Exhibit 10.11
SEPARATION AGREEMENT
SEPARATION AGREEMENT (the "Agreement"), made and entered into as of July
31, 2004 and effective as of July 1, 2004 (the "Effective Date"), by and between
▇▇▇▇▇▇ International, Inc., a Delaware corporation (the "Company"), and
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ (the "Employee").
W I T N E S S E T H:
WHEREAS, the Employee has served as Chief Financial Officer of the Company
pursuant to an employment offer letter, dated December 21, 2001 (the "Offer
Letter"), that provides for payment of severance upon a termination of
employment with the Company;
WHEREAS, the Employee and the Company have entered into a Severance
Agreement, dated as of February 26, 2004 (the "Severance Agreement") that
provides for payment of severance upon a termination of employment in connection
with a change in control (as defined in the Severance Agreement);
WHEREAS, the Company and the Employee have mutually agreed that the
Employee will resign from his employment as of the Effective Date;
WHEREAS, the parties hereto desire to enter into this Agreement in order to
settle fully and finally all matters between them, including but not limited to
any matters arising out of Employee's employment with the Company and his
separation therefrom; and
NOW THEREFORE, in consideration of the premises and mutual covenants
contained herein and for other good and valuable consideration, the receipt of
which is mutually acknowledged, the Company and the Employee agree as follows:
1. PRIOR AGREEMENTS.
Effective as of the Effective Date, the Employee's benefits upon a
termination of employment shall be governed by this Agreement, which restates
and supersedes the Offer Letter and the Severance Agreement. For the avoidance
of doubt, as of the Effective Date, the Offer Letter and the Severance Agreement
shall be of no further force and effect, and this Agreement shall constitute the
full and final understanding of the parties relating to severance benefits upon
termination of Employee's employment with the Company.
2. RESIGNATION.
Effective as of the Effective Date, the Employee hereby resigns from his
employment with the Company and his position as an officer and a member of the
board of directors of the Company (the "Board"). Except as provided herein, the
Employee shall no longer be entitled to any compensation or benefits in respect
of his services as an employee of the Company or a member of the Board.
3. PAYMENTS IN CONNECTION WITH RESIGNATION.
(a) In connection with the Employee's resignation, the Employee shall be
entitled to receive the following payments and benefits:
(i) payment of accrued but unpaid Base Salary and fees as a
member of the Board and reimbursement of proper business expenses and
expenses incurred in connection with his position as a member of the Board,
in each case, in accordance with Company policy;
(ii) subject to paragraph (b) below and Section 6(b) hereof,
continued medical,(1) hospitalization and basic life insurance coverage for
a period ending on June 30, 2005 or such earlier date as the Employee
obtains comparable medical, hospitalization or life insurance coverage (as
the case may be) from any other employer;
(iii) subject to paragraph (b) below and Section 6(b) hereof, a
cash payment equal to (A) one year of the Employee's base salary as in
effect immediately prior to the Effective Date, such amount to be paid, in
the sole discretion of the Company, either in a lump sum within five (5)
business days following the Release Effective Date (as hereinafter
defined), or in equal monthly installments in accordance with Company
payroll practices, plus (B) the Employee's bonus for fiscal year 2004 under
the Management Incentive Plan, such amount to be paid at such time as
employee bonuses under the Management Incentive Plan are paid to other
participants in such plan; and
(iv) subject to paragraph (b) below and Section 6(b) hereof, a
payment of twelve thousand dollars ($12,000) (net of taxes, if applicable)
to be paid by the Company in a lump sum payment within five (5) days of the
Effective Date; such amount to be used at Employee's discretion for
outplacement career counseling and job search costs.
