1
Exhibit 10.29
TERMINATION, CONSULTING AND RELEASE AGREEMENT
TERMINATION, CONSULTING AND RELEASE AGREEMENT dated as of
February 12, 1997 (the "Agreement") among Harvard Industries, Inc. a Florida
corporation (the "Company"), Anchor Industries International, Inc., a Florida
corporation ("AII"), and Xxxxxxx X. Xxxxxxx (the "Executive").
WHEREAS, AII was previously retained by the Company to provide the
management services and expertise of the Executive to the Company and the
Executive was employed by the Company as its Chairman of the Board of Directors,
Chief Executive Officer and President, in each case, on the terms and conditions
set forth in the Amended and Restated Management and Option Agreement dated as
of August 16, 1996 between the Company and AII (the "Prior Agreement");
WHEREAS, the Company and AII wish to terminate the management
services relationship between the Company and AII and the Executive desires to
resign his employment and all of his positions with the Company and its direct
and indirect subsidiaries and affiliates effective as of the date hereof,
subject to the terms and conditions set forth below;
WHEREAS, the Company is prepared to make certain payments to AII and
to make certain benefits available to the Executive, each as described herein,
in consideration for the undertakings of AII and the Executive described herein;
NOW, THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the adequacy of which is hereby acknowledged, the
parties, intending to be legally bound, hereby agree as follows:
2
2
1. Termination of Prior Agreement. Each of the Company, AII and the
Executive hereby consents to the termination of the Prior Agreement, which
shall, effective as of the date hereof, be deemed terminated and of no further
force and without further obligation of any party thereunder; provided, however,
that it is expressly agreed and understood that each of (i) Section 6 of the
Prior Agreement (relating to AII's rights with respect to Option I and Option
II), (ii) Section 9 of the Prior Agreement (relating to the Company's covenants
with respect to share authorization, listing and registration rights), (iii)
Section 8 of the Prior Agreement (relating to certain representations and
warranties) and (iv) Section 10 of the Prior Agreement (relating to certain
Company indemnification undertakings) shall survive the termination of the Prior
Agreement.
2. Resignation; Full Satisfaction
(a) The Executive hereby resigns, effective as of the date
hereof, from the Executive's positions as Chairman of the Board, President and
Chief Executive Officer of the Company and from all other positions and
directorships that the Executive holds with the Company and its direct and
indirect subsidiaries and affiliates.
(b) AII hereby resigns, effective as of the date hereof, from
its appointment and employment by the Company pursuant to the Prior Agreement
and from all other positions that AII holds with the Company and its direct and
indirect subsidiaries and affiliates.
(c) Each of AII and the Executive acknowledges and agrees
that, except as expressly set forth in this Section 2 and in Sections 1, 3, 4
and 9 of this Agreement, neither AII nor the Executive will be entitled to any
other compensation
3
3
or benefits from the Company or its direct or indirect subsidiaries and
affiliates, including, without limitation, any other severance or termination
benefits (whether pursuant to the Prior Agreement, or otherwise); provided that
(i) it is agreed that nothing in this Agreement shall constitute a waiver of the
Executive's rights to vested benefits, if any, under any Company retirement or
group health plan in respect of his services to the Company prior to the date
hereof ("Vested Benefits") and (ii) notwithstanding the termination of the Prior
Agreement as of the date hereof, AII shall continue to receive the compensation
described in Section 3(a) of the Prior Agreement through and including March 1,
1997 (the "Consulting Commencement Date") and to be entitled to reimbursement of
business expenses incurred by AII through and including the Consulting
Commencement Date pursuant to the first sentence of Section 7 of the Prior
Agreement. Each of AII and the Executive hereby acknowledges that, as of the
date hereof, AII and the Executive have been paid all monies due to AII and the
Executive from the Company and its direct or indirect subsidiaries and
affiliates on account of wages, wage supplements, compensation, commissions,
bonuses, vacation, benefits and all other entitlements in respect of AII's and
the Executive's services prior to the date hereof.
3. Consulting Arrangement.
(a) Effective as of the Consulting Commencement Date, the
Company hereby retains AII to make the Executive's services available to the
Company, and the Executive hereby agrees to serve, as a consultant to the
Company during the three year period commencing as of the Consulting
Commencement Date and ending on the third anniversary of the Consulting
Commencement Date (the "Consulting Term"), subject to earlier termination of the
Consulting Term due to the
4
4
Executive's or AII's willful breach of the provisions of Sections 5, 7 or 8 of
this Agreement.
