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EXHIBIT 10.10
SEVERANCE COMPENSATION AGREEMENT
This SEVERANCE COMPENSATION AGREEMENT (the "Agreement") is made as of
September 15, 2000 between MCE COMPANIES, INC., a Michigan corporation (the
"Company"), and XXXX X. XXXXXXX, currently an executive officer of the Company
employed in the position of President and Chief Executive Officer of the Company
(the "Executive").
Recitals:
A. The Company and Executive have heretofore agreed to the terms of
Executive's employment by the Company, including those terms and conditions set
forth in that certain Employment Agreement, dated as of December 30, 1996, as
amended by Amendment No. 1 thereto, dated as of August 15, 2000, between the
Company and the Executive (the "Employment Agreement").
B. The Company believes that it is in the best interests of the Company
and its shareholders if the Executive is assured that he will receive
appropriate financial protection in the event of his termination for reasons
other than death, Disability (as defined below), Retirement (as defined below)
or Cause (as defined below) or in the event of his Resignation for Good Reason
(as defined below), thus ensuring that the Executive will have an incentive to
perform valuable services for the Company and will not be distracted in the
event of an actual or threatened termination for such reasons, subject to the
terms and conditions of this Agreement.
C. The Executive is willing to provide dedicated services to the
Company on the condition that he receives adequate assurance that he will
receive appropriate financial protection in the event of his termination by the
Company for reasons other than death, Disability, Retirement or Cause or in the
event of his Resignation for Good Reason, subject to the terms and conditions of
this Agreement.
Agreement:
NOW, THEREFORE, in return for good and valuable consideration and in
consideration of the premises and the mutual promises made hereafter, the
Executive and the Company agree as follows:
1. Involuntary Termination and Resignation for Good Reason. The
Executive shall be entitled to and shall receive the severance payments and
benefits described in Section 2 of this Agreement if, and only if there has been
an Involuntary Termination (as defined below) of the Executive's employment by
the Company or there has been a Resignation for Good Reason, provided that, as a
condition to the Executive receiving the severance payments and benefits
described in Section 2, the Executive shall have executed and delivered to the
Company, and shall not have revoked, the Release and Settlement Agreement in the
form attached hereto as Schedule
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1 prior to or simultaneously with receiving such severance payments and
benefits.
2. Severance Payment and Benefits upon Involuntary Termination or
Resignation for Good Reason. If there has been an Involuntary Termination or a
Resignation for Good Reason, the Executive will be entitled to and shall receive
all of the following:
(a) Salary. A continuance of his salary at one hundred percent
(100%) of his then current base salary, as severance payment, for a period of
twelve (12) months beyond the effective date of any Involuntary Termination or
any Resignation for Good Reason (the "Severance Period"), provided that, in the
event the Executive is entitled to receive the benefits of both the salary
continuation set forth in this Section 2(a) and the liquidated damages set forth
in Section 4(b)(ii) of the Employment Agreement (for a termination without
"Cause" (as defined therein)), then the Executive's rights to such liquidated
damages shall be deferred until such time as the continuation of his salary
under this Section 2(a) has been paid in full and, upon such payment in full,
his rights to such liquidated damages shall be terminated and without force or
effect. Severance will be paid through the Severance Period in conjunction with
the Company's routine payroll or may be paid in a lump sum, at the discretion of
the Company.
(b) Automobile Allowance; Life Insurance Coverage.
(i) A continuance of his automobile allowance at one
hundred percent (100%) of his then current rate of automobile allowance
through the end of the Severance Period; and
(ii) A continuance of his life insurance coverage at
one hundred percent (100%) of his then current rate of life insurance
coverage through the end of the Severance Period, but only to the
extent such continued coverage is permitted by the insurance carrier
providing benefits to similarly situated active employees and can be
obtained by the Company at the same cost the Company would incur for
such coverage but for the Involuntary Termination of the Executive or
the Resignation for Good Reason. The Company disclaims any liability
for disputes relating to the Executive's entitlement to such insurance
coverage, with it being understood and agreed that the underlying
insurance policies shall govern all issues relating to such insurance
coverage.
(c) Accrued Bonus. One hundred percent (100%) of the bonus, if
any, accrued on the books and records of the Company with respect to the
Executive and unpaid as of the effective date of any Involuntary Termination or
any Resignation for Good Reason.
