MUTUAL SETTLEMENT AND RELEASE
AGREEMENT
THIS MUTUAL SETTLEMENT AND RELEASE AGREEMENT
(the “Agreement”) is made and entered into as of this
8 th
day of May, 2009, by and between
CHROMCRAFT REVINGTON, INC., a Delaware corporation (the
“Company,” as further defined herein), and RICHARD J.
GARRITY, a resident of the State of North Carolina (the
“Executive,” as further defined herein);
WHEREAS, the Executive previously served as a
Senior Vice President of the Company; and
WHEREAS, the Company and the Executive are
parties to an Employment Agreement dated March 22, 2007 (the
“Employment Agreement”); and
WHEREAS, the Company and the Executive desire to
enter into this Agreement to memorialize their mutual understanding
and agreement with respect to any and all matters in dispute
between them relating to the performance of the Executive’s
duties for the Company, as well as to memorialize the severance
payments and certain other amounts to be paid by the Company to the
Executive;
NOW, THEREFORE, in consideration of the
foregoing recitals, the mutual agreements and obligations contained
herein, the payments contemplated hereby and for other good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Company and the Executive hereby agree as
follows:
Section 1 . Payments . The Company agrees to make
the following payments to the Executive:
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(a)
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a lump sum payment of $48,408.50,
payable within three (3) business days following the
expiration of the Revocation Period (as hereinafter defined) so
long as the Executive has not exercised his limited right of
revocation as provided in Section 3 hereof (such payment
constitutes a payment of $45,000, plus $3,408.50 for reimbursement
of premiums actually paid by the Executive associated with four (4)
months of COBRA continuation coverage);
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(b)
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a lump sum payment of $5,000 for
certain attorneys fees of the Executive, payable within three
(3) business days following the expiration of the Revocation
Period (as hereinafter defined) so long as the Executive has not
exercised his limited right of revocation as provided in
Section 3 hereof; and
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(c)
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subject to the remaining provisions
of this Section 1, up to $835 per month for eight
(8) months for reimbursement of the monthly premiums actually
paid by the Executive for continuation coverage under the
Company’s group health insurance plan in accordance with the
Consolidated Omnibus Budget Reconciliation Act of 1986, as amended
(“COBRA”). Such reimbursement shall be paid within
fifteen (15) days following the Executive’s payment of
each monthly premium for such coverage; provided ,
however , that the Executive shall provide appropriate
written proof to the Company of his payment of each such monthly
premium, and the Company shall then confirm the payment of such
premium with the health insurer, before any reimbursement to the
Executive shall be made.
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The payments described in Section 1(a),
other than the reimbursement for the COBRA premiums, shall be
subject to all required and/or applicable tax withholdings, and the
Company shall issue a Form W-2 to the Executive for all such
payments. The Company shall issue a Form 1099 to the Executive
by reason of the payment described in Section 1(b).
With respect to the lump sum payment described
in Section 1(a), the Executive hereby directs the Company to
withhold the following amounts related to the Executive’s
federal and state income tax obligation: $4,500 for federal income
taxes and $2,000 for state income taxes.
The reimbursements described in Section 1(c)
shall be paid until the first of the following to occur:
(i) December 29, 2009, or (ii) the date that the
Executive determines that he no longer desires continuation
coverage pursuant to COBRA under the Company’s group health
insurance plan, or (iii) the date that the Executive becomes
eligible to receive health insurance coverage from another
employer.
The Company’s obligation to make any of
the reimbursements described in Section 1(c) shall terminate
immediately without reinstatement of any obligation of the Company
to resume paying or reimbursing the Executive hereunder if the
Executive breaches any of the provisions of the Employment
Agreement that survive a termination of his employment (including,
but not limited to, any of the provisions of Sections 6, 7, 8
or 9 of the Employment Agreement). In addition, in the event that
the Executive breaches any of such provisions, then he shall
immediately repay to the Company all amounts paid or reimbursed to
him pursuant to this Section 1 plus all costs, expenses and
reasonable attorneys fees of the Company incurred in pursuing the
collection of such amounts and the enforcement of such provisions;
provided , however , that any such repayment by the
Executive to the Company shall not prevent, limit or affect the
Company’s ability to enforce any of such provisions against
the Executive.
Section 2 . Effective Date . This Agreement is
binding upon and effective as to the Company and the Executive on
the date hereof (the “Effective Date”), subject to the
Executive’s limited right of revocation as provided in
Sections 3(a)(ii) and 3(a)(iii) hereof; provided ,
however , that the Company shall not be obligated to pay any
of the amounts or make any of the reimbursements set forth in
Section 1 of this Agreement if Executive exercises such
limited right of revocation.
