EX 10.13
AGREEMENT OF SEPARATION,
RELEASE, AND NONCOMPETITION
THIS AGREEMENT OF SEPARATION,
RELEASE, AND NONCOMPETITION (“Agreement”), is made and entered
into by and between CHART INDUSTRIES, INC., a Delaware corporation
(the “Company”) and ARTHUR S. HOLMES
(“Executive”) with an Effective Date as defined
herein.
W I T N E S S E T
H :
WHEREAS , pursuant to an Employment Agreement dated
November 13, 2001 (“the Employment Agreement”),
Executive has been employed by the Company as its Chairman and
Chief Executive Officer; and
WHEREAS , as a result of the Company’s recent
bankruptcy and reorganization, Executive desires to resign from his
employment, and the Company desires to accept said resignation;
and
WHEREAS , the Company and Executive wish to resolve all
matters and issues between them arising from or relating to
Executive’s employment by the Company.
NOW, THEREFORE
, in consideration of the mutual
promises and covenants contained herein, Executive and the Company
hereby agree as follows:
ARTICLE I —
CONSIDERATION
Section 1.1. Resignation .
Executive, through his signature below, voluntarily resigns from
his position as Chairman and Chief Executive Officer of the Company
effective September 15, 2003, and further resigns from his
employment with the Company effective November 28, 2003
(“Date of Resignation”). The Company, through its
execution below, hereby consents to and accepts Executive’s
resignation. The parties hereby acknowledge and agree that
Executive’s resignation hereunder shall be deemed a voluntary
termination by Executive with Good Reason, as that term is defined
in the Employment Agreement, and the Company further waives the
requirement of fifteen (15) calendar days written notice of same
from Executive. Executive’s employment records with the
Company will reflect the voluntary nature of the cessation of his
employment, and the Company and Executive each expressly
acknowledge that he has not been “discharged” or
“terminated” by the Company, constructively or
otherwise. The parties acknowledge and agree that Executive serves
as a director of the Company pursuant to the terms of the
Company’s Amended Joint Prepackaged Reorganization Plan,
dated September 3, 2003 (the “Plan of Reorganization”),
and that Executive’s resignations from his position as
Chairman and Chief Executive Officer and from his employment with
the Company shall not be construed as a resignation from service as
a director of the Company.
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Section 1.2. Separation Pay .
Upon the Effective Date of this Agreement as defined in §4.7
hereof, the Company will make payment to Executive in the lump sum
amount of Six Hundred Twenty Four Thousand Six Hundred Ninety Six
Dollars and Fifty Eight Cents ($624,696.58) less applicable payroll
taxes and withholdings (the “Separation
Payment”).
Section 1.3. Restrictive
Covenants . Upon the Effective Date of this Agreement as
defined in §4.7 hereof, and as consideration for
Executive’s agreements set forth in Article III of this
Agreement, the Company will make payment to Executive in the lump
sum amount of Five Hundred Fourteen Thousand Dollars ($514,000.00)
(the “Restrictive Covenants Payment”). The Company
shall not withhold any amounts from the Restrictive Covenants
Payment, and Executive shall assume responsibility for the payment
of any of Executive’s portion of taxes and withholdings
incurred in connection with the Restrictive Covenants Payment,
including interest and penalties with respect to both the
Company’s and Executive’s portions in the event that
Executive fails to include the amount in income and pay the income
tax thereon. The parties further agree that the Company may issue
or file a Form 1099 or other notice to the Internal Revenue Service
regarding the Restrictive Covenants Payment.
