1
EXHIBIT 10.28
AGREEMENT AND RELEASE
THIS AGREEMENT is made this 29th day of October, 1999, by and between
XXXXXXX X. XXXXXX (hereinafter "Xxxxxx") and AQUA-CHEM, INC., a Delaware
corporation (hereinafter the "Company").
WHEREAS, Xxxxxx is President and Chief Executive Officer of the
Company, and is resigning as an employee but will continue to serve as a
Director of the Company and as a Chairman of the Board of Directors of the
Company; and
WHEREAS, Xxxxxx and the Company desire to resolve certain matters
between them, including all aspects of the employment relationship between them,
provide for the payment of certain compensation to Xxxxxx after the Effective
Date, and reduce their agreement to writing.
NOW, THEREFORE, in consideration of the premises and the mutual
promises hereinafter set forth, the parties agree as follows:
1. RESIGNATION. Effective October 18, 1999 (the "Effective Date"),
except for the positions of Director and Chairman of the Board of Directors of
the Company, Xxxxxx voluntarily resigns as an officer and employee of the
Company and from any and all other positions held with the Company and its
subsidiaries. Xxxxxx shall be permitted to retain the Company-owned personal
computer and shall promptly return all Company credit cards and cellular phones
in his possession. The Employment Agreement between Xxxxxx and the Company,
dated July 31, 1997, as amended, is hereby terminated.
2. HEALTH AND LIFE INSURANCE PREMIUM PAYMENTS AND D&O COVERAGE.
Provided that Xxxxxx exercises his COBRA rights with respect to health
insurance, during the period from October 18, 1999, through October 17, 2000,
the Company will pay eighty percent (80%) of the premium for such health
insurance. From October 18, 1999, until the earlier of (1) October 17, 2000, or
(2) the date of the sale of substantially all of the assets or stock of the
Company or the adoption of a plan of providing for the complete liquidation of
the Company ( a "Disposition"), the Company will continue to pay the premium on
the $5,000,000 life insurance policy owned by The Xxxxxxx X. Xxxxxx Irrevocable
Trust u/a/d May 10,1997. For so long as Xxxxxx is a director of the Company, the
Company, at its expense, will continue to provide Xxxxxx with such directors and
officers liability insurance coverage as it provides to the Company's other
directors and officers.
3. NO OTHER LIABILITIES OR OBLIGATIONS. Xxxxxx hereby acknowledges and
agrees that the Company's sole remaining liabilities and/or obligations to him
consist of the following: (i) the obligation to pay consulting fees as
specifically set forth in the Consulting Agreement with X. Xxxxxx Management,
Inc., a Michigan Corporation wholly owned by Xxxxxx ("JMM") of
2
even date herewith (the "Consulting Agreement"); (ii) the obligations with
respect to insurance matters as specifically set forth in Section 2 above; (iii)
the vested benefits, if any, Xxxxxx may have under the specific terms of the
Company's qualified retirement plans, and (iv) the obligation to pay expense
reimbursement requests recently submitted by Xxxxxx to the Company under the
Company's standard reimbursement policies and procedures in an aggregate amount
not to exceed $10,000 (collectively, the "Sole Remaining Obligations"). Apart
from the Sole Remaining Obligations, Xxxxxx hereby further acknowledges and
agrees as follows: (i) he is not entitled to receive any other compensation,
benefits or reimbursements of any kind or nature whatsoever from the Company,
including but not limited to vacation or sick pay, bonuses, stock options, club
memberships, other incentive compensation or reimbursements for any expenses
(including without limitation legal fees for any services performed through the
date of this Agreement and Release), and (ii) all options previously granted to
Xxxxxx under any Company stock option plan have terminated and are null and void
and not exercisable.
