Retention/Severance Agreement - Collins & Aikman Products Co. and Paul W. Meeks
RETENTION/SEVERANCE AGREEMENT
THIS RETENTION/SEVERANCE AGREEMENT (the "Agreement") is made as
of September 26, 1994, between Collins & Aikman Products Co., a
Delaware corporation (the "Company"), and Paul W. Meeks
("Employee").
W I T N E S S E T H
WHEREAS, Employee is currently employed by the Company; and
WHEREAS, the Company wishes to retain Employee's services by
providing Employee with the benefits set forth in this Agreement.
NOW, THEREFORE, in consideration of Employee's continued
employment and the mutual agreements contained herein, the
parties agree as follows:
1. Term of Employment; Base Salary; Duties; Bonus
(a) The Company agrees to continue to employ Employee,
and Employee hereby accepts such continued employment, until
October 31, 1994 (the "Scheduled Termination Date"), subject to
the terms and conditions of this Agreement. Employee's
employment with the Company shall end on the Scheduled
Termination Date (if not previously terminated by Employee or by
the Company for Cause, as hereinafter defined) unless otherwise
agreed to by the parties.
(b) Until October 31, 1994, the Company shall pay
Employee a base salary at the rate as in effect on the date of
this Agreement.
(c) Until October 31, 1994, Employee shall be Vice
President and Treasurer of the Company and shall report to the
Chief Financial Officer of the Company and perform such services
for the Company and its subsidiaries as may be assigned to him
from time to time by the Chief Financial Officer of the Company,
either of its Vice-Chairmen or any other executive officer of the
Company; it being understood that during the period from August
1, 1994 until October 31, 1994, Employee shall be permitted to
devote a substantial portion of his time to a job search. During
the term of Employee's employment hereunder, the Company shall
continue to furnish Employee with an office and a telephone and
Employee shall continue to receive assistance from a secretary
serving one or more employees of the Company.
(d) Employee shall receive a bonus for the fiscal year
ending January 28, 1995 ("Fiscal 1994") equal to 75% of the bonus
which Employee would have received had his employment not
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terminated prior to the end of Fiscal 1994 under the Collins &
Aikman Corporation 1994 Executive Incentive Compensation Plan
(the "Bonus Plan"). Employee's Target Bonus for such purposes
shall remain at 30% of his base compensation and his bonus shall
be determined by the compensation committee of the Company.
Subject to the provisions of the Bonus Plan, in no event shall
Employee's bonus be reduced below 75% of the bonus as calculated
pursuant to this paragraph. Any bonus granted to Employee shall
be payable on or before April 1, 1995.
2. Notice of Termination of Employment. The Company may
terminate Employee's employment with the Company (i) for Cause at
any time without notice or (ii) on the Scheduled Termination
Date. "Cause" means (A) an act of fraud, embezzlement,
misappropriation of business or theft committed by Employee in
the course of his employment or any intentional or negligent
misconduct of Employee which injures the business or reputation
of the Company or any affiliate of the Company; (B) intentional
or negligent damage committed by Employee to the property of the
Company or any affiliate of the Company; (C) Employee's willful
failure or refusal to perform the customary duties and
responsibilities of his position with the Company or any
affiliate of the Company; (D) Employee's breach of fiduciary duty
or representation to the Company or any affiliate of the Company;
(E) Employee's intentional or negligent violation of any written
policy of the Company; (F) Employee's willful failure or refusal
to act in accordance with any specific lawful instructions of a
majority of the Board of Directors of the Company; or (G)
conviction of Employee of a felony or a crime involving moral
turpitude.