Section 1.4. Group Insurance
Coverage . For the period continuing through January 30, 2006,
the Company shall continue to provide to Executive, or cause to be
provided to him, group health, dental, vision, and group life
insurance benefits at the same level and to the same extent such
benefits were provided to him immediately prior to the Date of
Resignation. If at any time between the Date of Resignation and
January 30, 2006, the Company is not able to continue to provide to
Executive group health, dental, vision, or group life insurance
benefits as described in the preceding sentence, then the Company
shall reimburse Executive for his costs in purchasing health,
dental, vision, or life insurance coverage providing at least
equivalent coverage, with such reimbursement to be in an amount
which, after taxes on the receipt of such reimbursement, shall
equal such cost to Executive. At the conclusion of the period
continuing through January 30, 2006, Executive shall be entitled to
continuation of coverage under the Company’s health insurance
plan at his own expense pursuant to any rights he may have under
the federal Consolidated Omnibus Budget Reconciliation Act, as
amended (“COBRA”), part VI of Subtitle B of Title I of
the Employee Retirement Income Security Act of 1974
(“ERISA”), as amended; Internal Revenue Code
§4980(B)(f).
Section 1.5. Deemed Bonus Amount
for 2003 . Upon the Effective Date of this Agreement as defined
in §4.7 hereof, the Company will make payment to Executive in
the lump sum amount of One Hundred Fifty Nine Thousand Four Hundred
Forty Four Dollars and Forty Four Cents ($159,444.44), less
applicable payroll taxes and withholdings, which sum represents
Executive’s proportionate share of the $175,000 Deemed Bonus
Amount for 2003 through the Effective Date (the “Bonus
Payment”).
Section 1.6. D&O Liability
Coverage and Indemnification . For a period of six (6) years
following the Date of Resignation, the Company will maintain
Directors & Officers Liability Insurance (“tail”)
coverage for Executive to insure against claims arising out of his
service as a Director or Officer of the Company prior to September
15, 2003. As to Executive’s continued service on the
Company’s Board of Directors, the Company will maintain
customary Directors & Officers Liability Insurance coverage for
Executive to insure against claims arising out of his service on
the Company’s Board of Directors, and such coverage shall be
at least equivalent to the coverage provided to other directors.
The Company further agrees to defend
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and indemnify Executive against any claims
arising out of his employment by the Company, as provided in §
8 of the Employment Agreement and by the Indemnification Agreement
between Executive and the Company dated August 1, 2002.
Section 1.7. Company-Provided
Business Equipment . For the period beginning on the Date of
Resignation and continuing through January 30, 2006, Executive may
continue to possess and use the laptop computer and related
accessories, cell phones, and home office phone provided by the
Company, on the same basis as such equipment was provided by the
Company prior to the Date of Resignation.
Section 1.8. Consultant’s
and Attorney’s Fees . The Company will pay
Executive’s reasonable and actual consultant’s and
attorney’s fees and expenses in connection with this
Agreement, including those of Stout/Resius/Ross Inc., Ernst &
Young, and Baker & Hostetler LLP, in an aggregate amount not to
exceed Fifty Thousand Dollars ($50,000.00), with such payments to
be made within a reasonable time after presentment of invoices for
said fees to the Company.
Section 1.9. Automobile Use .
The Company will continue to provide Executive with continued
possession and use of the automobile leased by the Company and
assigned to Executive as of the Date of Resignation, and Executive
shall have use of such automobile through January 30, 2006,
provided that Executive reimburses the Company for the lease
payments by submitting to the Company on a monthly basis payments
in the amount of Seven Hundred Three Dollars and Thirty-Two Cents
($703.32). Executive’s monthly payments for the automobile
shall be due to the Company on or before the fifth calendar day of
each month. In the event that Executive fails to make any monthly
payment to the Company within ten (10) calendar days of the due
date for such payment, then the Company shall provide written
notice to Executive, at his last known address, of such failure. If
payment is not received within ten (10) calendar days from the date
of said written notice, then the Company shall have the right to
take possession of the automobile. Executive shall return such
automobile to the Company in good condition, reasonable wear and
tear excepted, on or before January 30, 2006. From the Effective
Date of this Agreement through January 30, 2006, Executive shall be
responsible for maintaining insurance coverage on the automobile
with the same coverages and policy limits as existed as of the Date
of Resignation, and name the Company as a named insured. From the
Effective Date of this