(b) During the Consulting Term, AII and the Executive shall
render such advice and services relating to the business and strategic business
plan of the Company as may be reasonably requested by the Company and shall
assist the Company, to the extent requested, in its efforts to recruit a new
Chief Executive Officer, it being understood that such services shall be
incidental to, and shall not materially interfere with, the Executive's other
professional activities and shall not, in any event, occupy more than twenty
(20) hours of the Executive's business time in any one month period. The Company
shall provide the Executive with reasonable advance notice prior to requiring
the Executive to perform any services hereunder. In carrying out his duties as
consultant, the Executive shall report to the Chief Executive Officer of the
Company. In addition, the Executive agrees to cooperate with the Company during
the Consulting Term and thereafter by making himself reasonably available to
testify on behalf of the Company or its direct or indirect subsidiaries and
affiliates in any action, suit or proceeding, whether civil, criminal,
administrative, or investigative, relating to events that occurred during AII
and the Executive's employment with the Company or during the Consulting Term,
and to assist the Company and its direct or indirect subsidiaries and affiliates
in any such action, suit or proceeding by providing information and meeting and
consulting with the Board of Directors of the Company or their representatives
or counsel or representatives or counsel to the Company or any of its direct or
indirect subsidiaries and affiliates, as reasonably requested by the Board of
Directors of the Company or such representatives or counsel.
5
5
(c) The Company shall reimburse the Executive for reasonable
and documented out-of-pocket expenses incurred in connection with the
performance of consulting services hereunder.
(d) From and after the date hereof, the Executive shall cease
to be an employee of the Company and its affiliates and shall not be entitled to
participate in any employee benefit plan or other benefits or conditions of
employment available to the employees of the Company or its affiliates; provided
that (i) (A) until the earliest to occur of (x) the third anniversary of the
Consulting Commencement Date, (y) the Executive's eligibility for coverage under
another group health or other medical plan in connection with his employment
(including self employment) by another employer (excluding for theses purposes
until the eighteen (18) month anniversary of the Consulting Commencement Date,
however, any coverage that the Executive may currently be eligible to receive),
and (z) the Executive's or AII's willful breach of any of the provisions of
Sections 5, 7, or 8 of this Agreement, (the "Continuation Period"), to the
extent permitted by the Company's group health and medical plans, the Executive
shall be entitled to receive continued coverage under the Company's group health
and medical plans as if the Executive were an active employee of the Company,
and (B) from and after the expiration of the Continuation Period, the Executive
shall be entitled to COBRA continuation coverage under the Company's group
health and medical plans to the extent provided by law; and (ii) if the
arrangements described in clause (i) above are not permitted by the Company's
group health and medical plans, (A) from and after the date hereof the Executive
shall be entitled to COBRA continuation coverage to the extent permitted by law
and (B) until the expiration of the Continuation Period, the Company shall be
responsible
6
6
for the excess of (I) the premium cost to the Executive of such COBRA
continuation coverage over (II) the premium cost from to time to active
executive employees of the Company with respect to similar coverage under the
Company's group health and medical plans and during the portion of the
Continuation Period, if any, after which COBRA continuation coverage is no
longer available to the Executive, the Company will reimburse the Executive for
the actual cost incurred by the Executive in obtaining alternative medical
coverage; provided that the reimbursement obligation of the Company shall not
exceed the Company's actual cost for providing coverage for an active executive
employee of the Company. In addition, the Company, AII and the Executive agree
to use their reasonable efforts to cause (i) an amendment to the Split Dollar
Life Insurance Agreement relating to that certain life insurance policy
currently maintained by the Company pursuant to Section 4(b) of the Prior
Agreement (the "Policy"), substantially in the form of Exhibit I hereto, to be
executed by the Company and the Trustee of the Xxxxxxx X. Xxxxxxx 1992 Insurance
Trust and (ii) an amendment to the Assignment Agreement relating to the Policy,
substantially in the form attached as Exhibit A to Exhibit I hereto, to be
executed by the Trustee of the Xxxxxxx X. Xxxxxxx 1992 Insurance Trust.