(d) COBRA. Should the Executive elect COBRA health care
continuation coverage in the event of an Involuntary Termination or a
Resignation for Good Reason, he shall pay for the first twelve (12) months of
such COBRA coverage at the same rate he would have paid for health care coverage
if his employment with the Company had not terminated as a result of an
Involuntary Termination or a Resignation for Good Reason. For subsequent months'
COBRA coverage after an Involuntary Termination or a Resignation for Good
Reason, the Executive shall pay the prevailing COBRA rate (up to 102% of the
Company's cost). If the Company's insurance carrier (the Company has the right
to change insurance carriers at any time and at its sole discretion) is willing
to extend the Executive's COBRA coverage to a period of
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time of up to six (6) months beyond the period of time required by COBRA, the
Company will not object to such extension of coverage. The Executive will
continue to pay the prevailing COBRA rate for such extended coverage. The
Executive will not be permitted to extend coverage beyond the maximum period of
time required by COBRA under any of the Company's self-funded or partially
self-funded health options or plans. The Executive's rights under this Section
2(d) shall be in addition to any rights he may have under applicable COBRA laws.
(e) Immediate Vesting of Stock Options, Etc. Any outstanding
stock option or stock appreciation right granted to the Executive by the Company
under the 2000 Stock Incentive Plan or otherwise (regardless of the date of
grant) immediately shall become fully vested and exercisable in full, regardless
of any installment provision applicable to such stock option or stock
appreciation right, and the remaining restriction period on any restricted stock
granted to the Executive by the Company under the 2000 Stock Incentive Plan or
otherwise (regardless of the date of grant) immediately shall lapse and the
shares shall become fully transferable, subject to any applicable federal or
state securities laws.
(f) Offset upon Subsequent Employment. In the event that the
Executive finds subsequent employment prior to the termination of the Severance
Period, the remaining payments under Sections 2(a), (b), (c) and (d) above will
be offset by the salary, automobile allowance, life insurance coverage, accrued
bonus and healthcare coverage, as the case may be, actually received by the
Executive in his subsequent employment.
(g) Reduction for "Parachute Payments". Notwithstanding
anything in this Agreement to the contrary, the cash payments described in this
Section 2, when aggregated with any other "parachute payments", as defined under
Section 280G of the Internal Revenue Code of 1986, as amended (the "Code"),
payable under any other plans, agreements or policies of the Company, shall be
reduced to the highest amount permissible under Sections 280G and 4999 of the
Code before the Executive becomes subject to the excess parachute payment excise
tax under Section 4999 of the Code and the Company loses all or part of its
compensation deduction for such payments.
3. Rights upon Change in Control. In the event of a Change in Control
(as defined below), any outstanding stock option or stock appreciation right
granted to the Executive by the Company under the 2000 Stock Incentive Plan or
otherwise (regardless of the date of grant) immediately shall become fully
vested and exercisable in full, regardless of any installment provision
applicable to such stock option or stock appreciation right, and the remaining
restriction period on any restricted stock granted to the Executive by the
Company under the 2000 Stock Incentive Plan or otherwise (regardless of the date
of grant) immediately shall lapse and the shares shall become fully
transferable, subject to any applicable federal or state securities laws,
provided that, at the request of the Company, as a condition to the Executive
receiving the rights described in this Section 3, the Executive shall have
executed and delivered to the Company, and shall not have revoked, the Release
and Settlement Agreement in the form attached hereto as Schedule 1 prior to or
simultaneously with receiving such rights (such form to be modified such that
the release contained therein shall be with respect to matters arising from
facts and circumstances occurring prior to or as of such date, shall exclude any
matter arising from facts and circumstances occurring after such date and shall
exclude any obligations of the Company due to the Executive relative to the
Executive's employment with the Company), and provided further
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that it is acknowledged and agreed that, depending on the facts and
circumstance, the Executive may be obligated to execute and deliver such a
Release and Settlement Agreement both in connection with this Section 3 and in
connection with Section 1.
4. Defined Terms. For purposes of this Agreement, the following terms
shall have the meanings set forth below:
(a) "Accepted Duties" shall mean the Executive's current
duties and responsibilities as President and Chief Executive Officer of the
Company, or as any other officer or in any other position to which the Executive
is appointed and in which he mutually agrees to serve (collectively, the
"Accepted Duties").
(b) "Affiliated Group" shall mean, at any time, the Company
and any of its direct or indirect subsidiaries (whether now or hereinafter in
existence) and any of its other affiliates which are controlled by the Company
(whether now or hereinafter in existence), including, without limitation, as of
the date hereof, the following subsidiaries of the Company: DML Microwave
Limited; Inmet Corporation; KDI/Triangle Corporation; Metelics Corporation; and
Weinschel Corporation.