3. Severance. In the event Employee's employment with the
Company ends on the Scheduled Termination Date or Employee
voluntarily terminates his employment with the Company at any
time after July 31, 1994, Employee shall be entitled to receive
(i) as of the date on which Employee's employment with the
Company terminates, cash in a lump sum for (x) any unused
vacation days for the entire calendar year of 1994 and (y) any
unused vacation days accrued by Employee under the Wickes
Companies, Inc. vacation policy and (ii) as severance his base
salary as in effect on the date his employment terminates for a
fifteen-month period following the date his employment
terminates. Such severance shall be paid on a periodic basis
over such fifteen-month period in accordance with normal pay
practice, provided, however, that if Employee commences
employment with another employer prior to the expiration of such
fifteen-month period, the balance of any severance due to him
shall be paid in a lump sum as soon as practicable thereafter.
In addition, until the expiration of such fifteen-month period
or, if earlier, the date on which Employee commences employment
with another employer, (i) Employee shall participate in the
medical, vision and dental plans of the Company on the same basis
as if Employee was still employed and Employee shall be obligated
to pay the monthly associate deduction in order to continue such
benefits,
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which deduction shall be taken from the amount due to
Employee pursuant to the first sentence of this paragraph 3, (ii)
Employee shall receive basic life insurance coverage under the
Company's life insurance plan on the same basis as if Employee
was still employed (but no optional coverage), (iii) Employee
shall continue to participate in the Company's profit-sharing,
pension and 401(k) savings plans to the same extent as other
former employees of the Company on severance receiving salary
continuation, (iv) Employee shall receive $400 per month as an
automobile allowance and up to $150 per month for automobile
maintenance and shall continue to be covered under the Company's
automobile insurance policy, and (v) Employee shall be entitled
to outplacement services at an outplacement agency designated by
Employee, provided that the cost to the Company for such
outplacement services shall not exceed an aggregate of $5,000.
In addition, Employee shall continue to be covered under the
Company's long term disability plan for a period of 12 weeks from
the date Employee's employment with the Company terminates or
until the date Employee commences employment with another
employer, if earlier. The amount due to Employee pursuant to
clause (ii) of the first sentence of this paragraph 3 shall be
reduced by the amount of any payments that Employee or his estate
or legal representative may be entitled to receive by reason of
Employee's disability under any disability insurance plan of the
Company or any of its subsidiaries.
4. Non-Disclosure; Insider Trading Policy.
(a) Employee recognizes and acknowledges that in the
course of his employment and as a result of the position of trust
he holds with the Company he has obtained private or confidential
information and proprietary data relating to the Company and its
affiliates, including without limitation financial information.
All of such private or confidential information and proprietary
data is referred to herein as "Confidential Information";
provided, however, that Confidential Information will not include
any information known generally to the public (other than as a
result of unauthorized disclosure by Employee).
(b) Employee agrees that he will not, during his
employment or any time thereafter, either directly or indirectly,
disclose or use Confidential Information, except as necessary in
order to fulfill his duties of employment with the Company or any
affiliate of the Company or with the prior written consent of the
Co-Chairmen or Chairman of the Company. The covenants of
Employee set forth in this paragraph 4 constitute agreements
independent of any other provisions of this Agreement and
Employee acknowledges that his failure to comply with the
provisions of this paragraph 4 will result in irreparable and
continuing damage for which there will be no adequate remedy at
law and that, in the event of a failure of Employee so to comply,
the Company shall be entitled, without the necessity of proving
actual damages or securing or posting any bond, to injunctive
relief in addition to all other
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remedies which may otherwise be available to the Company and
to such other and further relief as may be proper and necessary
to ensure compliance with the provisions of this paragraph.
(c) During the period of his employment hereunder and
for a period of six months thereafter, Employee shall comply with
the policy of the Company regarding the use or disclosure of
inside information as set forth in a policy statement dated June
23, 1994, as such policy statement may be revised from time to
time.
5. Cooperation. During his employment and at any time
thereafter, Employee shall promptly notify the Company of any
threatened, pending or completed investigation, claim, action,
suit or proceeding, whether civil, criminal, administrative or
investigative ("Proceeding"), in which he may be involved, whether
as an actual or potential party or witness or otherwise, or with
respect to which he may receive requests for information, by
reason of his future, present or past association with the
Company or any affiliate of the Company. Employee shall
cooperate fully with the Company and any affiliate of the Company
in connection with any Proceeding at no expense to the Company or
any affiliate of the Company other than the reimbursement of
Employee's reasonable out-of-pocket expenses. Employee shall not
disclose any confidential or privileged information in connection
with any Proceeding without the written consent of the Company
and shall give prompt notice to the Company of any request
therefor.