(b) RELEASE. As a condition of the Employee's entitlement to any of the
payments and benefits provided in clauses (ii), (iii) and (iv) of paragraph (a)
above, the Employee shall execute on the Effective Date and shall not have
revoked prior to the Release Effective Date (as hereinafter defined) a release
of claims against the Company substantially in the form attached hereto as
EXHIBIT A (the "Release"). Employee acknowledges that he has been advised in
writing to consult with an attorney prior to executing the Release. Employee and
Company agree that Employee has a period of seven (7) days following the
execution of the Release within which to revoke the Release. The parties also
acknowledge and agree that the Release shall not be effective or enforceable
until the seven (7) day revocation period expires. The date on which this seven
(7) day period expires shall be the effective date of the Release (the "Release
Effective Date"). Except as specifically provided in Section 3(a) or required
under applicable law, Employee will not be eligible to receive any salary, bonus
or other compensation described in Section 3(a) with respect to any future
periods after the Effective Date; provided, however, Employee shall have the
right to receive all compensation that he is entitled under any benefit
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(1) Participation in the Company's Medical Plan will be at the same level of
current participation. The value of the benefit will be calculated based upon
average cost per participant in the plan. The difference between the premium
paid by the individual and the value of the benefit will be counted as imputed
income. This amount will be "grossed up" for compensation purposes. A
recalculation of average cost will be effective on January 1, 2005.
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plans of Company to the extent he is fully vested as of the Effective Date
pursuant to the terms and conditions of such employee benefit plans.
4. CONFIDENTIALITY. For purposes of this Section 4, the term "Company"
shall include, in addition to Company, its affiliates, subsidiaries and any of
their respective predecessors, successors and assigns.
(a) CONFIDENTIAL INFORMATION. As used in this Agreement, "Confidential
Information" means any and all confidential, proprietary or other information,
whether or not originated by Employee or Company, which is in any way related to
the past or present Company's Business (as defined below) and is either
designated as confidential or not generally known by or available to the public.
Confidential Information includes, but is not limited to (whether or not reduced
to writing or designated as confidential) (i) information regarding Company's
existing and potential customers and vendors; (ii) any contacts (including the
existence and contents thereof and parties thereto) to which Company is a party
or is bound; (iii) information regarding products and services being purchased
or leased by or provided to Company; (iv) information received by Company from
third parties under an obligation of confidentiality, restricted, disclosure or
restricted use; (v) personnel and financial information of Company; (vi)
information with respect to Company's products, services, facilities, business
methods, systems, trade secrets, technical know-how, and other intellectual
property; (vii) marketing and developmental plans and techniques, price and cost
data, forecasts and forecast assumptions, and potential strategies of Company;
and (viii) any other information relating to Company which was obtained by
Employee in connection with his employment by Company, whether before, on or
after the Effective Date.
(b) NON-DISCLOSURE AND NON-USE OF CONFIDENTIAL INFORMATION. Employee
acknowledges that the Confidential Information of Company is a valuable, unique
asset of Company and Employee's unauthorized use or disclosure thereof could
cause irreparable harm to Company for which no remedy at law could be adequate.
Accordingly, Employee agrees that he shall hold all Confidential Information of
Company in strict confidence and solely for the benefit of Company, and that he
shall not, directly or indirectly, disclose or use or authorize any third party
to disclose or use any Confidential Information, except (i) with the express
written consent of Company, (ii) to the extent that any such information is in
or becomes in the public domain other than as a result of Employee's breach of
any of his obligations hereunder, or (iii) where required to be disclosed by
court order, subpoena or other government process and in such event, Employee
shall cooperate with Company in attempting to keep such information
confidential. The Company shall reimburse Employee for all reasonable expenses
and costs he may incur as a result of cooperating under this Section 4(b), upon
receipt of proper documentation.
(c) OWNERSHIP OF CONFIDENTIAL INFORMATION. Employee acknowledges and
agrees that all Confidential Information is and shall remain the exclusive
property of Company, whether or not prepared in whole or in part by Employee and
whether or not disclosed to or entrusted to the custody of Employee. Employee
has delivered to Company all documents, tapes, disks, or other storage media and
any other materials, and all copies thereof in whatever form, in the possession
of Employee pertaining to the Company's Business, including, but not limited to,
any containing Confidential Information.
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(d) SURVIVAL. Employee's obligations set forth in this Section 4, and
Company's rights and remedies with respect hereto, shall survive indefinitely
following the Effective Date.
5. RESTRICTIVE COVENANTS.
For purposes of this Section 5, the term "Company" shall include, in
addition to Company, its affiliates, subsidiaries and any of their respective
predecessors, successors and assigns.
(a) NON-COMPETITION. During the Restricted Period and within the
Restricted Area (each as defined in subsection (d) below), Employee shall not,
directly or indirectly, perform on behalf of any Competitor (as defined in
subsection (d) below) the same or similar services as those that Employee
performed for Company during Employee's employment by Company or otherwise. In
addition, Employee shall not, during the Restricted Period or within the
Restricted Area, directly or indirectly engage in, own, manage, operate, join,
control, lend money or other assistance to, or participate in or be connected
with (as an officer, director, member, manager, partner, shareholder,
consultant, employee, agent, or otherwise), any Competitor.
