EXHIBIT 10.1
(CABOT LOGO)
January 2, 2006
Xx. Xxxx X. Xxxx
000 X. Xxxxxxxxxxx Xx. Xxxx 0
Xxxxxx, XX 00000
Dear Xxxx:
This separation letter ("Separation Agreement") is to confirm that you
have elected to terminate your employment with Cabot Corporation ("Cabot" or the
"Company") effective January 4, 2006 (the "Separation Date"). As a result of the
termination of your employment, on or as of the Separation Date, you will be
entitled to (a) salary through January 4, 2006, (b) payment for accrued vacation
time unused as of January 4, 2006, and (c) continued medical and dental coverage
under the Consolidated Omnibus Budget Reconciliation Act of 1985 ("COBRA"),
details of which are being provided to you. The items set forth above will be
provided to you regardless of whether or not you decide to accept the additional
payments and benefits offered by Cabot in this Separation Agreement.
Except as otherwise stated herein, this Separation Agreement does not
modify or supersede any obligations that you have to Cabot by law or otherwise,
and you understand that you must return all written and other materials
belonging to Cabot and in your possession or control, together with all copies
of such materials, upon termination of your employment.
I invite you to consider the following offer of additional payments and
benefits in exchange for a general release of claims. You should consult with an
attorney before deciding whether to accept this offer. You may accept this offer
only by signing (with signature notarized) a copy of this letter where indicated
below and returning it to Xxxxx X. Xxxxx at Cabot Corporation, Two Xxxxxxx Xxxx,
Xxxxx 0000, Xxxxxx, XX 00000-0000, so that Xx. Xxxxx receives it not later than
January 26, 2006; otherwise this offer shall be null and void. Our offer is as
follows:
1. Within two weeks after the effective date of this Separation Agreement,
Cabot will pay you a lump sum payment in the total amount of
$725,000.00. This payment shall be reduced by any deductions and
withholding that Cabot determines are required by law or otherwise,
prior to payment to you.
2. In exchange for the payments provided to you under this Separation
Agreement, to which you acknowledge you would not otherwise be
entitled, you, on your own behalf and that of
your heirs, executors, administrators, beneficiaries, personal
representatives and assigns, agree that the Separation Agreement shall
be in complete and final settlement of any and all causes of action,
rights or claims, whether known or unknown, that you have had in the
past, now have, or might now have as of the date upon which you sign
and execute this Separation Agreement, in any way related to, connected
with, or arising out of your employment or its termination, whether (a)
sounding in tort, contract or otherwise, (b) pursuant to Title VII of
the Civil Rights Act of 1964, the Americans with Disabilities Act, the
Worker Adjustment and Retraining Notification Act or any similar state
law, the Older Workers Benefit Protection Act, the Age Discrimination
in Employment Act, or the fair employment practices statutes of the
state or states in which you have provided services to the Company, or
(c) pursuant to any other federal, state or local law, regulation or
other requirement. You hereby release and forever discharge the Company
and its subsidiaries and other affiliates and all of their respective
past, present and future directors, shareholders, officers, members,
managers, general and limited partners, employees, agents,
representatives, successors and assigns, any welfare or retirement
plans maintained by Cabot or its subsidiaries, affiliates, or
successors, or any of the trustees or administrators thereof, and all
others connected with any of the foregoing, both individually and in
their official capacities (collectively, the "Releasees"), from any and
all such causes of action, rights or claims, whether known or unknown,
that you have had in the past, now have, or might now have as of the
date upon which you sign and execute this Separation Agreement, in any
way related to, connected with, or arising out of your employment or
its termination.
Notwithstanding the foregoing, this release does not include and will
not preclude: (a) any claim for salary payable through the Separation
Date, or for accrued, unused vacation time as recorded on the Company's
books as of the Separation Date; (b) any claim for vested benefits
payable under any employee benefit plan; (c) claims, actions, or rights
arising under or to enforce the terms of this Separation Agreement; and
(d) claims or rights under COBRA.
3. In signing this Separation Agreement, you affirm that you have been
paid and/or have received all leave (paid or unpaid), compensation,
wages, bonuses, commissions, and/or benefits to which you may be
entitled and that no other leave (paid or unpaid), compensation, wages,
bonuses, commissions and/or benefits are due to you, except as provided
in this Separation Agreement. On or before the Separation Date, Cabot
will provide you with a lump sum payment equal to the vacation days you
had earned but not used. You acknowledge that, upon receiving said
vacation pay, you will have received pay for all work you have
performed for the Company during the current payroll period, to the
extent not previously paid, as well as pay, at your final base rate of
pay, for the vacation days you had earned, but not used, all as of the
Separation Date, determined in accordance with Company policy and as
reflected on the books of the Company.