(c) "Cause" shall mean a termination of the Executive's
employment by the Company for any of the following reasons:
(i) the Executive's failure to substantially perform
his services with respect to his Accepted Duties, in any material
manner, other than any such failure resulting from his Disability or
for Good Reason, including the failure to comply in any material manner
with the policies, rules or directives of the Chairman, President or
Chief Executive Officer of the Company or of the Board of Directors of
the Company, with such failure to be determined in the good faith
opinion of the Board of Directors by the affirmative vote of at least
two-thirds of the directors (but not including the Executive if the
Executive is a Director), provided that the Executive shall have
received ninety (90) days prior written notice of the Board's concern
with respect to such failure and shall have failed to cure such failure
within such ninety (90) day period; or
(ii) the Executive's engaging in any serious
misconduct which, in the good faith opinion of the Board of Directors
of the Company by affirmative vote of two-thirds of the directors (but
not including the Executive if the Executive is a Director), is
substantially injurious to the Company's business (it being understood
that such misconduct shall be deemed substantially injurious only if
the injury is reasonably likely to exceed $100,000); or
(iii) the Executive's performance of any act or acts
of dishonesty resulting or intended to result directly or indirectly in
significant gain or personal enrichment at the expense of the Company,
with the foregoing to be determined in the good faith opinion of the
Board of Directors by the affirmative vote of at least two-thirds of
the directors (but not including the Executive if the Executive is a
Director); or
(iv) The Executive's gross negligence or willful
misconduct in the
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performance of his Accepted Duties, in any material manner, other than
any such failure resulting from his Disability or for Good Reason, with
such gross negligence or willful misconduct to be determined in the
good faith opinion of the Board of Directors by the affirmative vote of
at least two-thirds of the directors (but not including the Executive
if the Executive is a Director), provided that the Executive shall have
received ninety (90) days prior written notice of the Board's concern
with respect to such gross negligence or willful misconduct and shall
have failed to cure same within such ninety (90) day period; or
(v) the Executive's conviction of a felony,
misdemeanor resulting in a jail sentence or any crime involving moral
turpitude; or
(vi) any material breach by the Executive of the
obligations set forth below in Section 8.
(d) As used herein "Change in Control" means the occurrence of
any one of the following events:
(i) If any "person" (as such term is used in Sections
13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act")) or group of persons acting in concert (other than (A)
the Company, (B) a subsidiary, (C) the current holders of Common Stock
or securities providing a holder the right to acquire Common Stock or
the "affiliates" (as such term is defined in Rule 12b-2 promulgated
under the Exchange Act) of such current holders, or (D) an employee
benefit plan or employee benefit plan trust maintained by the Company
or a subsidiary) becomes the "beneficial owner" (as such term is
defined in Rule 13d-3 promulgated under the Exchange Act, except that a
person also shall be deemed the beneficial owner of all securities
which such person may have a right to acquire, whether or not such
right is presently exercisable), directly or indirectly, of securities
of the Company representing fifty percent (50%) or more of the combined
voting power of the Company's then outstanding securities ordinarily
having the right to vote in the election of directors; provided that
the occurrence of an initial public offering or subsequent public
offering of the securities of the Company under the Securities Act of
1933, as amended, shall be excluded from the foregoing. Notwithstanding
the foregoing, the beneficial ownership requirement in this Section
4(d)(i) shall not be satisfied if the attainment of the applicable
percentage of beneficial ownership is the result of an acquisition of
voting stock by the Company which, by reducing the number of shares
outstanding, increases the proportionate number of shares beneficially
owned by any person; provided, however, that, if a person shall become
the beneficial owner of 50% or more of the voting stock of the Company
then outstanding by reason of share purchases by the Company and shall,
after such share purchases by the Company, become the beneficial owner
of any additional voting stock, then the beneficial ownership
requirement in this Section 4(d)(i) shall have been satisfied.