(b) NON-SOLICITATION. During the Restricted Period, Employee shall not,
directly or indirectly, for himself or on behalf of any Person (as defined in
subsection (d) below), (i) solicit or attempt to solicit any Customers (as
defined in subsection (d) below) or prospective Customers with whom Employee had
contact at any time during Employee's employment by Company; (ii) divert or
attempt to divert any business of Company to any other Person; (iii) solicit or
attempt to solicit for employment, endeavor to entice away from Company,
recruit, hire, or otherwise interfere with Company's relationship with, any
Person who is employed by or otherwise engaged to perform services for Company
(or was employed or otherwise engaged to perform services for Company, as of any
given time, within the immediately preceding twelve (12) month period); (iv)
cause or assist, or attempt to cause or assist, any employee or other service
provider to leave Company; or (v) otherwise interfere in any manner with the
employment or business relationships of Company or the business or operations
then being conducted by Company.
(c) NON-DISPARAGEMENT. Employee shall not for all time following the
Effective Date make any statement, either written or oral, regarding the
Company, or any of its agents, subsidiaries, affiliates, related entities,
directors, officers, servants or employees, which is disparaging to the Company,
or its agents, subsidiaries, affiliates, related entities, directors, officers,
servants or employees, or which has a tendency to harm their reputation by
lowering them in the estimation of the community or deterring others from
associating or dealing with them. The Company agrees that its officers,
directors or management employees shall not for all time following the Effective
Date make any such disparaging statements referenced above, either written or
oral, pertaining to the Employee. Notwithstanding the foregoing, nothing, in
this Section 5(c) shall prohibit any person from making truthful statements when
required by order of a court or other body having jurisdiction, or as may
otherwise be required by law or legal process.
(d) DEFINITIONS. For purposes of Section 4 and Section 5 hereof, the
following definitions have the following meanings:
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(i) "Company's Business" means the business of developing,
manufacturing, selling or distributing high-performance alloys for service
in severe corrosion and high temperature applications.
(ii) "Competitor" means any Person that engages in a business
that is the same as, or similar to, the Company's Business.
(iii) "Customer" means any Person which, as of any given date,
used or purchased or contracted to use or purchase any services or products
from Company within the immediately preceding twelve (12) month period.
(iv) "Person" means any individual, corporation, partnership,
joint venture, association, limited liability company, joint-stock company,
trust, or unincorporated organization, or any governmental agency, officer,
department, commission, board, bureau, or instrumentality thereof.
(v) "Restricted Area" means, because the market for Company's
Business is global, or has the potential of being global, and is not
dependent upon the physical location or presence of the Company, Employee,
or any individual or entity that may be in violation of this Agreement, the
broadest geographic region enforceable by law (excluding any location where
this type of restriction is prohibited by law) as follows: (A) everywhere
in the world that has access to Company's Business because of the
availability of the Internet; (B) everywhere in the world that Employee has
the ability to compete with Company's Business through the Internet; (C)
each state, commonwealth, territory, province and other political
subdivision located in North America; (D) each state, commonwealth,
territory and other political subdivision of the United States of America;
(E) Indiana and any state in which Employee has performed any services for
Company; (F) any geographical area in which Company has performed any
services or sold any products; (G) any geographical area in which Company
or any of its subsidiaries have engaged in the Company's Business, which
has resulted in aggregate sales revenues of at least $25,000 during any
year in the five (5) year period immediately preceding the commencement of
the Restricted Period; (H) any state or other jurisdiction where Company
had an office at any time during Employee's employment by Company; (1)
within one hundred (100) miles of any location in which Company had an
office at any time during Employee's employment by Company; and (J) within
one hundred (100) miles of any location in which Employee provided services
for Company.
(vi) "Restricted Period" means the period commencing as of the
Effective Date through the first (1St) anniversary of the Effective Date.
In the event of a breach of this Agreement by Employee, the Restricted
Period will be extended automatically by the period of the breach.
