Exhibit 10.2
SEVERANCE PAY AGREEMENT FOR KEY EMPLOYEE
This agreement is entered into as of April 1, 2005 (the "Employment Date")
between ▇▇▇▇▇▇ Automotive Group, Inc. ("▇▇▇▇▇▇") and ▇▇▇▇▇▇▇ ▇▇▇▇ ("Executive"),
a key employee of ▇▇▇▇▇▇, in order to provide for an agreed-upon compensation in
the event that Executive's employment is terminated as defined in this
agreement.
1. Severance Pay Arrangement
If a Termination (as defined below) of Executive's employment occurs at any
time during Executive's employment, except as provided herein, ▇▇▇▇▇▇ will
pay Executive Severance Pay based upon Executive's base salary as of the
date of Termination, as calculated below. Payment (subject to required
withholding) will be made by ▇▇▇▇▇▇ to Executive monthly on the regular
payroll dates of ▇▇▇▇▇▇ starting with the date of Termination. The amount
of Executive's Severance Pay will at no time be less than 18 months or
greater than 36 months of Executive's base salary. If Executive's
employment were terminated in the first month following the Employment
Date, Executive would be eligible for 36 months of Severance Pay. Following
the first month after the Employment Date and each successive month of
employment that Executive completes, up to 18, one month of severance pay
eligibility will be removed. For example, after 6 completed months of
employment, Executive would be eligible for 30 months of Severance Pay.
After 18 months of employment, and for the duration of Executive's
employment with ▇▇▇▇▇▇, Executive will be eligible for 18 months of
Severance Pay. For purposes of calculating Severance Pay eligibility, time
spent by Executive on any type of approved or required leave of absence,
vacation or holiday will count towards completed months of employment
determinations.
If Executive participates in a bonus compensation plan at the date of
Termination, Severance Pay will also include a bonus payment in an amount
equal to the bonus earned but not already paid for the year of Termination
prorated through the date of Termination.
In addition, Executive shall be entitled for 12 months following the date
of Termination to continue to participate at the same level of coverage and
Executive contribution in any health and dental plans, as may be amended
from time to time, in which Executive was participating immediately prior
to the date of Termination. Such participation will terminate 30 days after
Executive has obtained other employment under which Executive is covered by
equal benefits. Executive agrees to notify ▇▇▇▇▇▇ promptly upon obtaining
such other employment. At the option of Executive, COBRA coverage will be
available, as provided by company policy, at the termination of the
extended benefits provided above.
However, nothing herein shall be construed to provide Executive Severance
Pay eligibility should Executive be found to have engaged in conduct that
would qualify as "cause" for termination, as that term is defined in
Section 2 below, even if the conduct was discovered by the Company after
Executive's "termination" and the commencement of Severance Pay. If such
"cause" is found after any amount of Severance Pay has already been
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remitted to Executive, Executive agrees and understands that the Company
expressly reserves the right to stop any future payments, and recover any
amounts already paid.
2. Definition of Termination Triggering Severance Pay
A "Termination" triggering the Severance Pay set forth above in Section 1
is defined as (1) termination of Executive's employment by ▇▇▇▇▇▇ for any
reason, except death, disability, retirement, voluntary resignation or
"cause", or (2) ▇▇▇▇▇▇'▇ reduction of Executive's base salary. The
definition of "cause" is: (a) Executive's gross negligence or serious
misconduct (including, without limitation, any criminal, fraudulent or
dishonest conduct) that is injurious to ▇▇▇▇▇▇ or any of its affiliates; or
(b) Executive being convicted of, or entering a plea of nolo contendere to,
any crime that constitutes a felony or involves moral turpitude; or (c)
Executive's material breach of Sections 3, 4 or 5 below; or (d) Executive's
willful and continued failure to substantially perform Executive's duties
with ▇▇▇▇▇▇; (e) Executive's material breach of a material written policy
of ▇▇▇▇▇▇; or (f) Executive's acceptance of compensation from any source
and in any form, other than that specifically provided for by this
Agreement, related in any way to Executive's position with the Company. The
definition of "disability" is a physical or mental disability or infirmity
that prevents the performance by Executive of his duties lasting (or likely
to last, based on competent medical evidence presented to ▇▇▇▇▇▇) for a
continuous period of six months or longer.