4. RELEASE BY XXXXXX. In consideration of the Company's agreement to
provide the benefits described in Section 2 above, the Company's entering into
the Consulting Agreement and other good and valuable consideration received from
the Company, the receipt of which is hereby acknowledged, Xxxxxx, an adult
individual, for himself, his heirs, personal representatives, administrators,
successors, assigns or any persons or entities affiliated with him or subject to
his control, does hereby unconditionally and forever remise, release and
discharge the Company and all of its past, present and future successors,
predecessors, subsidiaries, affiliates, assigns, officers, stockholders,
directors, partners, employees, co-investors, financial advisors, attorneys,
representatives, agents, and any other person or entity acting for or on behalf
of the Company (collectively the "Released Company Parties") from all actions,
causes of action, suits, debts, dues, sums of money, accounts, reckonings,
bonds, bills, specialties, covenants, contracts, controversies, agreements,
promises, damages, judgments, executions, claims, rights, obligations, losses,
liabilities, costs, expenses, attorneys' fees, and demands whatsoever, whether
known or unknown, contingent or absolute, suspected or unsuspected, disclosed or
undisclosed, material or immaterial, whether individual, class, derivative or
representative, whether in law or equity, or of any other type or in any other
capacity, which against the Released Company Parties, Xxxxxx, Xxxxxx'x heirs,
executors, personal representatives, administrators, successors and assigns,
past, present, or future ever had, now have or hereafter can, shall or may, have
for, upon, or by reason of any matter, cause or thing whatsoever from the
beginning of the world to the day of the date of this Agreement, whether based
on tort, express or implied contract, or any federal, state or local law,
statute or regulation, or otherwise specifically including but not limited to
(i) any and all claims arising out of or related to any employment or any other
agreement (whether oral or written) between him and the Company, and (ii) any
and all claims arising out of or related to his employment with the Company,
including but not limited to claims under the Wisconsin Family and Medical Leave
Act, the Federal Family and Medical Leave Act, the Wisconsin Fair Employment
Act, Title VII of the Civil Rights Act of 1964, as amended, the Age
Discrimination in Employment Act of 1967, as amended, the Americans With
Disabilities Act, the Civil Rights Act of 1991, and the Employee Retirement
Income Security Act, as amended.
2
3
Nothing in the waiver or release set forth in this subsection shall be construed
to constitute any waiver or release by Xxxxxx of any rights or claims under this
Agreement.
5. AGREEMENT BY XXXXXX NOT TO XXX. To the extent permitted by law,
Xxxxxx agrees not to initiate or cause to be initiated on behalf of himself or
any other person any federal, state or local lawsuit or any federal, state or
local administrative action, investigation or proceeding of any kind against the
Released Company Parties, or any of them, based on any transaction, matter,
cause or thing occurring prior to or on the date of this Agreement.
6. RELEASE BY THE COMPANY. In consideration of Xxxxxx'x undertakings as
set forth herein and other good and valuable consideration received from Xxxxxx,
the receipt of which is hereby acknowledged, the Company, for itself, its
affiliates, successors and assigns or any persons or entities under his control,
does hereby unconditionally and forever remise, release and discharge Xxxxxx and
his heirs, personal representatives, administrators, financial advisors,
attorneys, representatives, agents, and any other person or entity acting for or
on behalf of him (collectively the "Released Xxxxxx Parties") from all actions,
claims, causes of action, suits, obligations, losses, liabilities, costs,
expenses, attorneys' fees, and demands whatsoever, whether known or unknown,
contingent or absolute, whether in law or equity, or of any other type or in any
other capacity which it has had, now has or may have against him with respect to
the matters specifically identified and disclosed in the materials prepared and
submitted by Xxxxxx to the Company on October 8, 1999, copies of which have been
initialed by the parties. Nothing in the waiver or release set forth in this
subsection shall be construed to constitute any waiver or release by the Company
of any other rights or claims or any rights or claims under this Agreement.
7. AGREEMENT BY THE COMPANY NOT TO XXX. To the extent permitted by law,
the Company agrees not to initiate or cause to be initiated on behalf of itself
or any other person any federal, state or local lawsuit or any federal, state or
local administrative action, investigation or proceeding of any kind against the
Released Xxxxxx Parties, or any of them, based on any matter within the scope of
the release set forth in Section 6 above.
8. WAIVER OF EMPLOYMENT. Xxxxxx waives any right to past, present
or future employment with the Company or any affiliated entity, and Xxxxxx
agrees not to apply for or otherwise seek employment at any time in the future
with the Company or any affiliated entity.
9. NO ADMISSION OF LIABILITY. It is understood and agreed this
Agreement is intended to provide for the matter of the amicable resignation of
Xxxxxx and the cancellation of his Employment Agreement and that neither this
Agreement nor the furnishing of the consideration provided for in this Agreement
shall be deemed or construed at any time or for any purpose as an admission of
liability by any of the parties. Liability for any and all claims for relief is
expressly denied by the parties.
3
4
10. NONDISCLOSURE. Except as required by law, the parties agree not to
disclose the terms of this Agreement to any person or entity, other than their
respective attorney or accountant without the written consent of the other
party.
