RETIREMENT AND SEPARATION AGREEMENT
This Retirement and Separation Agreement ("Agreement") is entered into as of
November 1, 2002 between Xxxx Xxxx, ("Xxxx") and Avnet, Inc. ("Avnet" or "the
Company").
WHEREAS, Xxxx is employed by Avnet as its Controller;
WHEREAS, Xxxx desires to retire from his position with Avnet and Avnet wishes to
provide for continued services from Xxxx for a period following his retirement
from his position as Controller; and
WHEREAS, Xxxx and Avnet desire to resolve any differences arising out of his
employment with the Company and the termination of such employment by his
retirement;
NOW, THEREFORE, in consideration of the mutual promises contained in this
Agreement, Xxxx and the Company agree to the following:
1. Xxxx'x employment with the Company shall terminate effective August 31,
2006 (the "Effective Date"). Xxxx'x employment status until August 31,
2006 will be that of a regular full-time employee with eligibility for
normal company benefits except as specified below. On August 31, 2006,
Xxxx'x employment will terminate and will be coded in the company's
records as a retirement.
2. Xxxx will receive the following consideration:
a. Between the date on which this Agreement is fully executed and
August 31, 2003, Xxxx will continue to work on a full-time regular
basis and will assist with training his replacement as Controller of
Avnet, Inc. On September 1, 2003, Xxxx will resign his position as
Controller of Avnet, Inc. From September 1, 2003 through August 31,
2006, Xxxx will not be assigned regular duties and will not be
required to report to work. Xxxx'x status will be "on-call" status
and the Company may contact Xxxx on a periodic basis to answer
questions and provide necessary assistance.
x. Xxxx will be paid through August 31, 2003 at his current base rate
of pay of $166,000 per year and will receive payment for all accrued
vacation and unused floating holidays as a lump sum. No vacation or
floating holidays shall accrue after August 31, 2003.
c. Effective September 1, 2003 through August 31, 2006, Xxxx'x salary
will be reduced to an annual rate of $69,167 per year, to be paid on
a bi-weekly basis. The length of salary continuation and term of
employment may be shortened by at Xxxx'x option, but the total
payment commitment of $207,500 for the period from September 1, 2003
through August 31, 2006 will not be changed.
x. Xxxx will continue to be eligible for participation in Avnet benefit
programs in effect for Avnet's U.S. based employees and the Company
will continue to deduct the normal medical and dental employee
contributions based on the cost sharing arrangement in place from
time to time through August 31, 2006. Thereafter, Xxxx will become
eligible for normal COBRA medical/dental coverage continuation and
Avnet will reimburse Xxxx for the entire cost of Xxxx'x
medical/dental premium until August 31, 2007.
1
x. Xxxx will be allowed to continue using the company-leased vehicle
assigned to Xxxx until the lease termination on August 18, 2004 and
Xxxx will be reimbursed for normal gas and maintenance expenses upon
submission of a properly documented and approved expense report
submission to Xxxx Xxxxxx, Avnet's Vice President and Deputy General
Counsel. Thereafter, the Company will either extend the term of the
car lease to the Effective Date or, in lieu of a leased automobile,
pay Xxxx a car allowance of $1,200 per month through the Effective
Date.
f. The balance of all authorized but unissued shares of restricted
stock will be awarded to Xxxx annually until all shares have been
issued.
x. Xxxx will be allowed to participate in the company's executive
health improvement program (EHIP) in 2002, 2004 and 2006 and Avnet
will gift Xxxx the desktop computer currently in his home office.
x. Xxxx is currently vested in the Executive Officers' Supplemental
Life Insurance and Retirement Benefits Plan and you will receive
credit for 100% of a normal benefit based on employment through
August 31, 2006 at the average of the highest two years compensation
rate of $166,000 per year. This is a non-forfeitable benefit; and in
the event you pass away after your employment terminates and before
the benefit commences, it will be paid to your surviving spouse
and/or estate.
i. All existing stock options continue to vest during your employment
and can be exercised at any time up until 90 days after your
retirement (by November 30, 2006), with the exception of your
September 27, 2001 stock option grant (1999 stock option plan) which
continues to vest and will remain exercisable for up to five years
after retirement, but in any event, not longer than 10 years after
the grant date. Xxxx will be required to sign a two-year non-compete
agreement to preserve this entitlement.
x. Xxxx currently has a $15,000 salary advance outstanding. This
advance will be forgiven in exchange for vacation time accrued while
employed in Great Neck, NY with Avnet. The forgiveness of this
advance will be treated as imputed income and will appear on Xxxx'x
2002 W-2 statement.
x. Xxxx will be allowed an allowance of up to $1,500 with which to do
financial planning in preparation for retirement. This expense will
be reimbursed upon approval by Xxxx'x current supervisor, Xxxxxxx
Xxxxxxxx.
l. If Xxxx should die prior to all payments having been made, the
balance of unpaid payments will be payable to his estate.