(e) The Executive shall have no authority to act as an agent
of the Company or its direct or indirect subsidiaries and affiliates, except on
authority specifically so delegated by the Chairman of the Board or the Board of
Directors of the Company, and he shall not represent himself to the contrary to
any person or entity, and the Executive shall not direct the work of any
employee of the Company or its direct or indirect subsidiaries and affiliates or
make any management decisions
7
7
or undertake to commit the Company or its direct or indirect subsidiaries and
affiliates to any action in relation to third parties.
4. Compensation.
(a) In consideration for the termination of the Prior
Agreement, the consulting services to be provided by AII and the Executive
herein and the covenants of AII and the Executive contained herein, the Company
agrees to pay AII the amount of $41,666.00 per month with respect to the first
twelve (12) months of the Consulting Term on the 15th day of each such month,
and the amount of $104,166.67 per month with respect to the remaining
twenty-four (24) months of the Consulting Term on the 15th day of each such
month (collectively, the "Compensation"). AII shall be entitled to the payment
of the Compensation regardless of the extent to which the Executive's consulting
services are requested hereunder; provided that the Company's obligation to make
any further payments of the Compensation hereunder shall immediately cease upon
the termination of the Consulting Term due to the Executive's or AII's willful
breach of any of the provisions set forth in Sections 5, 7 or 8 of this
Agreement.
(b) The Company agrees to continue to use the services of Nice
& Easy Travel on substantially the same terms and conditions that it has been
utilizing its services to date in the ordinary course of business for the one
year period commencing on the date hereof. Thereafter, the Company agrees that
it will continue to use the services of Nice & Easy Travel during the remainder
of the Consulting Term so long as the price and level of services provided by
Nice & Easy Travel is at least as favorable as that of other travel agency
services available to the Company. The Company's obligation under this Section
4(b) shall terminate immediately upon
8
8
the termination of the Consulting Term due to the Executive's or AII's willful
breach of the provisions of Sections 5, 7 or 8 of this Agreement.
(c) The Company agrees to continue to pay the monthly fees, up
to $2,100 per month, incurred by Executive with respect to the apartment located
in New York City that he is currently using until the first anniversary of the
date hereof. The Company's obligation under this Section 4(c) shall terminate
immediately upon the termination of the Consulting Term due to the Executive's
or AII's willful breach of the provisions of Sections 5, 7 or 8 of this
Agreement.
5. Release By AII and the Executive.
(a) As a material inducement for the Company to enter into
this Agreement and to pay the AII and the Executive the amounts and provide the
benefits contemplated hereunder, each of AII and the Executive, on behalf of
themselves, their agents, assignees, attorneys, successors, assigns (and in the
case of the Executive, his heirs and executors), agrees to and does hereby fully
and completely forever release the Company and its subsidiaries, affiliates,
predecessors and successors and all of their respective past and/or present
officers, directors, partners, members, managing members, managers, employees,
agents, representatives, administrators, attorneys, insurers and fiduciaries in
their individual and/or representative capacities (hereinafter collectively
referred to as "Employer Releasees"), from any and all causes of action, suits,
agreements, promises, damages, disputes, controversies, contentions,
differences, judgments, claims, debts, dues, sums of money, accounts,
reckonings, bonds, bills, specialities, covenants, contracts, variances,
trespasses, extents, executions and demands of any kind whatsoever, which AII or
the Executive or their heirs, executors, administrators, successors and assigns
(as applicable) ever had, now
9
9
have or may have against the Employer Releasees or any of them, in law,
admiralty or equity, whether known or unknown to AII or the Executive, for,
upon, or by reason of, any matter, course or thing whatsoever from the beginning
of the world to the date of this Agreement, including, without limitation, in
connection with or in relationship to AII's or the Executive's employment or
other service relationship with the Company or its affiliates, the termination
any such employment or service relationship, and all matters referred to in the
Prior Agreement and any applicable employment, compensatory or equity
arrangement with the Company or its respective affiliates; provided that such
released claims shall not include any claims to enforce AII's or the Executive's
rights under, or with respect to, (A) this Agreement (including the provisions
of the Prior Agreement that have expressly been made to survive the termination
of the Prior Agreement pursuant to Section 1 hereof) and (B) any Vested Benefits
(such released claims are collectively referred to herein as the "Released
Executive Claims").