11. ACKNOWLEDGMENT. Xxxxxx hereby acknowledges and agrees that the
payments and concessions of the Company under this Agreement are adequate
consideration. Xxxxxx further acknowledges that he has been advised in writing
by the Company to consult with an attorney prior to executing this Agreement,
and he has also been advised in writing by the Company that he has at least
twenty-one (21) days within which to consider this Agreement.
12. GOVERNING LAW AND FORUM. This Agreement shall be governed by and
construed under the laws of the State of Wisconsin, and any dispute arising out
of or relating to this Agreement shall be brought in a court of competent
jurisdiction in Milwaukee County, Wisconsin.
13. VOLUNTARY AGREEMENT. Xxxxxx hereby acknowledges and agrees that he
has been afforded ample opportunity to consider this Agreement and enters into
this Agreement freely, knowingly and without coercion and not in reliance upon
any representations or promises made by the Company or its counsel or the
Released Company Parties, other than those contained herein.
14. HEADINGS. The headings of the sections contained in this Agreement
are for convenience only and shall not be deemed to control or affect the
meaning or construction of any provision of this Agreement.
15. COUNTERPARTS. This Agreement may be signed in counterparts, with
the same effect as if the signatures were upon the same instrument.
16. BINDING AGREEMENT. This Agreement shall be binding upon and inure
to the benefit of Xxxxxx'x personal or legal representatives and heirs and shall
be binding upon and inure to the benefit of the Company's successors and
assigns.
17. ENTIRE AGREEMENT. Except for (i) those written agreements (other
than Xxxxxx'x employment agreement, which is being terminated pursuant to this
Agreement) entered into on July 31, 1997 among Xxxxxx, the Company and
affiliates, (ii) the standard director Indemnity Agreement between Xxxxxx and
the Company, and (iii) the Consulting Agreement of even date herewith this
Agreement supersedes all other agreements or understandings (whether oral or
written) between Xxxxxx and the Company and constitutes the entire agreement of
the parties.
18. MODIFICATIONS, AMENDMENTS, ETC. This Agreement shall not be deemed
or construed to have been modified, amended, rescinded, canceled or waived, in
whole or in part, except by written instrument signed by the parties hereto.
4
5
19. NOTICE, RIGHT TO REVOKE. Xxxxxx hereby acknowledges and agrees that
he has been given twenty-one (21) days by the Company to review and consider
this agreement with his independent counsel and has voluntarily waived such
notice period or any other notice period required by law. For a period of seven
(7) days following the execution of this Agreement, Xxxxxx may revoke this
Agreement, and the Agreement shall not become effective or enforceable until
this seven (7) day revocation period has expired.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first set forth above.
AQUA-CHEM, INC.
By: /s/ Xxxxx X. Xxxxxxxxxx /s/ Xxxxxxx X. Xxxxxx
----------------------------- -------------------------------
Xxxxxxx X. Xxxxxx
5
6
CONSULTING AGREEMENT
AGREEMENT, made and entered into as of the 18th day of October, 1999
(the "Effective Date"), by and among, Aqua-Chem, Inc., a Delaware company (the
"Company"), X. Xxxxxx Management, Inc., a Michigan corporation ("JMM") and
Xxxxxxx X. Xxxxxx ("Xxxxxx").
WHEREAS, Xxxxxx has served as President and Chief Executive Officer of
the Company and, simultaneous with the execution of this Agreement, is resigning
from such positions; and
WHEREAS, the Board of Directors desires Xxxxxx to provide ongoing
consulting services to the Company and Xxxxxx desires to do so through his
independent consulting firm, JMM.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements hereinafter set forth, the Company, Xxxxxx and JMM hereby agree as
follows:
1. CONSULTING SERVICES. Following the Effective Date and continuing
until the earlier of (i) October 17, 2001, or (ii) the sale of substantially all
of the assets or stock of the Company or the adoption of a plan of providing for
the complete liquidation of the Company (hereinafter respectively referred to as
a "Disposition" and the "Consulting Period"), JMM shall provide consulting
services to the Company on an as needed basis. Such consulting services shall be
performed by Xxxxxx personally and provided at mutually agreeable times and
places so as to not unreasonably interfere with other JMM engagements. JMM shall
be responsible for all expenses incurred in providing consulting services except
travel expenses incurred at the request of the Company, which shall be
reimbursed in accordance with the Company's policies, applicable to all
employees, as in effect from time to time. After the Effective Date the Company
shall no longer provide JMM or Xxxxxx with an office, but shall continue to
provide E-mail and voice mail support. As part of the consulting arrangement,
JMM and Xxxxxx agree to cooperate with the Company to transfer Xxxxxx'x
responsibilities and duties as president and CEO to his successor. Xxxxxx'x
duties as a consultant shall not preclude his providing services to others,
provided that the performance of such services does not violate the restrictions
hereinafter set forth in this Agreement.