4. You understand and agree that, except as expressly provided below, your
participation in all employee benefit plans of the Company will end as
of the Separation Date, in accordance with the terms of those plans.
You understand and agree that your rights and obligations with respect
to any stock shares or stock options granted or gifted to you by Cabot
which are vested on or as of the Separation Date shall be governed by
the applicable stock plan and any agreements or other requirements
applicable to those shares or options. You understand and agree that
all stock shares and/or stock options granted or gifted to you by the
Company
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which are not vested on or as of the Separation Date shall be forfeited
or cancelled on or as of the Separation Date in accordance with the
applicable stock plan and any agreements or other requirements
applicable to those shares or options. To the extent you are in
possession of any stock and/or stock option certificates for any stock
shares and/or stock options gifted or granted to you which will not be
vested on or as of the Separation Date, you further agree to return, no
later than the Separation Date, all such certificates in your
possession. In furtherance of the foregoing, and in accordance with
Cabot's 1999 Equity Incentive Plan, within thirty days of the
Separation Date, the Company will purchase from you the 62,500 shares
of Restricted Stock purchased by you in connection with your 2003 and
2004 Long-term Incentive Awards, for an aggregate consideration of
$577,650.00 (the amount you paid for such shares).
Cabot agrees that, for a period of fourteen (14) months following the
Separation Date, Cabot will continue to provide you with the financial
planning benefit received by you from AYCO as an employee of Cabot at
an amount no greater than the amount provided to you in 2005 for such
benefit, in accordance with the Company's AYCO program guidelines, as
in effect from time to time. Cabot reserves the rights to amend,
modify, terminate or discontinue the financial planning benefit
provided by AYCO to its employees and former employees, or the costs
associated therewith, at any time.
5. This Separation Agreement does not affect, modify or alter your rights
to be indemnified by Cabot under Section 14 of Cabot's By-laws and/or
Article Eighth of Cabot's Restated Certificate of Incorporation, as
amended.
6. This Separation Agreement does not affect, modify or alter your
individual rights as an officer or former officer of Cabot to insurance
coverage under Cabot's directors and officers insurance program.
7. You agree that you will continue to keep confidential and protect
Confidential Information, as defined herein, and that, except as
required by law, you will not, directly or indirectly, disclose it to
others or use it for any purpose. As used in this Separation Agreement,
"Confidential Information" means:
(a) any and all information of Cabot of a confidential and/or
proprietary nature, including, but not limited to: technology;
inventions (whether or not patentable); trade secrets;
samples; compositions; techniques and equipment; methods;
manufacturing processes and processing conditions; engineering
data; drawings; specifications; formulae; plant design and
layout; products and product applications; development plans
and new business opportunities; experimental work; commercial
and developmental operations; the identities and requirements
of customers and prospective customers; customer lists;
suppliers and supplier lists; the identities of other
individuals or third parties with whom Cabot has or with which
is seeking to develop a business relationship and the nature
and details of any such relationship or potential
relationship; software and networks; business, marketing and
any other plans and strategies; sales, pricing, raw materials
and cost information; financial information; compensation,
benefits and related incentives; and any other information
relating to Cabot and its businesses; and,
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(b) any and all information received by Cabot from any customer or
other third party (e.g. supplier or business partner) of a
confidential and/or proprietary nature, including, but not
limited to: technology; inventions (whether or not
patentable); trade secrets; samples; compositions; performance
targets and criteria; techniques and equipment; methods;
manufacturing processes and processing conditions; engineering
data; drawings; specifications; plant design and layout;
products and product applications; development plans and new
business opportunities; experimental work; commercial and
developmental operations; customers and customer lists;
suppliers and supplier lists; software and networks; business
and marketing plans and strategies; pricing and costs
information; financial information; and any other information
relating to such customer or third party and its businesses.
8. In exchange for the payments provided to you under this Separation
Agreement, to which you acknowledge you would not otherwise be
entitled, and to protect the Confidential Information and other
legitimate business interests of Cabot, you agree that:
(a) for a period of eighteen (18) months following the Separation
Date, you will not directly or indirectly (either alone or in
association with any person, firm, corporation, or other
entity) work for or on behalf of, become an owner, partner or
investor in, consult with, or otherwise provide any services
to any third party in any area or activity that is competitive
with any business or research and development activity of
Cabot; and
(b) for a period of eighteen (18) months following the Separation
Date, you will not directly or indirectly (either alone or in
association with any person, firm, corporation, or other
entity) recruit, solicit, induce, or attempt to do the same,
any employee of Cabot or any of its subsidiaries or affiliates
to leave the employ of Cabot or any of its subsidiaries or
affiliates or otherwise cease to make his/her services
available to Cabot or any of its subsidiaries or affiliates.
