Back to top

GENERAL RELEASE AND SEPARATION AGREEMENT BETWEEN SIMMONS BEDDING COMPANY, SIMMONS HOLDCO, INC., AND

Release Agreement

GENERAL RELEASE AND SEPARATION AGREEMENT BETWEEN SIMMONS BEDDING COMPANY, SIMMONS HOLDCO, INC., AND | Document Parties: Simmons Bedding Company | Simmons Company, Company | Simmons Holdco, Inc You are currently viewing:
This Release Agreement involves

Simmons Bedding Company | Simmons Company, Company | Simmons Holdco, Inc

. RealDealDocs™ contains millions of easily searchable legal documents and clauses from top law firms. Search for free - click here.
Title: GENERAL RELEASE AND SEPARATION AGREEMENT BETWEEN SIMMONS BEDDING COMPANY, SIMMONS HOLDCO, INC., AND
Governing Law: Georgia     Date: 6/8/2007

50 of the Top 250 law firms use our Products every day


 
GENERAL RELEASE AND SEPARATION AGREEMENT


Simmons Bedding Company, a corporation incorporated under the laws of the State of Delaware (“ Company ”), and Simmons Holdco, Inc., a corporation incorporated under the laws of the State of Delaware (“ Holdings ”) (collectively Company and Holdings are referred to herein as “Simmons”), and Gary S. Matthews (“ Executive ”) hereby enter into this General Release and Separation Agreement (“ Separation Agreement ”), contracting and agreeing as follows:

1.    Termination Date and Employment Agreement.   The parties agree that Executive's last day of employment with Company is May 25, 2007 (the “ Terminat ion Date ”).  Executive acknowledges and agrees that except as specifically set forth below, the Employment Agreement dated as of November 10, 2006 among Simmons Company, Company and Executive (the “ Employment Agreement ”) is terminated.  Executive further agrees that effective as of the Termination Date, he hereby resigns from all officer and director positions with Simmons and any of its subsidiaries and affiliates and agrees to sign any letters or other documents on or after such date effecting such resignations.

2.    Consideration Period.   Executive acknowledges that Executive was given this Separation Agreement to consider on May 9, 2007 and that Executive has twenty-one (21)   days to consider whether to sign this Separation Agreement.  Executive is hereby advised to consult a lawyer before signing this Separation Agreement.

3.    Effective Date.   Executive may accept this Separation Agreement only by signing, initialing and dating this Separation Agreement in the spaces provided and delivering the Separation Agreement to Simmons Bedding Company, Attention:  Kristen K. McGuffey, Executive Vice President and General Counsel, One Concourse Parkway, Suite 800, Atlanta, Georgia 30328, no later than Company’s normal close of business on the later of (a) the twenty-second (22 nd ) day following Executive’s receipt of this Separation Agreement or (b) if the twenty-second (22 nd ) day following receipt is a Saturday, Sunday or legal holiday in the State of Georgia, the next day that is not a Saturday, Sunday or legal holiday.  Time is of the essence as it pertains to this Section 3.The “Effective Date” of this Separation Agreement shall be seven (7) days after the date on which Executive signs and delivers the Separation Agreement pursuant to this Section, so long as Executive has not revoked the Separation Agreement pursuant to Section 4 below.

4.    Revocation.   Executive may revoke this Separation Agreement at any time within seven (7) days after signing and delivering it to Simmons.  If Executive elects to revoke, Executive must give notice of his decision in writing delivered to Simmons Bedding Company, Attention: Kristen K. McGuffey, Executive Vice President and General Counsel, One Concourse Parkway, Suite 800, Atlanta, Georgia 30328.  The notice shall be sent in a manner so that it will be received by Ms. McGuffey within seven (7) days of the date of Executive’s execution of this Separation Agreement.

5.    Separation Benefits.   Provided that Executive satisfies the conditions of this Separation Agreement and does not revoke this Separation Agreement, Company will do the following:

(a)    Pay to Executive his unpaid salary through the Termination Date.  Such amount will be paid at the next regular pay period after the Termination Date.

(b)    Pay to Executive the Annual Bonus due for fiscal year 2007, if any, in accordance with Sections 3.2 and 7.4(a) of his Employment Agreement.  Such amount will be paid to Executive as soon as practicable following the last day of the month in which the Termination Date occurs.

(c)    Pay to Executive the gross amount of $862,500, which equals eighteen (18) months of Executive’s current salary of $575,000 per year.  This amount, less legal deductions, will be paid in accordance with Executive’s current pay schedule for a period from May 25, 2007 through November 24, 2008 (the “ Severance Pay Period ”) provided that the first payment shall not be made until after the expiration of the revocation period, and which first payment will include any missed payments between the first payment due date and the expiration of the revocation period.