2. CONSULTING FEES AND RELATED MATTERS. Subject to Xxxxxx not
exercising his revocation right with respect to the Agreement and Release dated
October 29, 1999, the Company agrees to pay the consulting fees hereinafter set
forth. During the period from October 18, 1999, through October 17, 2000, the
Company will pay JMM a consulting fee at the annual rate of $498,750 per year.
Except as set forth in the preceding sentence, this first year consulting fee
shall not be subject to any future Board approvals or contingencies and shall be
paid in full irrespective of a Disposition. From October 18, 2000, until the
earlier of (1) October 17, 2001, or (2) the date of a Disposition, the Company
will pay JMM a consulting fee at the annual rate of $200,000 per year. In the
event of a Disposition after October 17, 2000, the consulting fee shall
6
7
be pro-rated to the date of Disposition. Said consulting fees shall be paid in
bi-weekly installments (pro-rated for the first and final month). It is hereby
acknowledged and agreed by all parties that from and after the Effective Date
Xxxxxx is an employee of JMM and not an employee of the Company and JMM shall be
solely responsible for any and all taxes on any nature whatsoever relating to
the consulting fees. Xxxxxx and JMM hereby jointly and severally agree to
forever indemnify and hold harmless the Company and its affiliates from any and
all liabilities (including reasonable attorney's fees) for any tax, interest
and/or penalties in any manner relating or attributable to the consulting fees.
3. RESTRICTIONS. (a) JMM and Xxxxxx acknowledge and agree that the
Company's business is by its nature international, the Company's business and
customer contacts have been established and maintained at great expense, Xxxxxx,
by virtue of his position with the Company, has and will continue to be privy to
the Company's most confidential business plans and strategies which, without the
restrictions hereinafter set forth, would enable Xxxxxx and/or JMM to compete
unfairly with the Company and, accordingly, such restrictions are reasonable and
necessary to protect the legitimate interests of the Company. Xxxxxx and JMM
hereby jointly and severally covenant and agree that neither Xxxxxx nor JMM will
at any time subsequent to the date hereof, reveal, divulge, or make known to any
Person any Confidential Information (as hereinafter defined) made known to
Xxxxxx or JMM or of which Xxxxxx or JMM become aware, regardless of whether
developed, prepared, devised or otherwise created in whole or in part by the
efforts of Xxxxxx or JMM and except to the extent so authorized in writing by
the Company in order to carry out the terms of this Agreement or except as
required by law. For purposes of this Agreement, the term "Confidential
Information" shall mean (i) any technical, scientific or engineering information
relating to the Company's products and/or services, (ii) information relating to
any customer of the Company, including without limitation, the names, addresses,
telephone numbers and sales records of, or pertaining to any such customer, and
(iii) price lists, methods of operation, financial data, business and/or
strategic plans and/or other information pertaining to the Company which the
Company has treated as confidential or protected as a trade secret.
Notwithstanding anything contained herein to the contrary, Confidential
Information as used herein shall not include that which (i) is or becomes
generally available to the public other than as a result of a disclosure by
Xxxxxx or JMM or its affiliates or representatives, (ii) was available to Xxxxxx
or JMM prior to its disclosure to Xxxxxx or JMM by the Company or its
representatives, or (iii) becomes available to Xxxxxx or JMM from a source other
than the Company or its representatives, provided that such source is not bound
by a confidentiality agreement with the Company or its representatives.