(b) Notwithstanding the generality of clause (a) above, the
Released Executive Claims include, without limitation, (i) any and all claims
under Title VII of the Civil Rights Act of 1964, the Age Discrimination in
Employment Act of 1967, the Civil Rights Act of 1971, the Civil Rights Act of
1991, the Fair Labor Standards Act, the Employee Retirement Income Security Act
of 1974, the Americans with Disabilities Act, the Family and Medical Leave Act
of 1993, and any and all other federal, state or local laws, statutes, rules and
regulations pertaining to employment or otherwise, and (ii) any claims for
wrongful discharge, breach of contract, fraud, misrepresentation or any
compensation claims, or any other claims under any statute, rule or regulation
or under the common law, including
10
10
compensatory damages, punitive damages, attorney's fees, costs, expenses and all
claims for any other type of damage or relief.
6. Release By the Company.
(a) As a material inducement for AII and the Executive to
enter into this Agreement, the Company agrees to and does hereby fully and
completely forever release each of AII and the Executive, and their heirs,
executors, administrators, successors and assigns (as applicable) (hereinafter
collectively referred to as "AII Releasees") from any and all causes of action,
suits, agreements, promises, damages, disputes, controversies, contentions,
differences, judgments, claims, debts, dues, sums of money, accounts,
reckonings, bonds, bills, specialities, covenants, contracts, variances,
trespasses, extents, executions and demands of any kind whatsoever that the
Company ever had, now has or may have against the AII Releasees, in law,
admiralty or equity, whether known or unknown to the Company, for, upon, or by
reason of, any matter, course or thing whatsoever from the beginning of the
world to the date of this Agreement, including, without limitation, in
connection with or in relationship to AII's or the Executive's employment or
other service relationship with the Company or its affiliates, the termination
any such employment or service relationship, and all matters referred to in the
Prior Agreement and any applicable employment, compensatory or equity
arrangement with the Company or its affiliates; provided that such released
claims shall not include (i) any claims to enforce the Company's rights under
this Agreement (including the provisions of the Prior Agreement that have
expressly been made to survive the termination of the Prior Agreement pursuant
to Section 1 hereof) and (ii) any claims that involve fraud or willful
misconduct on the part of the Executive, or, in
11
11
connection with his position as a director of the Company, otherwise involve
claims for liability that cannot be eliminated under Section 607.0831 of the
Florida Business Corporation Law, if applicable, or under Section 102(7) of the
General Corporation Law of Delaware, if applicable (such released claims are
collectively referred to herein as the "Released Employer Claims").
7. Certain Additional Agreements.
(a) Each of AII and the Executive on the one hand, and the
Company, on the other hand, represents, covenants and agrees to the other that
neither they, nor their agents, assignees, attorneys, heirs or executors (as
applicable) have commenced, continued or joined in, and will not hereafter
commence, continue, or join in, any lawsuit, arbitration or other action
asserting any Released Executive Claim or Released Employer Claim, respectively,
against the other (including the AII Releasees and the Employer Releasees) or in
any other manner attempt to assert any Released Executive Claim or Released
Employer Claims, respectively, against the other (including the AII Releasees
and the Employer Releasees).
(b) Each of the parties hereto understands and agrees that the
Company's payment of amounts hereunder and AII's and the Executive's signing of
this Agreement do not in any way indicate that the Company or AII or the
Executive has any viable claims against the other or that any party hereto
admits any liability to the other whatsoever.
8. Confidentiality and Other Covenants.
(a) Confidentiality. Each of AII and the Executive agrees that
they shall not at any time (whether during or after the Consulting Term)
disclose or use for their own benefit or purposes or the benefit or purposes of
any other person
12
12
or entity (other than the Company and its direct or indirect subsidiaries and
affiliates) any trade secrets, information, data or other confidential
information relating to current or former customers, development programs,
costs, marketing, trading, investment, sales activities, promotion, credit and
financial data, manufacturing processes, financing methods, plans, or other
business and affairs of the Company or its direct or indirect subsidiaries and
affiliates generally; provided that the foregoing shall not apply to information
which is generally known to the public other than as a result of AII's or the
Executive's breach of this covenant. AII and the Executive agree that they will
promptly return to the Company all memoranda, books, papers, plans, information,
letters and other data, and all copies thereof or therefrom, in any way relating
to the business of the Company or its direct or indirect subsidiaries and
affiliates. Each of AII and the Executive further agrees that they will not
retain or use for their own account at any time any trade names, trademark or
other proprietary business designation used or owned in connection with the
business of the Company or its direct or indirect subsidiaries and affiliates.