(ii) If there shall be consummated any merger or
consolidation (or series of mergers or consolidations) of the Company,
or any sale, lease, exchange, liquidation or other transfer (in one
transaction or a series of related transactions) of all, or
substantially all, of the assets of the Company, other than (A) a
merger or consolidation which would result in the voting stock of the
Company immediately prior thereto
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continuing to represent (either by remaining outstanding or by being
converted into voting stock of the surviving entity) more than 60% of
the combined voting power of the voting stock of the Company (or such
surviving entity) outstanding immediately after such merger or
consolidation, or (B) a merger or consolidation effected to implement a
recapitalization (or similar transaction) of the Company in which no
person becomes the owner of 50% or more of the combined voting power of
the then outstanding voting stock of the Company, or (C) a merger or
consolidation effected to implement a reorganization of the Company's
ownership wherein the Company shall become a wholly-owned subsidiary of
another corporation and the shareholders of the Company shall become
shareholders of such other corporation without any material change in
each shareholder's proportionate ownership of such other corporation
from that owned in the Company prior to such merger or consolidation.
(iii) If there is the addition of new members to the
Board of Directors of the Company within any consecutive twenty-four
(24) month period, which members constitute a majority of the Board,
unless a majority of the Board consists of incumbent members of the
Board in office prior to the commencement of such twenty-four (24)
month period, plus new members who were recommended or appointed by a
majority of the incumbent directors in office immediately prior to the
addition of such new members to the Board.
(e) "Disability" shall mean the Executive's total and
permanent disability which prevents the Executive from performing his Accepted
Duties for a continuous period exceeding nine (9) months. The determination of
Disability shall be made by a medical board certified physician mutually
acceptable to the Company and the Executive (or the Executive's legal
representative, if one has been appointed), and if the parties cannot mutually
agree to the selection of a physician, then each party shall select such a
physician and the two physicians so selected shall select a third physician who
shall make this determination. The Company and the Executive shall each bear
one- half of the fees and expenses for all such physicians.
(f) "Involuntary Termination" shall mean an involuntary
termination of the Executive's employment by the Company for any reason other
than death, Disability, Retirement or Cause.
(g) "Good Reason" shall mean any of the following, provided
that the Company shall have received ninety (90) days prior written notice of
the Executive's concern with respect to any of the following and shall have
failed to cure such failure within such ninety (90) day period:
(i) A material change by the Company in the
Executive's then Accepted Duties which is inconsistent with and
materially less important than the then Accepted Duties;
(ii) A reduction by the Company in the Executive's
base compensation; or
(iii) The Company's relocation of the Executive's
principal place of employment to a place more than thirty (30) miles
from 000 Xxxx Xxxxx, Xxx Xxxxx,
0
Xxxxxxxx.
(h) "Resignation for Good Reason" shall mean a termination of
the Executive's employment by resignation of the Executive for Good Reason.
(i) "Retirement" shall mean retirement by the Executive on or
after age 65.
(j) "2000 Stock Incentive Plan" shall meant the MCE Companies,
Inc. 2000 Stock Incentive Plan adopted by the Company's Board of Directors on
July 20, 2000 and subsequently approved by the Company's shareholders effective
as of August 15, 2000.
5. Notice of Voluntary Termination. The Executive agrees that if he
decides to terminate his employment with the Company of his own volition,
including any Resignation for Good Reason, he will provide the Company with at
least thirty (30) days prior written notice.
6. Tax Withholding. The Company shall use its best commercially
reasonable efforts to withhold from any amounts payable to the Executive under
this Agreement such sums as are necessary to satisfy all applicable Federal,
State, local or other income and employment withholding taxes. In the event the
Company fails to withhold such sums for any reason, the Executive shall
promptly, upon a request by the Company, remit to the Company sufficient cash to
satisfy all applicable income and employment withholding taxes.
7. Termination of Certain Obligations of the Company. The Company's
obligations under Sections 1, 2 and 3 of this Agreement shall terminate upon the
termination of the Executive's employment upon death, Disability, Retirement or
Cause.
8. Confidentiality and Noncompetition Matters. The Executive hereby
acknowledges and recognizes the competitive nature of the business of the
Company and, accordingly, in partial consideration of the consummation of this
Agreement, and regardless of whether the Executive is entitled to receive any
severance compensation payments under this Agreement, the Executive agrees as
follows:
(a) Confidentiality Matters. The Executive agrees to at all
times during and after his employment with the Company (regardless of whether
there occurs an Involuntary Termination or a Resignation for Good Reason) to
hold in confidence and keep secret and inviolate all of the confidential
information of the Affiliated Group, including, without limitation, all
unpublished matters relating to the business, property, accounts, books,
records, customers and contracts of the Company which he may or hereafter come
to know; provided, however, that the Executive may:
(i) disclose any such information which (A) has
otherwise entered the public domain (other than through a breach of
this Agreement) or which he is required to disclose to any governmental
authority by law or subpoena or judicial process, or (B) was available
to the Executive on a nonconfidential basis prior to the disclosure,
provided that the source of such information was not known by the
Executive to be bound by a confidentiality agreement with or other
contractual, legal or fiduciary obligation of confidentiality to the
Company with respect to such information.