(b) Xxxxxx and JMM hereby jointly and severally covenant and
agree that at no time during the Consulting Period, will either Xxxxxx or JMM
directly or indirectly in any capacity whatsoever (whether as an employee,
officer, director, consultant, partner, member, joint venturer, agent,
representative or otherwise) provide service, advice or assistance of any nature
to, or acquire an ownership interest in (or acquire the right to acquire an
ownership interest in a Competing Business (as hereinafter defined). A
"Competing Business" shall mean and be limited to any business, regardless of
the form of organization, which (1) is engaged in
7
8
the design, manufacture and/or sale of products which are similar in design or
function to or otherwise compete with the products which were under design by
the Company or included in the Company's product lines during the Consulting
Period (hereinafter referred to as "Competing Products") and which also (ii)
sells, attempts to sell or markets such Competing Products within the United
States and/or any foreign country within which, during the Consulting Period the
Company sold any of its products (or was a party to an executory contract for
the sale of any of its products), attempted to sell, or marketed any of its
products other than by means of general advertising. Notwithstanding the
preceding, neither Xxxxxx nor JMM shall be prohibited from (1) acquiring less
than five percent (5%) of the stock of any publicly traded company; or (2)
providing services to a company that, among it businesses, is engaged in a
Competing Business, provided that Xxxxxx is not personally directly or
indirectly involved in any capacity whatsoever in such Competing Business.
(c) During the Consulting Period, neither Xxxxxx nor JMM shall
directly or indirectly, on behalf of either of them or any other person, entity,
or business, employ or engage the services of any person employed by the Company
or any agent who represents the Company during the Consulting Period, or
otherwise encourage or entice any such person to terminate or diminish their
relationship with the Company.
(d) Xxxxxx and JMM hereby acknowledge and agree (i) Xxxxxx'x
education and experience are such that the foregoing restrictions will not
unduly interfere with his ability to earn a livelihood, (ii) the Company would
suffer irreparable harm in the event of a violation of such restrictions, and
(iii) accordingly, in addition to any other remedies available to it, the
Company shall be entitled to injunctive relief, without the posting of bond or
other collateral. All costs, including reasonable attorneys' fees, incurred in
enforcing this provision shall be reimbursed to the prevailing party.
(e) If any court shall determine that the duration or any
other aspect of the Restrictions is unenforceable, it is the intention of the
parties that the Restrictions shall not thereby be terminated, but shall be
deemed amended to the extent required to render them valid and enforceable, such
amendment to apply only with respect to the operation of this paragraph in the
jurisdiction of the court which has made such adjudication.
(f) This Agreement shall be deemed to be severable, and any
part hereof which may be held invalid by a court of competent jurisdiction shall
be deemed to be excluded from this Agreement, and the remaining parts shall
remain in full force and effect; provided, however, that should any aspect of
the Restrictions be held to be unenforceable as a result of the challenging of
same by Xxxxxx or JMM, then Xxxxxx and JMM shall immediately repay to the
Company any consulting fees paid to JMM, and the Company shall have no further
obligation whatsoever to make any payments pursuant to the terms of this
Agreement.
8
9
(g) The parties acknowledge and agree that breach of the
Restrictions would cause irreparable damage to the Company and that monetary
damages alone would not provide the Company with an adequate remedy. Therefore,
if any controversy arises concerning the Restrictions, such Restrictions shall
be specifically enforced by injunction, without any requirement for the posting
of any bond or other collateral. Such remedy, however, shall be cumulative and
non-exclusive, and the Company shall be entitled to any other remedy provided by
law, including monetary damages.
(h) The parties agree that nothing in this Agreement should be
construed to limit or negate the common law of torts or trade secrets where it
provides the parties with broader protection than that provided herein.
4. MISCELLANEOUS. This Agreement shall be governed by and construed
under the laws of the State of Wisconsin, and any dispute arising out of or
relating to this Agreement shall be brought in a court of competent jurisdiction
in Milwaukee County, Wisconsin. The headings of the sections contained in this
Agreement are for convenience only and shall not be deemed to control or affect
the meaning or construction of any provision of this Agreement. This Agreement
may be signed in counterparts, with the same effect as if the signatures were
upon the same instrument. This Agreement shall be binding upon and inure to the
benefit of Xxxxxx'x personal or legal representatives and heirs and shall be
binding upon and inure to the benefit of the Company's successors and assigns.
This Agreement shall not be deemed or construed to have been modified, amended,
rescinded, canceled or waived, in whole or in part, except by written instrument
signed by the parties hereto. This Agreement supersedes all other agreements or
understandings (whether oral or written) between Xxxxxx and the Company with
respect to the subject matter herein and constitutes the entire agreement of the
parties with respect to the same.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first set forth above.
Aqua-Chem, Inc.
By: /s/ Xxxxx X. Xxxxxxxxxx
------------------------
X. Xxxxxx Management, Inc.
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------
/s/ Xxxxxxx X. Xxxxxx
---------------------------
Xxxxxxx X. Xxxxxx
9