(b) Non-Solicitation. Each of AII and the Executive agrees
that they will not at any time prior to the scheduled expiration of the
Consulting Term directly or indirectly solicit, or induce, any employee or
client of the Company or its direct or indirect subsidiaries or affiliates to
terminate his or her employment or client relationship with the Company or its
direct or indirect subsidiaries or affiliates. In addition, each of AII and the
Executive agrees that they will not directly or indirectly employ or offer
employment to any person who was employed by the Company or its direct or
indirect subsidiaries or affiliates unless such person shall have ceased to be
employed by the Company or its direct or indirect subsidiaries or affiliates for
a
13
13
period of at least twelve (12) months; provided that the restriction set forth
in this sentence shall not apply (i) with respect to any such person who shall
have ceased to be employed by the Company or its direct or indirect subsidiaries
or affiliates as a result of a termination by their employer without cause, (ii)
after the one year anniversary of the Consulting Commencement Date, with respect
to any of the individuals previously disclosed to the Company's Board of
Directors who prior to January 1, 1993 were employed by any company with respect
to which the Executive served as Chief Executive Officer during the time that
the Executive served as the Chief Executive Officer of such company and (iii) to
the employee whose name has previously been given, in writing, to the Company.
As to the employee referred to in clause (iii), the Company agrees that, during
the Consulting Term, the arrangements currently in effect with respect to such
employee's duties, and the arrangements for AII to compensate the Company with
respect to certain services performed for AII by such employee, shall remain in
effect as long as such employee remains employed by the Company. Notwithstanding
anything to the contrary in this Section 8(b), prior to contacting an employee
of the Company with a view towards offering employment to such employee, the
Executive may request consent to do so, by a letter to the then Chief Executive
Officer of the Company, who will respond within a reasonable time to such
request for consent.
(c) Non-Disparagement.
(i) Each of AII and the Executive agrees that they
shall not at any time (whether during or after the Consulting Term) make
negative statements or representations, or otherwise communicate negatively,
directly or indirectly, in writing or orally, or otherwise, or take any action
which may, directly
14
14
or indirectly, disparage or be damaging to the Company or its direct or indirect
subsidiaries or affiliates or any of their respective current or former
customers, successors, officers, directors, employees, business or reputation,
other than to the extent reasonably necessary in order (x) to assert a bona fide
claim that is not a Released Executive Claim or (y) give appropriate testimony
in a legal or regulatory proceeding.
(ii) The Company agrees that it shall not at any time
(whether during or after the Consulting Term) make negative statements or
representations, or otherwise communicate negatively, directly or indirectly, in
writing or orally, or otherwise, or take any action which may, directly or
indirectly, disparage or be damaging to AII or the Executive, other than to the
extent reasonably necessary in order (x) to assert a bona fide claim that is not
a Released Employer Claim or (y) give appropriate testimony in a legal or
regulatory proceeding.
(iii) Each of AII, the Executive and the Company
agree that a press release substantially in the form attached hereto as Exhibit
II announcing the Executive's resignation from the Company shall not violate
this Section 8(c).
(d) Remedies. Each of AII and the Executive acknowledges and
agrees that the remedies available to the Company at law for a breach or
threatened breach of any of the provisions of Section 8 would be inadequate and,
in recognition of this fact, each of AII and the Executive agrees that, in the
event of a breach or threatened breach, in addition to any remedies at law, the
Company shall be entitled to obtain equitable relief in the form of specific
performance, temporary restraining order, temporary or permanent injunction or
any other equitable remedy
15
15
that may then be available. The Company acknowledges and agrees that the
remedies available to AII and the Executive at law for a breach or threatened
breach of any of the provisions of Section 8(c) would be inadequate and, in
recognition of this fact, the Company agrees that, in the event of a breach or
threatened breach, in addition to any remedies at law, AII and the Executive
shall be entitled to obtain equitable relief in the form of specific
performance, temporary restraining order, temporary or permanent injunction or
any other equitable remedy that may then be available.