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(ii) disclose so much of such information to personal
tax or financial advisors as may be reasonably appropriate to enable
such advisors to render appropriate advice to the Executive.
(b) Noncompetition Matters.
(i) Covenant. The Executive agrees that, during the
Noncompetition Period (as defined below), the Executive will not,
directly or indirectly, whether as an officer, director, executive,
proprietor, employee, partner, investor (other than as a holder of less
than five percent (5%) of the outstanding stock of a publicly-traded
corporation), consultant, independent contractor, advisor, agent, or
otherwise, engage in any Business Activities (as defined below) in
competition with the Affiliated Group in the United States and
throughout the world, provided that, for purposes of this Section 8(b),
the composition of the Affiliated Group shall be determined and fixed
as of the effective time of the termination of the Executive's
employment with the Company.
(ii) Noncompetition Period. As used herein, the term
"Noncompetition Period" shall mean the period commencing with the date
hereof and ending on the earlier to occur of (A) the effective date of
any termination by the Company of the Executive's employment with the
Company without Cause (and for reasons other than Disability), or (B)
the first (1st) anniversary of the effective date of any Resignation
for Good Reason or any termination of the Executive's employment with
the Company arising from a Disability.
(iii) Business Activities. As used herein, the term
"Business Activities" shall mean the business activities of the
Affiliated Group as presently conducted or as conducted in the future
(but in no event after the effective time of the termination of the
Executive's employment with the Company), including, without
limitation, the design, manufacture and sale of devices, components and
subsystems which operate over the full range of frequencies commonly
used in wireless communications transmission and which are used
throughout mobile and fixed wireless infrastructure equipment and
related test equipment applications, as well as wireless broadband
access, fiber optic networking, radar and satellite applications.
(c) Irreparable Harm; Injunctive Relief. The Executive
acknowledges that if he violates the terms of this Section 8, he will cause
severe and irreparable injury to the business and goodwill of the Company, which
injury is not adequately compensable by money damages. Accordingly, in the event
of a breach of this Section 8, the Company shall, in addition to any other
rights and remedies, be entitled to immediate and appropriate injunctive relief,
or a decree of specific performance of this Agreement, without the necessity of
showing any irreparable injury or special damages, in an appropriate court
having equitable jurisdiction in the matter, provided, however, that this shall
in no way limit any other remedies which the Company may have (including,
without limitation, the right to seek monetary damages).
(d) Enforceability; Acknowledgments of the Parties. The
parties agree and acknowledge that the restrictions contained in this Section 8
are reasonable in scope and duration
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and are necessary to protect the Company. If the terms of this Section 8 shall
be held by a court to be invalid or unenforceable because it is too broad in any
respect, this Agreement shall be narrowed by the court to the extent deemed
necessary by the court to be enforceable and the same shall in no way affect any
other circumstance or the validity or enforceability of any other provisions of
this Agreement. It is the intent of the parties that a court enforce these
restrictions to the fullest extent permitted by law.
9. Effect on Employment. Neither this Agreement, nor the rights and
obligations set forth herein, shall be deemed to create any right with respect
to the Executive to be retained or continued in the employment of the Company or
any of its subsidiaries.
10. Arbitration. The Company and the Executive agree that, except for
the injunctive relief described above in Section 8(d), any and all disputes,
claims or controversies arising in connection with this Agreement shall be
finally settled by arbitration pursuant to the Voluntary Labor Arbitration Rules
of the American Arbitration Association, as then in effect. In the event of any
conflict between such Rules and the provisions of this Agreement, the provisions
of this Agreement shall govern. In selecting the eligible arbitrators, the
American Arbitration Association will give due consideration to the subject
matter of the dispute. The arbitrator's(s') sole authority shall be to interpret
and apply the provisions of this Agreement and, in connection therewith, the
arbitrator(s) shall not change, add to, or subtract from, any of the provisions
of this Agreement. The arbitrator(s) shall have the power to compel attendance
of witnesses at the hearing. The arbitration hearing shall be conducted in the
metropolitan area of Ann Arbor, Michigan. All expenses of the arbitration shall
be divided equally between the Company and the Executive. Each of the Company
and the Executive shall be responsible for its/his own legal fees and other
costs relating to the arbitration proceeding. Any decision, award and/or
judgment rendered by the arbitrators may be entered in and enforced by any court
having competent jurisdiction thereof.