(e) SURVIVAL. Employee's obligations set forth in this Section 5, and
Company's rights and remedies with respect thereto, will remain in full force
and effect during the Restricted Period and until full resolution of any dispute
related to the performance of Employee's obligations during the Restricted
Period.
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(f) PUBLIC COMPANY EXCEPTION. The prohibitions contained in Sections 4
and 5 do not prohibit Employee's ownership of stock which is publicly traded,
provided that (1) the investment is passive, (2) Employee has no other
involvement with the company, (3) Employee's interest is less than five (5%)
percent of the shares of the company, and (4) Employee makes full disclosure to
Company of the stock at the time that Employee acquires the shares of stock.
6. GENERAL.
(a) REASONABLENESS. Employee has carefully considered the nature, extent
and duration of the restrictions and obligations contained in this Agreement,
including, without limitation, the geographical coverage contained in Section 5,
the time periods contained in SECTION 4 and SECTION 5, and acknowledges and
agrees that such restrictions are fair and reasonable in all respects to protect
the legitimate interests of Company and that these restrictions are designed for
the reasonable protection of Company's Business.
(b) COOPERATION. Following the Effective Date, upon request of the Chief
Executive Officer of the Company, Employee shall make himself available to the
Company at mutually convenient times and places to assist the Company with
respect to Company-related matters, including but not limited to pending and
future litigations, arbitrations, governmental investigations or other dispute
resolutions relating to matters that arose during Employee's employment with the
Company. The Company shall reimburse Employee for all reasonable expenses and
costs he may incur as a result of providing assistance under this Section 6(b),
upon receipt of proper documentation.
(c) REMEDIES. Employee recognizes that any breach of this Agreement
shall cause irreparable injury to Company, inadequately compensable in monetary
damages. Accordingly, in addition to any other legal or equitable remedies that
may be available to Company, Employee agrees that Company shall be able to seek
and obtain injunctive relief in the form of a temporary restraining order,
preliminary injunction, or permanent injunction, in each case without notice or
bond, against Employee to enforce this Agreement. Company shall not be required
to demonstrate actual injury or damage to obtain injunctive relief from the
courts. To the extent that any damages are calculable resulting from the breach
of this Agreement, Company shall also be entitled to recover damages, including,
but not limited to, any lost profits of Company and/or its affiliates or
subsidiaries. For purposes of this Agreement, lost profits of Company shall be
deemed to include all gross revenues resulting from any activity of Employee in
violation of this Agreement and all such revenues shall be held in trust for the
benefit of Company. Any recovery of damages by Company shall be in addition to
and not in lieu of the injunctive relief to which Company is entitled. In no
event will a damage recovery be considered a penalty in liquidated damages. In
addition, in any action at law or in equity arising out of this Agreement, the
prevailing party shall be entitled to recover, in addition to any, damages
caused by a breach of this Agreement, all costs and expenses, including, but not
limited to, reasonable attorneys' fees, expenses, and court costs incurred by
such party in connection with such action or proceeding. Without limiting
Company's rights under this SECTION 6(c) or any other remedies of Company, if a
court of competent jurisdiction determines that Employee breached any of the
provisions of SECTIONS 4 OR 5, Company shall have the right to cease making any
payments or providing any benefits otherwise due to the Employee under the terms
and conditions of this Agreement.
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(d) CLAIMS BY EMPLOYEE. Employee acknowledges and agrees that any claim
or cause of action by Employee against Company shall not constitute a defense to
the enforcement of the restrictions and covenants set forth in this Agreement
and shall not be used to prohibit injunctive relief.
(e) AMENDMENTS. This Agreement may not be modified, amended, or waived
in any manner except by an instrument in writing signed by both parties to this
Agreement.
(f) WAIVER. The waiver by either party of compliance by the other party
with any provision of this Agreement shall not operate or be construed as a
waiver of any other provision of this Agreement (whether or not similar), or a
continuing waiver, or a waiver of any subsequent breach by a party of any
provision of this Agreement.
(g) GOVERNING LAW; JURISDICTION. The laws of the State of Indiana shall
govern the validity, performance, enforcement, interpretation, and other aspects
of this Agreement, notwithstanding any state's choice of law provisions to the
contrary. The parties intend the provisions of this Agreement to supplement, but
not displace, their respective obligations and responsibilities under the
Indiana Uniform Trade Secrets Act. Any proceeding to enforce, interpret,
challenge the validity of, or recover for the breach of any provision of, this
Agreement may be filed in the courts of the State of Indiana or the United
States District Court sitting in Indianapolis, Indiana, and the parties hereto
expressly waive any and all objections to personal jurisdiction, service of
processor venue in connection therewith.
