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EXHIBIT 10.2
SEPARATION AGREEMENT
AND RELEASE
This
SEPARATION AGREEMENT AND RELEASE (the "Agreement") is made as
of
April 15, 2005, by and among GTECH Holdings
Corporation ("Holdings"), GTECH
Corporation ("GTECH") and David J. Calabro
("Executive"). Holdings, GTECH and
their respective direct and indirect
subsidiaries and affiliates and any of
their respective officers, directors or
employees are herein collectively called
the "Company".
WITNESSETH:
WHEREAS,
Executive has been employed by the Company since 1999, most
recently as Executive Vice President and
Chief Executive Officer; and
WHEREAS,
the Company and Executive desire to set forth the terms and
conditions for a mutually agreeable
separation from the Company; and
WHEREAS,
the Company and Executive were parties to the following: a
letter
agreement dated January 22, 1999 (the
"January 1999 Letter Agreement"); a letter
agreement dated November 22, 1999 (the
"November 1999 Letter Agreement"); a
letter agreement dated September 18, 2001
(the "2001 Letter Agreement"); a
letter agreement dated September 10, 2002
(the "2002 Letter Agreement"); a
separation agreement dated February 1, 1999
(the "Separation Agreement"); a
Change of Control Agreement dated April 14,
1999 (the "Change of Control
Agreement"); the "Code" (defined in Section
8 hereof); a Restrictive Agreement
dated January 25, 1999 (the "Restrictive
Agreement")' and
WHEREAS,
the Company and Executive also were parties to various stock
option agreements, restricted stock
agreements, and amendments thereto (such
stock option agreements, restricted stock
agreements and amendments being
sometimes referred to herein collectively
as the "Stock Compensation
Agreements", and the January 1999 Letter
Agreement, the November 1999 Letter
Agreement, the 2001 Letter Agreement, the
2002 Letter Agreement, the Separation
Agreement, the Change of Control Agreement,
the Code, the Restrictive Agreement
and the Stock Compensation Agreements being
sometimes referred to herein
collectively as the "Executive's Employment
Related Agreements"); and
WHEREAS,
the Company and Executive desire to execute this Agreement
respecting the terms and conditions of
Executive's separation from the Company;
NOW,
THEREFORE, the parties hereto hereby agree as follows:
1.
Termination of Employment. It is hereby agreed that Executive's
employment with the Company will terminate
effective May 15, 2005 (the
"Termination Date") and that Executive will
be deemed to have resigned
voluntarily from such employment as of the
Termination Date. It is also hereby
agreed that Executive shall no longer serve
as an
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officer and/or director of Holdings and all
direct and indirect subsidiaries and
other affiliates of Holdings. Executive
agrees to sign letters of resignation
for each of the positions he holds as a
director or officer of all Holdings
subsidiaries and affiliates.
2. Release
by Executive. Except as specifically provided in this Agreement
or the Stock Agreements, Executive hereby
IRREVOCABLY AND UNCONDITIONALLY
RELEASES, ACQUITS, FOREVER FULLY DISCHARGES
AND COVENANTS NOT TO SUE OR
OTHERWISE PARTICIPATE IN ANY ACTION AGAINST
the Company, and its predecessors,
successors and assigns, and the current and
former directors, officers,
employees, agents, attorneys,
representatives, predecessors, and insurers and
reinsurers of said corporations, firms,
associations, partnerships and entities,
and their guardians, successors, assigns,
heirs, executors and administrators
(all of which persons and entities are
hereinafter collectively referred to as
"Executive Releasees"), from or regarding
any and all claims, counterclaims,
actions, causes of action, cross-claims,
complaints, grievances, promises,
liabilities, obligations, agreements,
damages, rights, debts, demands,
controversies, costs, losses, and expenses
(including, without limitation,
attorneys' fees, court costs and expenses)
of whatever nature or kind, in law or
in equity, or otherwise, whether now known
or unknown, which the Executive now
has or may ever have had prior to the
"Effective Date" (as defined in Section 12
hereof) against all or any of the Executive
Releasees. Without limiting the
foregoing, except as provided in this
Agreement, the release and covenant not to
sue set forth in the immediately preceding
sentence applies to all claims under
any municipal, local, state or federal law,
common or statutory, for any actions
or omissions, whether known or unknown,
that arise from, relate to, or are in
any way connected with claims of breach of
contract and wrongful termination and
claims arising under the Federal Age
Discrimination in Employment Act, and any
other federal, state or local laws
prohibiting employment discrimination or
claims growing out of any legal
restrictions on the Company's right to terminate
its employees. This release and covenant
not to sue applies to all claims
relating to Executive's employment by the
Company including all claims based on
the Executive's Employment Related
Agreements. This release and covenant not to
sue also applies to all common law claims
including breach of contract, fraud,
negligence, negligent misrepresentation,
and any other tort or contract claim,
and EXCEPT AS PROVIDED IN AND SUBJECT TO
THE LIMITATIONS SET FORTH HEREIN, THIS
IS A FULL, COMPLETE AND GENERAL RELEASE.