6. Employment Tax Withholding. Employee agrees that
Company may withhold and deduct from any compensation payable
under this Agreement any amounts that the Company in good faith
believes may be required to be withheld pursuant to any law or
governmental regulation or ruling heretofore or hereinafter
enacted.
7. Binding Effect. This Agreement will inure to the
benefit of and be binding upon the Company and its successors and
assigns, including, without limitation, any person (i) which may
acquire all or virtually all the Company's assets or (ii) with or
into which the Company may be liquidated, consolidated, merged or
otherwise combined, and will inure to the benefit of and be
binding upon Employee, his heirs, distributees, and personal
representatives.
8. Severability. If any provision of this Agreement is
held to be invalid, illegal, or unenforceable, in whole or in
part, such invalidity, illegality or unenforceability will not
affect any other provision, and all other valid, legal and
enforceable provisions will remain in full force and effect.
9. Survival of Certain Provisions. Notwithstanding
anything herein to the contrary, the obligations of Employee and
the Company under paragraphs 4 and 5 will remain operative and in
full force and effect regardless of the expiration or termination
of this Agreement.
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10. Titles. The titles preceding the text of the
paragraphs of this Agreement have been inserted solely for
convenience of reference and do not constitute a part of this
Agreement or affect its meaning, interpretation or effect.
11. Entire Agreement; Modification. This Agreement
supersedes all previous agreements, negotiations, or
communications between Employee and the Company (including,
without limitation, the letter agreement dated August 12, 1992
between Collins & Aikman Group, Inc. (which was merged into the
Company) and Employee (the "Prior Agreement")) and contains the
complete and exclusive expression of the understanding between
the parties. This Agreement cannot be amended, modified, or
supplemented in any respect except by a subsequent written
agreement entered into by both parties. The failure of either
party to insist in any one of more instances upon performance of
any terms, covenants of conditions of this Agreement will not be
construed as a waiver of future performance of any such term,
covenant, or condition and the obligations of either party with
respect to such term, covenant or condition will continue in full
force and effect.
12. No Employment Right; Release. This Agreement does not
affect the right of the Company to terminate Employee's
employment at any time in accordance with paragraph 2 hereof.
For good and valuable consideration, Employee unconditionally
releases the Company and its affiliates and partners, directors,
officers and employees thereof, from any and all claims,
liabilities and obligations of any nature pertaining to
termination of employment other than those explicitly provided
for by this Agreement including, without limitation, any claims
arising out of (i) the Prior Agreement, (ii) the Company's Equity
Share Plan, which was terminated in October 1993, (iii) the
Company's 1993 Employee Stock Option Plan, (iv) the Company's
1994 Employee Stock Option Plan or (v) any alleged legal
restrictions on the Company's rights to terminate its employees,
such as any implied contract of employment or termination
contrary to public policy or to laws prohibiting discrimination
(including, without limitation, the Age Discrimination in
Employment Act). Notwithstanding anything to the contrary
contained herein, the Company shall not be obligated to pay
Employee any amount pursuant to paragraph 2 hereof unless
Employee executes and delivers to the Company a new release,
dated the date of his termination of employment, containing the
substance of the foregoing release and such other provisions as
the Company may request to effect the purposes of the foregoing
release.
13. Governing Law. This Agreement will be construed and
enforced in accordance with the internal laws of the State of New
York.
IN WITNESS WHEREOF, the parties have executed this Agreement
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as of the date and year first above written.
COLLINS & AIKMAN PRODUCTS CO.
By (Signature of Harold R. Sunday)
Name: Harold R. Sunday
Title: Vice President -
Human Resources
By (Signature of Paul W. Meeks)
Paul W. Meeks