11. Binding Effect.
(a) This Agreement shall be binding upon the successors and
assigns of the Company. The Company shall take whatever actions are necessary to
ensure that any successor to its operations (whether by purchase, merger,
consolidation, sale of substantially all assets or otherwise) assumes the
obligations under this Agreement and will cause such successor to evidence the
assumption of such obligations in an agreement satisfactory to the Executive.
Notwithstanding any other provisions in this Agreement to the contrary, if the
Company fails to obtain an agreement evidencing the assumption of the Company's
obligations by any such successor, the Executive shall receive payment of the
severance compensation provided hereunder immediately after the effective
time of any such succession, irrespective of whether there has occurred an
Involuntary Termination or Resignation for Good Reason. For purposes of
implementing the foregoing, the date on which any succession becomes effective
shall be deemed to constitute the date of the Executive's Involuntary
Termination or Resignation for Good Reason.
(b) This Agreement shall be binding upon the Executive and
shall inure to the benefit of and be enforceable by his estate, legal
representatives and heirs. However, the rights of the Executive under this
Agreement shall not be assigned, transferred, pledged, hypothecated or
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otherwise encumbered, except by operation of law.
12. Notices. Any notice required or permitted by this Agreement shall
be in writing, addressed as follows:
Company: If to the Company, to the following address:
MCE Companies, Inc.
000 Xxxx Xxxxx
Xxx Xxxxx, Xxxxxxxx 00000
000-000-0000; fax 000-000-0000
Attn: Xxx X. Xxxxxxx
e-mail: xxxxxxxx@xxxxxxxxxxxx.xxx
with a copy to:
Xxxxxx Xxxxxxx PLLC
000 Xxxxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: J. Xxxxxxx Xxxxxxx
000-000-0000; fax 000-000-0000
e-mail: xxxxxxxx@xxxxxx.xxx
Executive: If to the Executive, at the Executive's
last home address on file with the Company.
Any party hereto may change the address to which notices, requests, demands,
claims, and other communications hereunder are to be delivered by giving the
other party notice in the manner set forth in this Section 12. Notices shall be
deemed given (a) when received, if physically delivered, (b) when transmitted,
if telephonically transmitted by facsimile transmission and if such transmission
is confirmed within one (1) business day thereafter orally and by delivery by
certified or registered United States Mail (with first class postage pre-paid)
or guaranteed (in the ordinary course) overnight delivery, (c) when transmitted,
if transmitted via e-mail and if such transmission is confirmed within one (1)
business day thereafter orally and by delivery by certified or registered United
States Mail (with first class postage pre-paid) or guaranteed overnight
delivery, (d) five (5) business days after having been deposited in the United
States Mail, as certified or registered mail (with return receipt requested and
with first class postage pre-paid), or (e) one (1) business day after having
been transmitted to a third party providing delivery services in the ordinary
course of business which guarantees (in the ordinary course) delivery on the
next business day after such transmittal (e.g., via Federal Express).
13. Arm's Length Negotiations. Each party herein expressly represents
and warrants to the other that: (a) before executing this Agreement, said party
has fully informed itself or himself of the terms, contents, conditions and
effects of this Agreement; (b) said party has relied solely and completely upon
its own judgment in executing this Agreement; (c) said party has had the
opportunity to seek and/or has obtained the advice of counsel before executing
this
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Agreement; (d) said party has acted voluntarily and of its own free will in
executing this Agreement; (e) said party is not acting under duress, whether
economic or physical, in executing this Agreement; and (f) this Agreement is the
result of arm's length negotiations conducted by and among the parties and their
respective counsel. In addition, the Executive represents and warrants to the
Company that his experience and capabilities are such that he understands the
nature of the restrictions and agreements set forth in this Agreement.
14. Miscellaneous. The invalidity or unenforceability of any provision
of this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement, which shall continue in full force and effect. This
Agreement shall not be deemed to create a contract of employment between the
Company and the Executive and shall create no right in the Executive to continue
in the Company's employment for any specific period of time, or to create any
other rights in the Executive or obligations on the part of the Company, except
as set forth herein. This Agreement shall not restrict the right of the Company
to terminate the Executive, or restrict the right of the Executive to terminate
his employment. The headings in this Agreement are inserted for convenience of
reference only and shall not be a part of or control or affect the meaning of
any provision hereof. 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, and shall bind and shall inure to the benefit of the
parties hereto, and their respective successors and assigns. Copies
(photostatic, facsimile or otherwise) of this Agreement and signatures hereto
shall be deemed to be originals and may be relied on to the same extent as the
manually-signed originals. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF MICHIGAN.
