Exhibit 10.31
SEVERANCE PAY AGREEMENT AND
RELEASE OF ALL CLAIMS
This Transition & Severance
Pay Agreement and Release of All Claims (“Agreement”)
is entered into between Sarah R. Coffin (“Associate” or
“You”) and Hexion Specialty Chemicals, Inc.
(“Company”).
Until February 15, 2009
(“Termination Date”), you will be an active employee of
the Company and remain on the Company’s payroll. Accordingly,
you agree to perform all job-related duties and functions that may
be assigned to you from time-to-time by the Company;
Severance Payments
The Company agrees to pay you
$400,000 as severance. This amount is equal to fifty-two weeks
(52) weeks of your current base salary. Severance payments
will be made to you in bi-weekly installments, subject to all
applicable legal deductions and withholdings. Deductions for cash
advances and other monies due the Company will be made from these
payments.
The severance period for which these
severance payments will be made will begin February 16, 2009
and end on February 15, 2010 (“Severance
Period”).
Transition Payment
In consideration for the final
settlement of the agreement, the company will pay you an additional
lump sum of $126,000 by February 20, 2009. The employee will
not be entitled to any other payments and all other entitlements
shall be considered forfeited.
Health Benefit
Continuation
The Company shall pay you on or as
soon as practicable after February 16, 2009, a cash lump sum
intended to cover the approximate cost of the Company’s
portion of the premiums necessary to continue your medical care
coverage pursuant to the Consolidated Omnibus Budget Reconciliation
Act (“ COBRA ”), for a period of twenty-six
(26) weeks following February 16, 2009, at the same or
reasonably equivalent coverage for you (and, if applicable, your
eligible dependents) as in effect immediately prior to the
Termination Date. You may elect to continue health care coverage
pursuant to COBRA (up to the maximum period of COBRA coverage);
provided that you shall be required to pay any and all premiums
associated therewith directly to the third party COBRA
Administrator.
The Company will gross-up this
payment to allow for Federal Income Tax withholding (generally
withheld at a rate of 25%). However, due to the complexity of the
various state and local taxing jurisdictions, the amount of this
lump sum payment may not cover all required tax withholdings. This
payment will be based on the COBRA rates in effect at the time of
your separation. You will be responsible for any subsequent
increases in COBRA rates.
If you elect to extend your
healthcare coverage through COBRA:
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Your coverage will be retroactive
to your termination date
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You will be sent monthly bills
for your COBRA premiums from the third party COBRA
Administrator.
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The Severance Period is
considered to be part of the 18 months COBRA
eligibility.
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Vacation
You will receive payment for all
accrued, but unused vacation through your termination date. After
this date, you will not accrue or earn any additional paid
vacation.
Outplacement
Support
The Company has arranged, at its own
expense, a program of 12 months Executive outplacement support for
you. Additional information on these services will be provided to
you in a separate attachment.
All Other Company Sponsored
Benefit Plans
Unless specified in this Agreement,
you will cease participation in and/or accruing benefits under
Company sponsored benefit plans as of your termination
date.
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Eligibility
for Considerations: You
understand that, to be eligible for any of the considerations under
this Agreement, you must be actively employed and working through
the date on which the Company releases you from work. You may not
terminate before then or be unavailable for active work due to
leave status (disability, workers’ compensation, or personal)
on your termination date. Should you be on such leave at your
termination date, you will be covered by the terms and conditions
of that particular status for its duration.
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Release of All
Claims: In exchange for
the monies and benefits given to you under this Agreement, you give
up the right to bring any claims whatsoever against the Company
that relate to your job, termination from your job or the severance
and other benefits paid to you under this Agreement and Pay. The
claims that you are giving up include, but are not limited to,
claims under the Age Discrimination in Employment Act, as amended
(“ADEA”), Title VII of the Civil Rights Act of 1964, as
amended (“Title VII”), the Civil Rights Act of 1966, as
amended, the Civil Rights Act of 1991, the Americans with
Disabilities Act (“ADA”), the Equal Pay Act, as
amended, the Family and Medical Leave Act, the National Labor
Relations Act, as amended, the Fair Labor Standards Act, as
amended, the Worker Adjustment and Retraining Notification
(“WARN”) Act, the Employee Retirement Income Security
Act (“ERISA”), as amended, any and all State Workers
Compensation claims of which the Company was not notified and that
were not filed prior to your Termination Date, and all other
federal, state or local laws regarding rights or claims relating to
employment and common law, including but not limited to, any claim
for breach of an oral, implied or written employment contract;
negligent or intentional misrepresentations; wrongful
dis
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