EXHIBIT 10.1
RETIREMENT
AGREEMENT
THIS RETIREMENT AGREEMENT (this
“Agreement”) is entered into by and between
Robert M. Chiste (“Executive”), and Comverge,
Inc., a Delaware corporation (the “Company”). Executive
and the Company are collectively referred to as Parties and
individually as a Party.
WHEREAS, Executive and the Company
entered into an Executive Employment Agreement (“Employment
Agreement”), attached as Exhibit A to this Agreement,
effective as of January 1, 2008;
WHEREAS, Executive resigned his
employment and all other positions with the Company effective as of
June 19, 2009 (“Resignation Date”); and
WHEREAS, the Employment Agreement
provides for the payment of certain amounts and the provision of
certain benefits to Executive if certain requirements are met,
including various requirements by Executive, and if, in
consideration thereof, Executive executes and delivers in timely
manner, and does not withdraw or revoke, a general release in the
form of this Agreement;
NOW, THEREFORE, in consideration of
their mutual promises and covenants, Executive and the Company
agree as follows:
Executive and the Company agree to
treat Executive’s resignation as a termination by the Company
without Cause for all purposes including for the calculation of the
severance owed under the Employment Agreement and to be paid under
this Agreement. (Capitalized terms not otherwise defined herein
shall have the same meanings as defined in the Employment
Agreement.) The Parties acknowledge and agree that
Executive’s employment with the Company terminated as of the
Resignation Date. In accordance with Section 6.5(c) of the
Employment Agreement, the Company shall:
(i) pay Executive (or Executive’s estate
in the event of his death) the lump sum amount of $1,200,000, less
applicable withholding, on the earlier of: (a) December 21, 2009;
or (b) within 5 business days of being notified of
Executive’s death;
(ii) cause as of the Resignation Date (x) all
unvested options to purchase Company stock that Executive held as
of the Resignation Date to vest immediately and become exercisable
in full and remain exercisable by Executive for the lesser of their
remaining terms or until March 31, 2013, (y) all restricted stock
granted to Executive and not otherwise forfeited to vest
immediately and the legend providing restrictions on the sale or
transfer of such stock related to such
vesting to be removed, and (z) all other
equity-based awards that Executive held as of the Resignation Date
to vest immediately and become payable in full; and
(iii) provide continued coverage to
Executive and his family under the Company’s group health
plans, which are fully-insured plans, through December 31, 2012 (or
such earlier date as may be requested by Executive) at a cost to
Executive not greater than the active employee premium rate for
similar coverage (such coverage is referred to as “Company
Continued Health Coverage”). (In the event any such group
health plan ceases to be a fully-insured plan prior to the end of
the Company Continued Health Coverage Period, and by reason thereof
would result in adverse tax consequences to Executive, the Company
shall (a) provide Executive and his family with an individual
health insurance policy that provides comparable benefits to the
Company’s group health plan with Executive paying a portion
of the premium for such policy not greater than the active employee
premium rate that otherwise would be charged to Executive under the
Company group health plan and (b) if the Company is unable to
provide such an individual health insurance policy, the parties
agree to cooperate with each other to either provide Executive and
his family with coverage under such self-insured plan on a basis
reasonably comparable to his coverage before such change or to make
other arrangements reasonably satisfactory to each party to satisfy
the intent of this Section 1(iii).). Executive’s portion of
the monthly premium for such Company Continued Health Coverage will
be deducted from the consulting and/or Retirement Benefit payments
made to him by the Company pursuant to this Agreement and/or the
Consulting Agreement. Such Company Continued Health Coverage will
count toward and be treated in satisfaction of the Company’s
obligation to provide Executive and his covered family members with
continuation coverage under the Company’s group health plan
pursuant to the Consolidated Omnibus Budget Reconciliation Act of
1985, as amended (“COBRA”). In the event that Executive
or his covered family members elect to discontinue receipt of the
Company Continued Health Coverage prior to December 31, 2012, the
Company will to the extent required by COBRA provide Executive or
his covered family members, as applicable, with notice of their
right to continue their coverage under the Company’s group
health plan for the remainder of the continuation coverage period
prescribed by COBRA.