9. Legal Fees. The Company will reimburse the Executive for the
reasonable legal fees incurred by the Executive in connection with the
negotiation and preparation of this Agreement up to a maximum of $20,000, and,
in addition, for reasonable legal fees incurred by the Executive in any
successful action to defend or enforce this Agreement or successful action to
collect payments (in the form of cash compensation or otherwise) from the
Company under this Agreement or the securities issuable under Section 6 of the
Prior Agreement.
10. Acknowledgment; Effectiveness.
(a) The Executive acknowledges that he has read this Agreement
carefully, has been advised to consult an attorney and any other advisors of his
choice, and fully understands that by signing below the Executive is giving up
any right that he may have to xxx or bring any Released Executive Claims against
the Employer Releasees. The Executive acknowledges that he has not been forced
or pressured in any manner whatsoever to sign this Agreement and the Executive
agrees to all its terms voluntarily. To the extent that Executive has executed
this Agreement within less than twenty-one (21) days after its delivery to the
Executive, the Executive
16
16
acknowledges that his decision to execute this Agreement prior to the expiration
of such twenty-one (21) day period was entirely voluntary.
(b) The Executive has not relied on any representations,
promises or agreements of any kind made to him in connection with his decision
to accept the terms of the Agreement except for those set forth in this
Agreement.
(c) The parties hereto agree, and the Executive understands,
that the Executive has seven (7) days from the date he has signed this Agreement
below to revoke this Agreement and the release contained herein, that this
Agreement will not become effective until the eighth (8th) day following the
date that the Executive has signed this Agreement, and that the Company will
have no obligation to make the payments set forth in this Agreement unless and
until this Agreement becomes effective.
11. Entire Agreement; Amendment. This Agreement, together with
provisions of the Prior Agreement referred to in Section 1 hereof, sets forth
the entire understanding of the parties with respect to the subject matter
hereof and cannot be amended or modified except by a writing signed by all such
parties.
12. Governing Law; Severability. This Agreement shall be governed by
and interpreted in accordance with the laws of the State of Florida, without
giving effect to the choice-of-law provisions thereof. If, under such law, any
portion of this Agreement is at any time deemed to be in conflict with any
applicable statute, rule, regulation or ordinance, such portion shall be deemed
to be modified or altered to conform thereto or, if that is not possible, to be
omitted from this Agreement, and the invalidity of such portion shall not affect
the force, effect and validity of the remaining portion hereof. With respect to
any suit, action or proceeding relating to
17
17
this Agreement or to the transactions contemplated hereby ("Proceedings"), each
party irrevocably (i) submits to the exclusive jurisdiction of the courts of the
State of Florida and (ii) waives any objection that it may have at any time to
the laying of venue of any Proceedings brought in any such court, waives any
claim that such Proceedings have been brought in an inconvenient forum and
further waives the right to object, with respect to such Proceedings, that such
court does not have jurisdiction over such party.
13. Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed an original but all of which together shall
constitute one and the same instrument.
14. Notices. Any and all notices or consents required or permitted
to be given under any of the provisions of this Agreement shall be in writing or
by written telecommunication and delivered either by hand delivery or by
registered or certified mail, return receipt requested, to the relevant
addresses set out below, in which event they shall be deemed to have been duly
given upon receipt.
If to AII or the Executive, at:
Anchor Industries International, Inc.
0000 Xxxxx Xxxxx Xxxxx Xxxxx
Xxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxx
Telecopy: (000) 000-0000
With a copy to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxx, Esq.
Telecopy: (000) 000-0000
If to the Company, at:
18
18
Harvard Industries, Inc.
c/o Smith Management Company
000 Xxxxx Xxxxxx - 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx X. Xxxxx
Telecopy: (000) 000-0000
With a copy to:
Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx
1285 Avenue of the Americas
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxxxx X. Xxxxxx, Esq.
Telecopy: (000) 000-0000
IN WITNESS WHEREOF, the undersigned have caused this Agreement to be
executed as of the date first above written.
HARVARD INDUSTRIES, INC.