3. Confidential Information Nondisclosure Provision
During and after employment with ▇▇▇▇▇▇, Executive agrees not to disclose
to any person (other to an employee or director of ▇▇▇▇▇▇ or any affiliate
and except as may be required by law) and not to use to compete with ▇▇▇▇▇▇
or any affiliate any confidential or proprietary information, knowledge or
data that is not in the public domain that was obtained by Executive while
employed by ▇▇▇▇▇▇ with respect to ▇▇▇▇▇▇ or any affiliate or with respect
to any products, improvements, customers, methods of distribution, sales,
prices, profits, costs, contracts, suppliers, business prospects, business
methods, techniques, research, trade secrets or know-how of ▇▇▇▇▇▇ or any
affiliate (collectively, "Confidential Information"). In the event
Executive's employment terminates for any reason, Executive will deliver to
▇▇▇▇▇▇ on or before the date of termination all documents and data of any
nature pertaining to Executive's work with ▇▇▇▇▇▇ and will not take any
documents or data or any reproduction, or any documents containing or
pertaining to any Confidential Information. Executive agrees that in the
event of a breach by Executive of this provision, ▇▇▇▇▇▇ shall be entitled
to inform all potential or new employers of this provision and to cease
payments and benefits that would otherwise be made pursuant to Section 1
above, as well as to obtain injunctive relief and damages which may include
recovery of amounts paid to Executive under this agreement.
4. Non-Solicitation of Employees
Executive agrees that for a period of one year from Executive's last day of
employment with ▇▇▇▇▇▇, Executive shall not directly or indirectly solicit
for employment or employ any person who, at any time during the 12 months
preceding such last day of Executive's employment, is or was employed by
▇▇▇▇▇▇ or any affiliate or induce or attempt to persuade any employee of
▇▇▇▇▇▇ or any affiliate to terminate their employment relationship.
Executive agrees that in the event of a breach by Executive of this
provision, ▇▇▇▇▇▇ shall be entitled to inform all potential or new
employers of this provision and to cease payments and benefits that would
otherwise be made pursuant to Section 1 above, as well as to obtain
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injunctive relief and damages which may include recovery of amounts paid to
Executive under this agreement.
5. Covenant Not to Compete
While Executive is employed by ▇▇▇▇▇▇, Executive shall not directly or
indirectly engage in, participate in, represent or be connected with in any
way, as an officer, director, partner, owner, employee, agent, independent
contractor, consultant, proprietor or stockholder (except for the ownership
of a less than 5% stock interest in a publicly-traded corporation) or
otherwise, any business or activity which competes with the business of
▇▇▇▇▇▇ or any affiliate unless expressly consented to in writing by the
Chief Executive Officer of ▇▇▇▇▇▇ (collectively, "Covenant Not To
Compete").
Covenant Not To Compete shall remain in effect for one year following the
date of termination except that the prohibition above on "any business or
activity which competes with the business of ▇▇▇▇▇▇ or any affiliate" shall
be limited to any business competing with ▇▇▇▇▇▇ that is located or does
business within 50 miles of any ▇▇▇▇▇▇ location where Executive had
supervisory responsibility while employed by ▇▇▇▇▇▇. Executive shall
disclose in writing to ▇▇▇▇▇▇ the name, address and type of business
conducted by any proposed new employer of Executive if requested in writing
by ▇▇▇▇▇▇. Executive agrees that in the event of a breach by Executive of
this Covenant Not To Compete, ▇▇▇▇▇▇ shall be entitled to inform all
potential or new employers of this Covenant and to cease payments and
benefits that would otherwise be made pursuant to Section 1 above, as well
as to obtain injunctive relief and damages which may include recovery of
amounts paid to Executive under this agreement.
GENERAL PROVISIONS
A. Employment is At Will
Executive and ▇▇▇▇▇▇ acknowledge and agree that Executive is an "at will"
employee, which means that either Executive or ▇▇▇▇▇▇ may terminate the
employment relationship at any time, for any reason, with or without cause
or notice, and that nothing in this agreement shall be construed as an
express or implied contract of employment.