3. Xxxx acknowledges that the consideration described in paragraph 2 is more
than the Company is required to pay under its customary policies and
procedures. In addition, Xxxx understands that after the Effective Date,
he will not accrue any further benefits under any of the Company's
applicable plans.
4. Xxxx understands and agrees that the payments and benefits described in
this Agreement are all Xxxx is entitled to receive from the Company with
respect to his employment and/or his separation from employment with the
Company, except for his vested rights in the Avnet Pension, 401(k), and
Executive Officers' Supplemental Life Insurance and Retirement Benefits
Plans (collectively, the "Plans").
2
5. Xxxx agrees, except for his vested rights in the Plans, to release,
discharge, indemnify and hold harmless the Company and its officers,
directors, employees, stockholders, agents, parent companies,
subsidiaries, affiliates, successors and assigns from any and all actions,
causes of action, contracts, claims, demands and liabilities whatsoever,
whether known or unknown, in connection with his employment with the
Company, and the termination of that employment, which Xxxx had, now has,
or may hereafter have by reason of any act, omission, occurrence, practice
or other matter through and including the date of this Agreement,
including, without limitation, any claim for unpaid wages, back pay,
commissions, vacation pay, severance or other compensation. This includes
a release of any rights or claims pursuant to any federal, state or local
laws, executive orders or regulations, including, without limitation, the
Age Discrimination in Employment Act, the Older Workers Benefit Protection
Act, Title VII of the Civil Rights Act of 1964, the Equal Pay Act, the
Fair Labor Standards Act, the American with Disabilities Act, the
Rehabilitation Act of 1973, the Family and Medical Leave Act, and claims
for wrongful discharge or any common law claims.
6. This Agreement shall not be construed as an admission of liability by the
Company and shall not be construed as an admission that Xxxx has any
rights whatsoever against the Company, except as set forth in this
Agreement.
7. Xxxx acknowledges that he has been given a period of forty-five (45) days
to review and consider this Agreement before signing it. Xxxx understands
that he may use as much of this forty-five (45) day period as he wishes
prior to signing.
8. Xxxx acknowledges and understands that he has had the right and
opportunity to discuss all aspects of this Agreement with his private
attorney and that he has been strongly encouraged to do so before signing
this Agreement. Xxxx represents that he has carefully read and fully
understands all of the provisions of this Agreement, and that he is
voluntarily entering into this Agreement.
9. Xxxx may revoke this Agreement within seven (7) days of signing it.
Revocation can be made by delivering a written notice of revocation to:
Xxxx Xxxxxx
Vice President and Deputy General Counsel
Avnet, Inc.
0000 X. 00xx Xx.
Xxxxxxx, XX 00000
For this revocation to be effective, written notice must be received by
Xxxx Xxxxxx no later than the close of business on the seventh day after
Xxxx signs this Agreement. If Xxxx revokes this Agreement, it will not
become effective or enforceable and Xxxx will not receive the benefits
described in paragraph 2 above.
10. It is expressly understood that there is no other agreement or
understanding between Xxxx and the Company, except the Confidentiality and
Development Agreement, pertaining to the termination of Xxxx'x employment
with the Company or the Company's obligations to Xxxx with respect to such
termination, except as set forth in this Agreement.
3
11. Any controversy or claim arising out of or relating to Xxxx'x employment
with the Company, the termination of such employment, this Agreement, or
the breach thereof, shall be settled by arbitration in accordance with the
commercial rules of the American Arbitration Association before a panel of
three arbitrators in or near the city where Xxxx resides. Xxxx and the
Company agree that any judgment upon any award rendered by the arbitrators
may be entered in any court having jurisdiction thereof.
12. If any provision of this Agreement shall be held to be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
PLEASE READ CAREFULLY. Carefully consider all provisions of this Agreement
before signing it. THIS AGREEMENT INCLUDES A RELEASE OF ALL KNOWN AND UNKNOWN
CLAIMS.
/s/ Xxxx Xxxx
-----------------------------------------------
Xxxx Xxxx
AVNET, INC.
By /s/ Xxxxxxx Xxxxxxxx
-------------------------------------------
Xxxxxxx Xxxxxxxx
Senior Vice President & Chief Financial Officer
4