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a.
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Within 20 business days of the
Effective Date (as herein later defined) of this Agreement, the
Company will pay Executive the amount of: (i) $62,465.75 for unused
but accrued vacation and (ii) Executive’s ordinary and
necessary business expenses, which must be submitted within 10 days
of the Effective Date, incurred during the course of his employment
and submitted in accordance with Company policy and which have not
yet been reimbursed. In addition, the Company will reimburse
Executive for
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all expenses paid by him for the
maintenance of that certain residence at 9 Anderson Drive, Florham
Park, New Jersey through August 31, 2009; provided that :
(i) such reimbursement shall apply only to those forms of expenses
that the Company reimbursed prior to the Resignation Date; and (ii)
in order to receive such reimbursement, Executive must submit
evidence of payment no later than October 30, 2009. The Company
shall reimburse Executive for all expenses referenced in the
previous sentence no later than 20 business days after its receipt
of Executive’s evidence of payment. The Parties acknowledge
and agree that, provided that the Company makes the payments set
forth in this Section 2(a), then it will have paid all salary,
bonus and other non-equity based incentive compensation that was
earned as of the Resignation Date.
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b.
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The Parties acknowledge and agree
that, pursuant to the “Retirement Benefit” referenced
in Section 6.5(e) of the Employment Agreement, the Company shall
provide Executive (or Executive’s estate in the event of his
death) with a total of $1,100,000, plus interest at the rate of 7%
per annum on $100,000 (which amount is equal to six monthly
payments that have been deferred), which will be paid in accordance
with the schedule set forth in Exhibit B (subject to any deductions
as contemplated by Section 1(iii) of this Agreement), which is
attached and incorporated into this Agreement. This provision and
Exhibit B satisfies all other agreements regarding the Retirement
Benefit including without limitation Section 6.5(e) in the
Employment Agreement.
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c.
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If a Change of Control occurs before
December 19, 2009, the Company will pay Executive (or
Executive’s estate, in the event of his death) $1,050,000
after such Change of Control occurs on the earlier of: i) December
21, 2009; or ii) within 5 business days of being notified of
Executive’s death.
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d.
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Within 20 business days of the
Effective Date of this Agreement, the Company agrees to reimburse
Executive $12,000 in order to offset the costs of moving furniture
or other personal effects, as identified by Executive, now owned by
Executive and located at 9 Anderson Drive, Florham Park, New
Jersey.
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e.
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The Parties acknowledge and agree
that the sums set forth in Sections 1, 2 and 3 of this Agreement
represent the exclusive and total amount to be paid to Executive by
the Company, in connection with or arising out of his employment
with the Company and/or his termination of employment with the
Company, and no further amounts shall be required for any items not
listed herein, including but not limited to attorneys’
fees.
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The Parties recognize that the
Company has continuing obligations to Executive pursuant to Section
6.5(g) of the Employment Agreement. Accordingly, that Section
6.5(g) is hereby repeated and incorporated by reference herein such
that, anything in this Agreement or the Employment Agreement
notwithstanding, in the event it shall be determined that any
payment or benefit by the Company to or for the benefit of
Executive, whether pursuant to the terms of this Agreement or
otherwise, would be subject to the Excise Tax, then the Company
shall provide the Gross-Up Payment to Executive unless the terms of
Section 6.5(g) of the Employment Agreement do not require such
Gross-Up Payment.
Executive, on behalf of himself,
hisheirs, beneficiaries and personal representatives, hereby
releases, acquits and forever discharges the Company, its owners,
officers, predecessors, successors, employees, former employees,
shareholders, directors, partners, attorneys, agents and assigns,
and all other persons, firms, partnerships, or corporations in
control of, under the direction of, or in any way presently or
formerly associated with the Company (collectively, “Company
Affiliates”), o