B. Execution of Release
As a condition to the receipt of the Severance Pay payments and benefits
described in Section 1 above, Executive agrees to execute a release of all
claims arising out of Executive's employment or termination, including, but
not limited to, any claim of discrimination, harassment or wrongful
discharge under local, state or federal law.
C. Other Provisions
This agreement shall be binding upon the heirs, executors, administrators,
successors and assigns of Executive and ▇▇▇▇▇▇, including any successor to
▇▇▇▇▇▇.
The transfer of Executive from ▇▇▇▇▇▇ to any of its affiliates shall not be
deemed to be a Termination pursuant to clause (1) of Section 2 of this
agreement until such time as Executive is no longer employed by ▇▇▇▇▇▇ or
any of its affiliates. If Executive is transferred to an affiliate of
▇▇▇▇▇▇, references to "▇▇▇▇▇▇" herein shall be deemed to include the
applicable affiliate to which Executive is transferred.
Any controversy or claim arising out of or relating to Executive's
employment with the Company, the termination of Executive's employment,
this Agreement, or the breach thereof, shall be finally settled by binding
arbitration in accordance with the Federal Arbitration Act before an
arbitrator (who shall be an attorney with at least ten years' experience in
employment law) mutually-agreed to by the parties, in or near the city
where Executive resides. The arbitrator will be bound to follow the
substantive law governing the claims pled in the jurisdiction in which the
claims arise, and shall apply the federal rules of procedure and evidence
applicable to disputes resolved by a bench trial in a United States
District Court. Executive and the Company agree that any judgment upon any
award rendered by the arbitrators may be entered in any court having
jurisdiction thereof.
The headings and captions are provided for reference and convenience only
and shall not be considered part of this agreement.
If any provision of this agreement shall be held invalid or unenforceable,
such holding shall not affect any other provisions, and this agreement
shall be construed and enforced as if such provisions had not been
included.
All notices and other communications required or permitted under this
agreement shall be in writing (including a facsimile or similar writing)
and shall be deemed given when (1) delivered personally, (2) sent by
certified or registered mail, postage prepaid, return receipt requested or
delivered by overnight courier (provided that a written acknowledgment of
receipt is obtained by the overnight courier) to the party concerned at the
address indicated below or to such changed address as such party may
subsequently give such notice of or (3) if given by facsimile, at the time
transmitted to the respective facsimile numbers set forth below, or to such
other facsimile number as either party may have furnished to the other in
writing in accordance herewith, and the appropriate confirmation received
(or, if such time is not during a business day, at the beginning of the
next such business day); provided, however, that notice of change of
address shall be effective only upon receipt:
If to ▇▇▇▇▇▇: ▇▇▇▇▇▇ Automotive Group, Inc.
c/o General Counsel
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to Executive: To the most recent address and facsimile number, if
applicable, of Executive set forth in the personnel records of ▇▇▇▇▇▇.
This agreement supersedes any and all agreements between ▇▇▇▇▇▇ and
Executive relating to payments upon termination of employment or severance
pay and may only be modified in writing signed by ▇▇▇▇▇▇ and Executive.
This agreement shall be governed by and construed in accordance with the
laws of the State of Florida.
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All payments hereunder shall be subject to any required withholding of
federal, state, local and foreign taxes pursuant to any applicable law or
regulation.
No provision of this agreement shall be waived unless the waiver is agreed
to in writing and signed by Executive and the Chief Executive Officer of
▇▇▇▇▇▇. No waiver by either party of any breach of, or of compliance with,
any condition or provision of this agreement by the other party shall be
considered a waiver of any other condition or provision or of the same
condition or provision at another time.
This agreement may be executed in one or more counterparts, each of which
shall be deemed to be an original but all of which together will constitute
one and the same instrument.
AGREED TO ON JUNE 10, 2005, EFFECTIVE AS OF THE DATE FIRST WRITTEN ABOVE:
BY EXECUTIVE BY ▇▇▇▇▇▇ AUTOMOTIVE
GROUP, INC.
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇ /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
President and Chief Executive Officer
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