15. Entire Agreement; Modification. This Agreement contains the entire
agreement between the Executive and the Company with respect to the subject
matter hereof. Any modification of this Agreement must be made in writing and
signed by the Executive and the President or other officer specifically
authorized to do so by the Board of Directors of the Company.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the date first written above.
Witness:
MCE COMPANIES, INC.
/s/ Xxxxxx X. Xxxx By: /s/ Xxxxxxx X. Xxxxxx
----------------------------- ---------------------------------
Its: Vice-President - Operations
--------------------------------
/s/ Xxxxxx X. Xxxx /s/ Xxxx X. Xxxxxxx
----------------------------- ------------------------------------
XXXX X. XXXXXXX, the Executive
Attachment:
Schedule 1 Form of Release and Settlement Agreement
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SCHEDULE 1
RELEASE AND SETTLEMENT AGREEMENT
This RELEASE AND SETTLEMENT AGREEMENT (the "Agreement") is made as of
, between MCE COMPANIES, INC., a Michigan corporation (the
"Company"), and (the "Executive").
Recitals:
A. The Company and the Executive are parties to a Severance and
Compensation Agreement dated September 15, 2000 (the "Severance Compensation
Agreement"). Capitalized terms that are not otherwise defined herein shall have
the meanings ascribed to such terms in the Severance Compensation Agreement.
B. Effective as of , (the "Separation Date"), the
Executive's employment with the Company was or will be terminated due to the
occurrence of an Involuntary Termination or the Executive's Resignation for Good
Reason.
C. The Company is not obligated to pay the Executive any additional
compensation or benefits other than that which has been earned as of the
Executive's Separation Date and other than that which is set forth in the
Severance Compensation Agreement. This Agreement is the Release and Settlement
Agreement referenced in the Severance Compensation Agreement and the payment of
the severance benefits set forth in the Severance Compensation Agreement is
conditioned upon the execution and delivery by the Executive of this Agreement.
Agreement:
NOW, THEREFORE, in return for good and valuable consideration and in
consideration of the premises and the mutual promises made hereafter, the
Executive and the Company agree as follows:
1. Severance Compensation Agreement. Subject to the terms and
conditions of the Severance Compensation Agreement, (a) the Company agrees to
pay the Executive the severance payments and to provide the Executive with the
other benefits described in Section 2 of the Severance Compensation Agreement,
to provide the Executive with the rights described in Section 3 of the Severance
Compensation Agreement, and to otherwise comply with the provisions of the
Severance Compensation Agreement, as the case may be, and (b) the Executive
agrees to comply with the confidentiality and noncompetition covenants in
Section 8 of the Severance Compensation Agreement and to otherwise comply with
the provisions of the Severance Compensation Agreement.
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2. Acknowledgment. The Executive and the Company acknowledge that the
amounts to be paid pursuant to the Severance Compensation Agreement are in
excess of any earned wages or benefits due and owing the Executive through his
Separation Date.
3. Release. In exchange for the good and valuable consideration set
forth in Section 1 of this Agreement, the Executive, on behalf of himself, his
heirs, executors and assigns, releases, waives and discharges any and all manner
of action, causes of action, claims, rights, charges, suits, damages, debts,
demands, obligations, attorneys' fees, or any and all other liabilities or
claims of whatsoever nature, whether in law or in equity, known or unknown,
including, but not limited to, any claim and/or claim of damages or other relief
for tort, breach of contract, personal injury, negligence, age discrimination
under The Age Discrimination In Employment Act of 1967 (as amended), employment
discrimination prohibited by other federal, state or local laws, including, but
not limited to, sex, race, national origin, marital status, age, handicap,
height, weight, or religious discrimination, and any other claims for unlawful
employment practices which the Executive has claimed or may claim or could claim
in any local, state or federal forum, against the Company, its directors,
officers, employees, successors and assigns, its and their respective affiliates
and all others, as a result of the Executive's employment at and separation of
employment from the Company, provided that, the Executive and the Company retain
the right to enforce this Agreement and the Severance Compensation Agreement.