(d)    (i)           Executive and Executive’s Dependents (as defined below) may continue to participate in the Company’s medical, dental and vision plans at the same level of participation that was in effect immediately prior to the Termination Date through the earlier of (i) November 24, 2008, or (ii) the date on which the Executive commences other employment in connection with which the Executive is eligible to receive medical, dental and vision benefits substantially comparable to those made available by the Company (including self employment or engaging in an enterprise as a sole proprietor, member or partner).  Executive shall continue to pay for such coverage at the same rate or rates that apply from time to time to active employees for comparable coverage.  Notwithstanding the foregoing, if the benefit plan for which Executive is currently enrolled is no longer offered by Simmons, then Executive through November 24, 2008 will be eligible to participate in any plan offered to then-current Simmons’ associates.  Executive must pay Executive’s portion by deductions from Executive’s severance payments.  The 18 month period during which benefits under the Consolidated Omnibus Budget Reconciliation Act (aka COBRA) are available to Executive and his Dependants shall begin on the Termination Date and run concurrently with the benefits available under this Section 5(d)(i).

(ii)           For 2008, the new medical, dental and vision rates will be communicated to the Executive before December 31, 2007.  Executive is required to complete all necessary forms required during the 2008 open enrollment period.  Further, if Executive discontinues his coverage under the Company’s medical, dental or vision plans at any time, he will no longer be entitled to any of the benefits described in this Section 5(d) with respect to such plan after such date.
 
(iii)                      As used herein, a “Dependent” is a dependent of Executive enrolled and qualified in Simmons’ medical, dental and/or vision plans immediately prior to the Termination Date and will only continue to be a “Dependent” hereunder for as long as he or he continues to be qualified as outlined in the applicable health plan documents.  Simmons reserves the right from time to time to require proof from Executive that Executive’s Dependents are still considered qualified under the applicable health plan documents.

(iv)           Nothing contained herein shall give Executive any rights to any other Simmons sponsored benefits, including without limitation, long term disability, short term disability, and retirement contributions, except as permitted under those plans for retired associates.

(e)    Pay all verified and approved expense reports submitted by Executive to Company within two (2) weeks of the Termination Date in accordance with Company’s current policies, practices and procedures.

(f)    Executive agrees that if Executive subsequently engages in activities prohibited by Section 10 below, then the Company may thereafter immediately terminate and shall not be required to continue on behalf of the Executive or his Dependents any compensation provided for in this Section 5 other than those benefits that the Company may be required to maintain for the Executive under applicable law.  Except as expressly provided in this Section 5(f), the Company’s obligation to pay all compensation to Executive provided for in this Section 5 shall be absolute, and shall not be eliminated or otherwise diminished in any manner by reason of Executive’s hereafter commencing other employment or self-employment, or otherwise.

6.    Repurchase of Shares.

(a)    Class A Shares . Pursuant to Section 3.5(b)(i) of the Securityholders Agreement dated as of December 19, 2003 among Executive, Holdings (as successor to Simmons Company) and the other parties thereto (as amended to date the “ SH Agreement ”), Holdings exercises its right to repurchase the 4,195.33 Class A shares that Executive currently owns.  The Call Notice (as that term is defined in the SH Agreement) shall be deemed to have been given as of the Effective Date of this Separation Agreement.  The Call Closing (as that term is defined in the SH Agreement) will take place at One Concourse Parkway, Suite 800, Atlanta, Georgia 30328 on or before the 30th day after the Effective Date of this Separation Agreement and such shares will be repurchased at the then current Fair Market Value.

(b)    Class B Shares . Pursuant to Section 2(b) and 3(a) of the Restricted Stock Agreement dated as of December 1, 2006 by and between Executive and Holdings, as successor to Simmons Company (the “ RSA ”), the vesting of Executive’s Restricted Class B stock has terminated, and Holdings may now, or at such later date, as the case may be, exercise the following rights:

(i)           For the portion, if any, of Executive’s 3,333 Class B shares that may become Vested Shares pursuant to Section 2(b) of the RSA if Holdings meets the performance requirements for fiscal year 2007 as set forth in Section 2(a)(i) of the RSA (as such targets were adjusted in January 2007 in accordance with the terms of the RSA, which new targets are set forth on Exhibit A  hereto), Holdings may, in its sole discretion, exercise its right to repurchase any such vested shares on a date that is no earlier than 180 days after such shares become vested at the then current FMV.  For the portion, if any, of these shares that do not vest pursuant to the performance requirements for 2007, then Holdings will repurchase these unvested shares at Executive’s original purchase price of one penny per share within thirty (30) days of the Measurement Date in 2008.

(ii)  &n

SITE SEARCH

AGREEMENTS / CONTRACTS

Document Title:

Entire Document: (optional)

Governing Law:(optional)
 

CLAUSES

Search Contract Clauses >>

Browse Contract Clause Library>>

Close this window