(h) COMPLETE AGREEMENT. This Agreement constitutes a complete and total
integration of the understanding of the parties with respect to the subject
matter hereof and thereof and supersedes all prior or contemporaneous
negotiations, commitments, agreements, writings, and discussions with respect to
the subject matter of this Agreement, including but not limited to the Severance
Agreement and the Offer Letter.
(i) SEVERABILITY. If a court having proper jurisdiction holds a
particular provision of this Agreement unenforceable or invalid for any reason,
that provision shall be modified only to the extent necessary in the opinion of
such court to make it enforceable and valid and the remainder of this Agreement
shall be deemed valid and enforceable and shall be enforced to the greatest
extent possible under the then existing law. In the event the court determines
such modification is, not possible, the provision shall be deemed severable and
deleted, and all other provisions of this Agreement shall remain unchanged and
in full force and effect.
(j) ENFORCEABILITY IN JURISDICTIONS. The parties hereto intend to and
hereby confer jurisdiction to enforce the covenants contained in Sections 4 and
5 above upon the courts of any state within the geographical scope of such
covenants. If the courts of any one or more of such states shall hold any of the
previous covenants unenforceable by reason of the breadth of such scope or
otherwise, it is the intention of the parties hereto that such determination not
bar or in any way affect the Company's rights to the relief provided above in
the courts of any other states within the geographical scope of such covenants,
as to breaches of such covenants in such other respective jurisdictions, the
above covenants as they relate to each state being, for this purpose, severable
into diverse and independent covenants.
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(k) COUNTERPARTS. This Agreement may be executed in two (2)
counterparts, each of which shall be deemed an original but both of which
together shall constitute one and the same Agreement. Facsimile transmission of
the executed version of this Agreement or any counterpart hereof shall have the
same force and effect as the original.
(l) HEADINGS. The headings of the Sections of this Agreement are
inserted for convenience only and shall not be deemed to constitute part of this
Agreement or to affect the construction of this Agreement.
(m) THIRD PARTY BENEFICIARIES. Company's affiliates and subsidiaries are
expressly made third party beneficiaries of this Agreement.
(n) NOTICES. Any notice required or permitted hereunder shall be
personally delivered or mailed by certified mail, return receipt requested, to
the addresses of the parties set out on the signature pages hereto, or as
changed from time to time by notice as provided herein.
(o) SUCCESSORS AND ASSIGNS. Employee shall not assign or transfer any of
his rights or obligations under this Agreement to any individual or entity.
Company may assign its rights hereunder to any of its affiliates or to any
individual or entity who or that shall acquire or succeed to, by operation of
law or otherwise, all or substantially all of the assets of Company or Company's
Business. All provisions of this Agreement are binding upon, shall inure to the
benefit of, and are enforceable by or against, the parties and their respective
heirs, executors, administrators or other legal representatives and permitted
successors and assigns.
(p) OPPORTUNITY TO CONSULT COUNSEL. EMPLOYEE ACKNOWLEDGES THAT HE HAS
CAREFULLY READ THIS AGREEMENT AND HAS BEEN GIVEN ADEQUATE OPPORTUNITY, AND HAS
BEEN ENCOURAGED BY COMPANY, TO CONSULT WITH LEGAL COUNSEL OF HIS CHOICE
CONCERNING THE TERMS HEREOF BEFORE EXECUTING THIS AGREEMENT.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties have made this Agreement effective as of
the Effective Date.
"COMPANY"
▇▇▇▇▇▇ INTERNATIONAL, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇
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Printed: ▇▇▇▇ ▇. ▇▇▇▇
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Title: Vice President - Corporate Affairs
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▇▇▇▇▇▇ International, Inc.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
"EMPLOYEE"
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇'▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
[Exhibit A - Form of Release of Claims has been omitted from the Agreement
as filed with the Securities and Exchange Commission (the "SEC"). The omitted
information is filed as Exhibit 10.08 to the Registration Statement. The
Registrant will furnish supplementally a copy of any of the omitted exhibit to
the SEC upon request from the SEC.]
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