4. Irrevocable Bar. The parties intend that this Agreement will
irrevocably bar any action or claim whatsoever by the Executive against the
Company for any resultant injuries or damages, whether known or unknown,
sustained or to be sustained, as a result of any of the Company acts, omissions
and conduct having occurred up to the present date, including, but not limited
to, the Executive's employment with the Company and the termination of that
employment, other than those concerning this Agreement and the Severance
Compensation Agreement.
5. Rights or Claims Arising After the Date Hereof. The Executive and
the Company understand that the Executive is not waiving rights or claims that
may arise after the date this Agreement is executed.
6. Review of Agreement. The Executive understands and agrees that he
has read this Agreement carefully and understands all of its terms.
7. Advice to Consult Attorney. The Executive understands and agrees
that he is advised to consult with an attorney prior to executing this
Agreement.
8. Period within which to Consider Agreement. The Executive understands
and agrees that he has been given 21 days (or more) within which to consider
this Agreement.
9. REVOCATION. THE EXECUTIVE UNDERSTANDS AND AGREES THAT HE MAY
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REVOKE THIS AGREEMENT FOR A PERIOD OF SEVEN (7) CALENDAR DAYS FOLLOWING THE
EXECUTION OF THIS AGREEMENT. NEITHER THIS AGREEMENT NOR THE COMPANY'S
OBLIGATIONS UNDER SECTIONS 1, 2 OR 3 OF THE SEVERANCE COMPENSATION AGREEMENT
SHALL BE EFFECTIVE UNTIL THIS REVOCATION PERIOD HAS EXPIRED (AT WHICH TIME SUCH
OBLIGATIONS SHALL BE EFFECTIVE, RETROACTIVE TO THE TIME CONTEMPLATED IN THE
SEVERANCE COMPENSATION AGREEMENT). WITHOUT LIMITING THE GENERALITY OF THE
FOREGOING, THE PROVISIONS OF SECTION 8 OF THE SEVERANCE COMPENSATION AGREEMENT
(RELATIVE TO CONFIDENTIALITY AND NONCOMPETITION MATTERS) SHALL NOT BE TERMINATED
OR OTHERWISE AFFECTED BY ANY REVOCATION OF THIS AGREEMENT. THE EXECUTIVE
UNDERSTANDS THAT ANY REVOCATION, TO BE EFFECTIVE, MUST BE IN WRITING AND EITHER
(A) POSTMARKED WITHIN SEVEN (7) DAYS OF EXECUTION OF THIS AGREEMENT AND
ADDRESSED TO THE PRINCIPAL EXECUTIVE OFFICES OF THE COMPANY, ATTENTION:
PRESIDENT, OR (B) HAND DELIVERED WITHIN SEVEN (7) DAYS OF EXECUTION OF THIS
AGREEMENT TO THE PRINCIPAL EXECUTIVE OFFICES OF THE COMPANY, ATTENTION:
PRESIDENT. THE EXECUTIVE UNDERSTANDS THAT IF REVOCATION IS MADE BY MAIL, MAILING
BY CERTIFIED MAIL, RETURN RECEIPT REQUESTED, IS RECOMMENDED TO SHOW PROOF OF
MAILING.
10. Voluntary Action; No Reliance. In agreeing to sign this Agreement,
the Executive is doing so completely voluntarily and agrees that he has not
relied on any oral statements or explanations made by the Company or its
representatives.
11. Nondisclosure. Both parties agree not to disclose the terms of this
Agreement to any third party, except as is required by law, or as is necessary
for purposes of securing counsel from either parties' attorneys or accountants.
12. No Disparaging Statements. The Executive and the Company agree not
to make any disparaging statements about the other.
13. Full Accord and Satisfaction. This Agreement is in full accord and
satisfaction and compromise of the claims of the Executive and the Company and
is not to be construed as an admission of liability on the part of the Company.
14. Miscellaneous. The headings in this Agreement are inserted for
convenience of reference only and shall not be a part of or control or affect
the meaning of any provision hereof. 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, and shall bind and shall
inure to the benefit of the parties hereto, and their respective successors and
assigns. Copies (photostatic, facsimile or otherwise) of this Agreement and
signatures hereto shall be deemed to be originals and may be relied on to the
same extent as the manually-signed originals. THIS AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF MICHIGAN.
15. Entire Agreement. Modification. This Agreement contains the entire
agreement between the Executive and the Company with respect to the subject
matter hereof. Any modification of this Agreement must be made in writing and
signed by the Executive and an officer specifically authorized to do so by the
Board of Directors of the Company.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the date first written above.
Witness:
MCE COMPANIES, INC.
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By:
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Its:
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, the Executive
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