9. You acknowledge that you have carefully read and considered all the
terms and conditions of this Separation Agreement, including the
restraints imposed upon you pursuant to paragraphs 7 and 8. You
understand and agree that these restraints are necessary for the
reasonable and proper protection of the legitimate business interests
of Cabot, and that a breach by you of any one of these restraints would
cause irreparable harm and damage to Cabot. You further acknowledge
that damages would not be an adequate remedy for a breach or threatened
breach by you of any one of the covenants contained in paragraphs 7 and
8. You therefore agree that Cabot shall be entitled to the enforcement
of this Separation Agreement by injunction, specific performance or
other equitable relief, without need of posting a bond and without
prejudice to any other rights and remedies that Cabot may have under
this Separation Agreement or under applicable law.
10. All inventions, discoveries and improvements conceived or made by you
during your employment with Cabot that (i) relate to the business or
activities of Cabot or (ii) were conceived or developed by you during
normal working hours or using Cabot's facilities shall belong to Cabot,
whether or not reduced to writing or practice during your employment
with Cabot. You hereby assign to Cabot or its nominee all your rights
and interest in any such
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inventions, discoveries and improvements and agree to keep protected
the interest of Cabot or its nominee in any such inventions,
discoveries and improvements. You are also assigning to Cabot or its
nominee, at Cabot's expense, all copyrights and reproduction rights to
any material prepared by you during your employment with Cabot that (i)
relate to the business activities of Cabot or (ii) were conceived or
developed by you during normal working hours or using Cabot's
facilities. If within the eighteen month period following the
Separation Date, you disclose to anyone or file a patent application
with respect to any invention, discovery or improvement relating to any
subject matter with which your work for Cabot was concerned, such
invention, discovery or improvement shall be presumed to have been made
by you during your employment with Cabot unless you can provide clear
and convincing evidence to the contrary.
11. It is agreed and understood that your right to receive and retain any
and all of the payments provided for in this Separation Agreement shall
be expressly conditioned on your continued and material performance of
your obligations under this Separation Agreement, including, but not
limited to, those obligations set forth in paragraphs 7 through 10.
12. For the two (2) year period following the Separation Date, you agree to
reasonably cooperate with the Company hereafter with respect to all
matters arising during or related to your employment with the Company,
including, but not limited to, all matters in connection with any
governmental investigation, litigation, arbitration or other proceeding
which may have arisen as of, or which may arise following, the
Separation Date, and the filing and prosecution of any patent
application(s) worldwide. Cabot will reimburse you your out-of-pocket
expenses incurred in complying with Company requests hereunder,
provided that such expenses are authorized by the Company in advance.
13. You agree that, except as required by law, you will not disclose this
Separation Agreement or any of its terms or provisions, directly or by
implication, except to your spouse, tax advisor, and an attorney with
whom you choose to consult regarding your consideration of this
Separation Agreement, and then only on condition that they agree not to
further disclose this Separation Agreement or any of its terms or
provisions to others.
14. You agree, except as required by law, not to make negative, disparaging
or derogatory comments to anyone about Cabot, its businesses (including
its subsidiaries, affiliates and successors), its management (including
without limitation its shareholders, officers and directors), its
employees and/or the products of any of the foregoing. You further
agree that you will not otherwise do or say anything associated with
your current role with Cabot that could disrupt the good morale of
Cabot's employees or harm Cabot's interests or reputation. The Company
agrees to instruct its current officers to not make any disparaging
remarks about you to any third parties inside or outside of the
Company.
15. You hereby represent and acknowledge that in executing this Separation
Agreement, you do not rely and have not relied upon any representation
or statement made by Cabot or by any agents, representatives or
attorneys of Cabot with regard to the subject matter, basis or effect
of this Separation Agreement. This Separation Agreement constitutes the
entire agreement between you and Cabot and replaces all prior and
contemporaneous agreements, communications and understandings, whether
written or oral, with respect to your
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employment at Cabot, its termination, confidentiality, non-competition,
non-solicitation, assignment of rights to intellectual property or the
like, and all related matters, other than any loans by Cabot to you.
16. This Separation Agreement may not be modified, altered or changed
except upon express written consent of both parties wherein specific
reference is made to this Separation Agreement.
17. The parties agree that neither this Separation Agreement nor the
furnishing of any consideration herein shall be deemed or construed at
anytime for any purposes as an admission by Cabot of any liability or
unlawful conduct of any kind.
