executive agrees that changes to
this Agreement, whether material or immaterial, will not restart this acceptance
period.
9. Right to Revoke. The Executive has the right to revoke this
Agreement by written notice to the Company within fifteen (15) calendar days
following his signing of it. Such revocation must be in writing and
hand-delivered to the Company or, if sent by mail, postmarked within the
applicable time period and sent by certified mail, return receipt requested.
Such revocation must be delivered or sent to the following address: Xxxxxx X.
Xxxxxxx, Apogee Enterprises, Inc., 0000 Xxxxxx Xxxxxx Xxxxx, Xxxxx 0000,
Xxxxxxxxxxx, XX 00000-0000.
If the Executive exercises his right to revoke this Agreement, it will be
nullified in its entirety, and the neither party will have any rights or
obligations hereunder.
10. Confidentiality. The Executive agrees to keep the terms of this
Agreement strictly confidential. The Executive agrees not to disclose any
information concerning this Agreement to any person, including any present or
former employee of the Company. These confidentiality provisions are subject to
the following exceptions: the Executive may disclose this Agreement to his
present or future attorneys, financial advisors, or tax advisors; in the course
of legal proceedings involving the Company; or in response to a court order,
subpoena or inquiry by a government agency.
11. No Assignment. This Agreement is personal to the Executive and may
not be assigned by him.
12. Governing Law; Severability. This Agreement shall be governed by
the laws of the State of Minnesota. To the extent any provision of this
Agreement shall be determined to be invalid or unenforceable in any
jurisdiction, such provision shall be deemed to be deleted from this Agreement
as to such jurisdiction only, and the validity and enforceability of the
remainder of such provision and of this Agreement shall be unaffected. In
furtherance of and not in limitation of the foregoing, the Executive expressly
agrees that should the duration of or geographical extent of, or business
activities covered by, any provision of this Agreement be in excess of that
which is valid or enforceable under applicable law in a given jurisdiction, then
such provision, as to such jurisdiction only, shall be construed to cover only
that duration, extent or activities that may validly or enforceably be covered.
The Executive acknowledges the uncertainty of the law in this respect and
expressly stipulates that this Agreement shall be construed in a manner that
renders its provisions valid and enforceable to the maximum extent (not
exceeding its express terms) possible under applicable law in each applicable
jurisdiction.
13. Venue. Any action at law, suit in equity, or judicial proceeding
arising directly, indirectly, or otherwise in connection with, out of, related
to or from this Agreement or any provision hereof, shall be litigated only in
the courts of the State of Minnesota, County of Hennepin, and the Executive
waives any right the Executive may have to transfer or change the venue of any
litigation brought against the Executive by the Company.
14. Entire Agreement. This Agreement contains the entire agreement
between the Executive and the Company with respect to the matters addressed
herein, and there are no promises or understandings outside of this Agreement
with respect to such matters. Any modification of or addition to this Agreement
must be in a writing signed by the Executive and the Company.
15. Acknowledgment. The Executive affirms that he has read this
Agreement. The Executive is hereby advised to consult with an attorney prior to
signing this Agreement. The Executive agrees that the provisions of this
Agreement are understandable to him and that he has entered into this Agreement
freely and voluntarily.
Dated: September 17, 1998 By /s/ Xxxxx X. Xxxxxxxxx
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Xxxxx X. Xxxxxxxxx
Dated: September 28, 0000 XXXXXX XXXXXXXXXXX, INC.
By Xxxxxx X. Xxxxxxx
Its Chairman