Section 3 . Mutual Release of Claims . As a
material inducement to the parties to enter into this Agreement and
in consideration of the mutual releases set forth herein, the
Company and the Executive provide the releases as set forth in this
Section to the fullest extent permitted by law.
(a) Release of the Company by the
Executive . The Executive, for and on behalf of himself and his
spouse, children, heirs, executors, administrators,
representatives, attorneys, insurers, successors and assigns
(hereinafter referred to individually and collectively in this
Section 3(a) as the “Executive”), hereby COVENANTS NOT
TO SUE or make any demand or claim against and hereby irrevocably,
unconditionally and forever waives with respect to, releases and
discharges the Company, its subsidiaries and affiliates, its and
their respective predecessors and successors, its and their
respective former, present and/or future stockholders, members,
owners, partners, principals, directors, officers, employees,
managers, fiduciaries, administrators, insurers, attorneys,
insurers, assigns, representatives and agents, and all parties
acting by, through or under or in concert with any of them
(collectively, the “Company Released Parties”) for,
from and/or relating to any and all complaints, claims, demands,
liabilities, obligations, debts, charges, expenses, damages, causes
of actions, rights of actions, suits, proceedings, promises,
agreements and compensation of any nature whatsoever (including,
but not limited to, attorneys’ fees, interest and costs),
whether known or unknown, matured or unmatured, suspected or
unsuspected, at law or in equity, or otherwise, that exist as of,
or may have existed prior to, the Effective Date. Without limiting
the generality of the foregoing, the Executive understands and
agrees that this
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release
includes and constitutes a complete waiver, discharge and release
by the Executive in all capacities (including, but not limited to,
as a stockholder, officer, employee, individual or otherwise) of
any and all possible claims, suits and actions against each of the
Company Released Parties based upon, arising out of or in any
manner related to the Executive’s employment, or separation
from employment, with the Company and any of its subsidiaries or
affiliates; any and all matters arising or learned prior or
subsequent to the Executive’s last day of employment with the
Company; any claim or defense that the Executive could assert
against any of the Company Released Parties relating to any facts
or evidence learned prior or subsequent to the Executive’s
last day of employment with the Company; all employee benefits,
salary and other compensation from the Company or any of its
subsidiaries or affiliates; all payments or claims under the
Company’s Exec-U-Care plan or program; all expenses incurred
while employed by the Company; the Employment Agreement; the
Company’s 2007 Executive Incentive Plan (including the short
term incentive program or opportunities and the long term incentive
program or opportunities under the 2007 Executive Incentive Plan);
the Company’s Short Term Executive Incentive Plan (as amended
and restated effective January 1, 2002); the Company’s
Long Term Executive Incentive Plan (as amended and restated
effective January 1, 2002); any plan, policy, program or
promise of compensation or employee benefits from any of the
Company Released Parties; any cash bonus (discretionary or
otherwise) from the Company and any of its subsidiaries or
affiliates; any award of restricted stock, stock options or other
stock- or equity-based compensation; the Executive’s
employment with or termination of employment by the Company or any
of its subsidiaries or affiliates; wrongful termination or
discharge; breach of contract; breach of good faith or fair
dealing; infliction of emotional distress; discrimination based on
age, race, sex, religion, national origin, disability, veterans
status, sexual orientation, gender identity or any other claim of
employment discrimination; claims arising under the following laws
and amendments thereto, if any: the Civil Rights Act of 1866 (42
U.S.C. § 1981), Title VII of the Civil Rights Act of 1964, the
Americans with Disabilities Act, the Age Discrimination in
Employment Act of 1967, the Federal Rehabilitation Act of 1973, the
Family and Medical Leave Act, the Fair Labor Standards Act, the
Older Workers Benefit Protection Act, and the Employee Retirement
Income Security Act of 1974; any other federal or state employment
law; any federal or state wage and hour laws; all other similar
federal, state or local laws, statutes, rules or regulations; and
all other tort or contract claims and other theories of recovery at
law, in equity or otherwise. Notwithstanding the foregoing, this
release does not affect, release or waive any claim or action by
the Executive (I) for enforcement of this Agreement,
(II) for payment of any vested benefits owed to him under the
Company’s employee stock ownership plan or its savings plan
in accordance with the terms of such plans, (III) under the
Company’s By-Laws or applicable Delaware law, as each may be
in effect from time to time, relating to the indemnification of
directors and officers, and (IV) for coverage under the
Company’s directors and officers liability insurance policy
as may be in effect from time to time; provided ,
however , that with respect to any claim or action under
(III) or (IV) above, such indemnification and insurance
coverage shall be provided in accordance with the provisions of the
By-Laws, applicable Delaware law and insurance policy as may be in
effect from time to time and only so long as the Executive has
satisfied all standards of conduct, conditions and other
requirements necessary for such indemnification and insurance
coverage.
(i) The Executive acknowledges that the
Company has advised the
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