Executive further represents and
warrants that he has not heretofore
assigned any claims that he may have against
the Executive Releasees to any other person
or entity. Notwithstanding any of
the foregoing, the Company acknowledges
that Executive may be subject to civil
process (including subpoenas issued by
legal authorities) that may require him
to provide testimony regarding his
employment with the Company.
3.
Payments. (a) In furtherance of the Company's obligations to
Executive
under the Separation Agreement, the Company
shall continue Executive's base
salary as of the Termination Date
($490,000), subject to all applicable
deductions (including those contemplated by
Section 7 below), for a period which
shall end twelve (12) months from the
Termination Date. Said base salary shall
be payable bi-monthly on the Company's
usual dates for salary payments
commencing on the first such date after the
Termination
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Date. In consideration of the Executive's
entering into this Agreement, the
Company shall also: a) continue payment of
Executive's base salary as of the
Termination Date for an additional twelve
(12) months beyond the period set
forth in the immediately preceding
sentence, subject to all applicable
deductions (including those contemplated by
Section 7 below), payable bi-monthly
as aforesaid; and b) make a one-time lump
sum cash payment to Executive within
five business days after the Effective Date
(as defined in Section 12) of
$250,000, subject to all applicable
deductions (including those contemplated by
Section 7 below).
(b) This
payment and the other benefits and payments provided for in
this
Agreement constitute the entire obligation
of the Company, represent full and
complete satisfaction by the Company of all
obligations under the Executive's
Employment Related Agreements, and
constitute full and complete settlement of
any claim under law or equity that
Executive might otherwise assert against the
Company for compensation, benefits or
remuneration of any form, on otherwise.
4.
Benefits and Stock Awards. From and after the Termination Date,
and
except as specifically set forth herein.
Executive shall not be eligible for any
Company benefits or perquisites, and shall
no longer be eligible to participate
in any Company benefit program or plan,
except as expressly set forth below:
(a) The
Company shall for a period of twenty four (24) months following
the Termination Date, or until Executive's
earlier death, and subject to
continued employee contributions at levels
equal to those existing as of the
Termination Date, continue to provide
Executive with basic life, accidental
death and disability insurance coverage
("Life Insurance Coverage") and health
insurance (medical, dental and vision)
coverage ("Health Insurance Coverage") in
effect as of the Termination Date.
Thereafter, the Company will respect
Executive's rights, if any, to continued
coverage at his own expense under the
Consolidated Omnibus Budget Reconciliation
Act (COBRA) or other applicable laws.
In lieu of the foregoing, Executive may
elect to participate in the Company's
retirement benefits program, as more fully
set forth in Exhibit B.
(b) In the
event that Executive commences other employment with a
successor employer ("new employment")
during the period in which the Company is
obligated to continue Life Insurance
Coverage or Health Insurance Coverage under
subsection (a) above, the Company may
offset such obligations by any coverage
which Executive receives during the
applicable continuation period from a
successor employer, so long as the
aggregate coverage (from the Company and the
successor employer) is substantially and
financially comparable to the benefits
and coverage provided by the Company as of
the Termination Date; provided that
nothing contained herein shall limit any
continuation of coverage required by
law. Executive shall notify the Company
promptly of his new employment and shall
provide only such information as shall be
required to determine the appropriate
coverage in accordance with this
subsection.
(c)
Executive's account under Company's 401(k) plan shall be treated
in
accordance with that plan.
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(d) (i)
The Company shall defend and hold Executive harmless to the
fullest extent permitted by applicable law
in connection with any claim, action,
suit, investigation or proceeding arising
out of or relating to performance by
Executive of services for, or action of
Executive as a director, officer or
employee of the Company prior to the
Termination Date. Expenses incurred by
Executive in defending such a claim,
action, suit or investigation or criminal
proceeding shall be paid by the Company in
advance of the final disposition
thereof upon the receipt by the Company of
an undertaking by or on behalf of
Executive to repay said amount unless it
shall ultimately be determined that
Executive is entitled to be indemnified
hereunder.
(ii) The
Company shall also maintain such director and officer liability
insurance
coverage for Executive for any claims that may be made against
Executive
with respect to his service as a director or officer of the
company
for claims arising out of conduct on or before the Termination
Date.
(e) Executive
hereby represents and confirms that he has executed and is
bound by the provision of each of the
Amendments to Restricted Stock Agreements
dated as of August 5, 2003 (the
"Amendments, copies of each of which, under
cover letter from the Company and as
executed on behalf of the Company, are
attached as Exhibit A hereto, relating to
restricted stock grants made to
Executive on April 19, 2001, April 4, 2002,
September 11, 2002 and April 15,
2003. Executive's entitlement to any vested
stock options and restricted stock
shall be exercised in accordance with the
applicable Stock Option Plans, Stock
Option Agreements and Restricted Stock
Agreements, including any amendments
thereto. All unvested stock options will be
forfeited as of the