By: /s/ XXXX X. XXXXX
----------------------------
Name: Xxxx X. Xxxxx
Title: On behalf of the
Board of Directors
ANCHOR INDUSTRIES INTERNATIONAL, INC.
By:
----------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Chairman and Chief
Executive Officer
-------------------------------
Xxxxxxx X. Xxxxxxx
19
EXHIBIT I
AMENDMENT
THIS AMENDMENT ("Amendment") is made as of this 12th day of
February, 1997 by and between Harvard Industries, Inc., (the "Company") and
Xxxxxxx X. Xxxxxxx, as Trustee (the "Trustee") of the Xxxxxxx X. Xxxxxxx 1992
Insurance Trust (the "Trust"), to that certain Split Dollar Life Insurance
Agreement Collateral Assignment Method dated as of the 26th day of March, 1996
by and between the Company and the Trustee (the "Agreement").
WHEREAS, the Company, Anchor Industries International, Inc. ("AII"),
and Xxxxxxx X. Xxxxxxx (the "Executive") have entered into a Termination,
Consulting and Release Agreement dated as of the date hereof pursuant to which,
among other things, the Amended and Restated Management and Option Agreement
among the Company, AII and the Executive (the "AII Agreement") shall be
terminated;
WHEREAS, the parties hereto wish to amend the Agreement to provide
that the Agreement shall not terminate upon the termination of the AII Agreement
and to provide that the Company's premium contribution obligations shall
hereinafter cease, as more fully set forth below.
NOW, THEREFORE, the parties named above agree as follows:
Capitalized terms used herein without definition have the meanings
specified in the Agreement.
20
2
SECTION 1. Paragraph 8 of the Agreement is hereby modified by
deleting Subparagraph (b) such that the Agreement shall not terminate as a
result of the termination of the "AII Agreement".
SECTION 2. Paragraph 4 of the Agreement is hereby modified to (i)
provide that the Company's obligation to make annual premium payments shall
cease as of the date hereof, and to relieve the Company from any further
obligation to bonus the Executive an amount equal to the economic benefit of the
life Insurance protection enjoyed by the under the Policy, or otherwise and (ii)
provide that the Executive shall cause the Trustee to make annual premium
payments to the Trust in an amount equal to the annual premiums previously
payable by the Company pursuant to Paragraph 4 without giving effect to this
Amendment.
SECTION 3. The Collateral Assignment of Split Dollared Policy, dated
March 26, 1996, by the Trustees and the Corporation shall be amended as set
forth in the attached Exhibit A (the "Amended Collateral Assignment").
SECTION 4. This Amendment shall not be effective unless and until
the Company shall receive acknowledgment from Xxxx Xxxxxxx Mutual Life Insurance
Company that it has received the Amended Collateral Assignment. Upon receipt of
such acknowledgment, this Amendment shall be deemed to have become effective as
of the date first above written. Except as expressly modified hereby, the terms
and conditions of the Agreement shall remain in full force and effect. All
references in the Agreement shall, from and after the date hereof, be deemed to
refer to the Agreement as amended hereby.
21
3
SECTION 5. This Amendment (and the Agreement as amended hereby)
shall bind all parties, their successors and assigns and any Policy beneficiary.
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first above written.
HARVARD INDUSTRIES, INC.
00-0000000 By: /s/ XXXXXXX X. XXXXXX
------------------------------ ---------------------------
Employer Identification Number
XXXXXXXXX XXXXXXX
------------------------------ -------------------------------
Witness Xxxxxxx X. Xxxxxxx, as Trustee
Xxxxxxx X. Xxxxxxx 1992 Insurance Trust
Agreed and Acknowledged
----------------------------
Xxxxxxx X. Xxxxxxx
22
EXHIBIT A
AMENDMENT
THIS AMENDMENT ("Assignment Amendment") is made as of this 12th day
of February, 1997 by Xxxxxxx X. Xxxxxxx, as Trustee (the "Trustee") of the
Xxxxxxx X. Xxxxxxx 1992 Insurance Trust (the "Trust"), to the Assignment (the
"Assignment"), dated March 26, 1996, by the Trustee to Harvard Industries, Inc.
(the "Company").