18. You agree that any changes or modifications made to the terms of this
Separation Agreement, whether material or immaterial, do not restart or
affect in any manner the original twenty-one (21) calendar day
consideration period. You further agree that you have been given the
full period within which to consider the Separation Agreement and that
the twenty-one day period will end on or before January 26, 2006, and
that Cabot has advised you to consult with an attorney concerning this
Separation Agreement.
19. In signing this Separation Agreement, you represent and warrant that,
except as expressly provided below, you have returned to the Company
any and all non-public documents, materials and information (whether in
hardcopy, on electronic media or otherwise) related to Company business
(whether present or otherwise) and all keys, access cards, credit
cards, computer hardware and software, telephones and telephone-related
equipment and all other property of the Company in your possession or
control. Further, you represent and warrant that you have not retained
any copy of any non-public Company documents, materials or information
(whether in hardcopy, on electronic media or otherwise). Recognizing
that your employment with the Company has ended as of the Separation
Date, you agree that you will not, for any purpose, attempt to access
or use any Company computer or computer network or system, including
without limitation its electronic mail system, after such date.
Further, you acknowledge that you have disclosed to the Company all
passwords necessary or desirable to enable the Company to access all
information which you have password-protected on any of its computer
equipment or on its computer network or system.
Cabot agrees that you may retain the laptop computer provided to you by
the Company; provided, however, that, prior to and no later than
January 3, 2005, you shall make such laptop computer available to
Xxxxxx Xxxx (at Cabot Corporation, 0 Xxxxxxx Xxxx, Xxxxx 0000, Xxxxxx,
XX 02210-2019), so that Xx. Xxxx can make the necessary adjustments to
the computer to remove all Cabot-specific hardware and software and to
ensure compliance with the foregoing provisions and your ongoing
confidentiality obligations to the Company.
20. To the extent you choose to accept this offer and sign this Separation
Agreement, you shall have seven (7) days from the date upon which you
sign it to revoke your agreement. This Separation Agreement shall not
be effective and/or enforceable until your seven-day revocation period
has expired unexercised.
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If the terms of this Separation Agreement are acceptable to you, please
sign and return a copy of this letter to Xxxxx X. Xxxxx at Cabot Corporation,
Two Xxxxxxx Xxxx, Xxxxx 0000, Xxxxxx, XX 00000-0000, by January 26, 2006. If you
accept the foregoing offer, you shall have the right to revoke this Separation
Agreement by delivering or sending to Xx. Xxxxx (at Cabot Corporation, Two
Xxxxxxx Xxxx, Xxxxx 0000, Xxxxxx Xxxxxxxxxxxxx 02210-2019) written notice of
revocation so that your notice of revocation is received by Xx. Xxxxx within
seven calendar days after the date that this letter is signed by you. If you
revoke within this time period, this Separation Agreement shall be null and void
in its entirety and you will not be entitled to any additional payments and
benefits set forth in this Separation Agreement. Otherwise this Separation
Agreement shall be binding upon you, your heirs and representatives and shall
inure to the benefit of, and be binding upon, Cabot and its successors and
assigns.
Notwithstanding anything to the contrary, Cabot shall not be required
to make any payments or provide any other benefits to you pursuant to this
Separation Agreement unless and until your right of revocation has expired
unexercised. Any payments or benefits that would otherwise be due hereunder
prior to expiration of the revocation period shall be paid or provided by Cabot
within a reasonable time after your right of revocation has expired unexercised.
This Separation Agreement shall be treated as a contract under seal for purposes
of Massachusetts law.
Very truly yours,
CABOT CORPORATION
By /s/ Xxxxx X. Xxxxx
----------------------------
Xxxxx X. Xxxxx
Vice President
The foregoing offer by Cabot Corporation is accepted and agreed to this 4th day
January, 2006.
/s/ Xxxx X. Xxxx
------------------------------------
Xxxx X. Xxxx
COMMONWEALTH OF MASSACHUSETTS )ss.:
)
)
COUNTY OF SUFFOLK )
In this 4th day of January, 2006, before me, the undersigned notary
public, personally appeared the above-named Xxxx X. Xxxx, proved to me through
satisfactory evidence of
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identification, which were MA driver's license, to be the person whose name is
signed in the preceding document, and acknowledged to me that he signed it
voluntarily for its stated purpose.
/s/ Xxxxxxx X. Xxxxx
----------------------
Notary Public, Commonwealth of Massachusetts
Notary's name (printed): Xxxxxxx X. Xxxxx
----------------
Notary's commission expires: 9-13-07
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