WHEREAS, the Company, Anchor Industries International, Inc. ("AII"),
and Xxxxxxx X. Xxxxxxx (the "Executive") have entered into a Termination,
Consulting and Release Agreement dated as of the date hereof pursuant to which,
among other things, the Amended and Restated Management and Option Agreement
among the Company, AII and the Executive (the "AII Agreement") shall be
terminated;
WHEREAS, the parties hereto have amended that certain Split Dollar
Life Insurance Agreement Collateral Assignment Method dated as of the 26th day
of March, 1996 by and between the Cmopany and the Trustee (the "Agreement") to
provide that the Agreement shall not terminate upon the termination of the AII
Agreement and to provide that the Company's premium contribution obligations
shall hereinafter cease, as more fully set forth therein;
WHEREAS, it is a condition of the effectiveness of the Amendment to
the Agreement that this Assignment Amendment be executed and delivered to Xxxx
Xxxxxxx Mutual Insurance Company;
NOW, THEREFORE, the Trustee named agrees as follows:
A new provision shall be added to the Assignment to read as follows:
23
2
13. Notwithstanding anything to the contrary in this Assignment, the
minimum amount covered under this Assignment pursuant to Sections 3 and 4 hereof
shall be $360,734.43 (the cash surrender value as of February 11, 1997) and the
maximum amount shall be $396,218 (the total premiums paid by the Company less
the PS58 cost as of February 11, 1997).
IN WITNESS WHEREOF, this Amendment to the Assignment is executed as
of February 12, 1997.
------------------------------
Xxxxxxx X. Xxxxxxx, Trustee
24
EXHIBIT II
APPROVED FOR PUBLICATION: DATE:
----------- ---------
RELEASE: Immediately
CONTACT: Xxxxxxx X. Xxxxxx Xxxxxxx X. Xxxxxx
Vice President-General Counsel PUBLIC COMMUNICATIONS INC.
HARVARD INDUSTRIES 813//226-2772
813/000-0000 000/460-1422
XXXX X. XXXXX NAMED CHAIRMAN AND CEO
OF HARVARD INDUSTRIES, INC.
XXXXX X. XXXXXXX APPOINTED PRESIDENT
---------------
XXXXXXX X. XXXXXXX WILL CONTINUE AS CONSULTANT TO COMPANY
Tampa, Fla. -- (February 00, 1997) -- Harvard Industries, Inc.
(NASDAQ-HAVA), a major producer of automotive OEM parts and accessories, today
announced that its Board of Directors has accepted the resignation of Xxxxxxx X.
Xxxxxxx as Chairman, President and CEO of the Company. The Board has elected
Xxxx X. Xxxxx as Chairman and CEO and Xxxxx X. Xxxxxxx as President of the
Company. Xxxxxxx will continue his involvement with the Company, as a
consultant, and will assist the Board in its search for a new CEO.
"During the past four years we have been able to position Harvard as a
growth company in an increasingly consolidated and international automotive
supplier marketplace," Xxxxxxx said.
"More than anything, this is a lifestyle issue for me," Xxxxxxx explained.
"I have been privileged to lead Harvard Industries through major changes and
have set the stage for the future. However, I believe it would be very
difficult to continue to
25
2
manage Harvard while fulfilling my other business obligations and still have
time for my family and civic and charitable involvement."
Chairman and CEO Xxxx X. Xxxxx was elected a Director of Harvard in
October 1994. He has been President of Xxxxx Management Company, an investment
firm, since 1984.
Xxxxx stated that he intends to remain as CEO until the Company finds a
new chief executive with appropriate industry experience to lead the Company for
the future. He noted that the Company's future challenge has to be to reverse
its poor financial results for fiscal 1996 and its continuing losses into the
first quarter of 1997, in both cases attributable primarily to the poor
performance of its Xxxxxxx-Xxxxxx subsidiary.
Xxxxx X. Xxxxxxx has been Executive Vice President of the Company since
August 1995 and Senior Vice President from January 1993 to August 1995. Prior to
that, he was President of the Company's subsidiary, Xxxxxxxx-Xxxxxx, from April
1991 to January 1993.
Harvard Industries Inc., through its subsidiaries, designs, develops and
manufactures a broad range of components for original equipment manufacturers,
producing cars and light trucks in North America and abroad.
(35-6475.rel) # # #
