EXHIBIT 10
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EXECUTION COPY
SEPARATION
AGREEMENT
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SEPARATION AGREEMENT ("Agreement"), dated as of October 16,
2005 between Newell
Rubbermaid Inc., a Delaware corporation (the
"Company"), and Joseph
Galli, Jr. ("Executive"), a citizen of the
State of Maryland.
WHEREAS Executive has resigned from all of his positions
with the Company and its
Board of Directors (the "Board") and any
affiliate of the Company and
its board (the "Resignation"); and
WHEREAS the parties wish to document the terms and
conditions pertaining to the
Resignation;
NOW, THEREFORE, in consideration of the mutual promises and
agreements set forth herein,
and other good and valuable
consideration, the receipt
of which are hereby acknowledged, the
Company and Executive hereby
agree as follows:
Section 1.
RESIGNATION
Executive hereby confirms his Resignation, effective as of
October 16, 2005 (the
"Resignation Date"), from all of his positions
with the Company, the Board,
any affiliate of the Company and all
boards of directors of such
affiliates, and agrees to execute and
deliver any and all further
documentation reasonably requested by the
Company in order to evidence
and effect the Resignation.
Section 2. SEPARATION
PAYMENTS
The Company shall pay Executive, subject to his compliance
with Sections 3, 5, 6, 7, 10
and 12 hereof, the following amounts:
(a) CASH SEVERANCE
Executive shall receive a total amount of cash equal to two
times his annual rate of
salary immediately prior to the Resignation
Date (the "Cash Severance
Amount"). The Company
shall pay 25% of the
Cash Severance Amount to
Executive on the first day of the seventh
month following the
Resignation Date, and thereafter shall immediately
commence payment of the
remainder of the Cash Severance Amount in
equal semi-monthly
installments in accordance with the Company's
payroll procedures, and each
such installment payment shall equal 1/48
of the Cash Severance
Amount, until the Cash Severance Amount has been
paid out in full.
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(b) 2005 BONUS
Executive shall receive a 2005 annual bonus in an amount
equal to 120.6% of his
annual rate of salary immediately prior to the
Resignation Date, to be
payable on the eighth day following
Executive's execution of
this Agreement.
(c) STOCK OPTIONS AND
RESTRICTED STOCK
(i) Any options to
purchase stock of the Company held by
Executive immediately prior to the Resignation Date shall
continue to vest in accordance with their normal vesting
schedules, until three years after the Resignation Date, as if
Executive had remained employed by the Company; provided that
such options may only be exercised during calendar year 2008
and
provided further that in the event of the occurrence of a
change
in the ownership or effective control of the Company, or in the
ownership of a substantial portion of the assets of the
Company,
as described in Section 409A(a)(2)(A)(v) of the Internal
Revenue
Code of 1986, as amended (the "Code") and the regulations and
guidance thereunder (a "Change in Control") prior to 2008, the
options that would have become vested prior to the third
anniversary of the Resignation Date (including those previously
vested) shall only be exercisable on the date of the Change in
Control. Any options
that would have remained unvested on the
third anniversary of the Resignation Date shall immediately be
cancelled and
shall be of no further force and effect.
(ii) Restricted shares of stock of the Company held by
Executive immediately prior to the Resignation Date shall
continue to vest and become free of all restrictions in
accordance with their normal vesting schedules, as if Executive
had remained employed by the Company until the second
anniversary
of the Resignation Date; provided that any such restricted
shares
that would have vested prior to the second anniversary of the
Resignation Date shall become fully vested upon a Change in
Control that occurs prior to such second anniversary. Any
additional restricted shares not becoming vested pursuant to
the
preceding sentence shall immediately be cancelled and shall be
of
no further force and effect.
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(d) BENEFITS
(i) (A) Executive
shall receive any and all benefits
accrued under any deferred compensation or qualified or non-
qualified pension plan in which he currently participates
(other
than any severance plan) in accordance with, and subject to,
the
terms thereof; provided that no such benefits shall be paid
prior
to the first date on which they would not be subject to the tax
imposed by Section 409A of the Code; and provided further that
Executive's benefits under the Company's SERP will be paid on
the
second anniversary of the Resignation Date if Executive
complies
with the Sections of this Agreement set forth in the beginning
of
Section 2 hereof through December 31, 2006.
(B) Executive shall receive, in addition, $775,000,
payable on the eighth day following Executive's execution of
this
Agreement, as an additional retirement benefit.
(ii) For 24 months after the Resignation Date, Executive and
his spouse and eligible dependents shall continue to be covered
by medical reimbursement plans in which he participated
immediately prior to the Resignation Date, as if he had
continued
to be an active employee of the Company, and the Company shall
continue to pay the costs of such coverage under such plans on
the same basis as is applicable to active employees covered
thereunder; provided that, if participation in any one or more
of
such plans is not possible under the terms thereof, the Company
shall provide substantially identical benefits or, at
Executive's
election, reimburse Executive for his cost of obtaining
comparable coverage from a third party insurer. Such coverage
shall cease if and when Executive obtains employment with
another
employer during such 24-month period and becomes eligible for
medical coverage provided by his new employer. If at the end of
such 24-month period, Executive or his spouse or eligible
dependents are covered under any plan that is a group health
plan
as defined in Title I, Part 6 of the Employee Retirement Income
Security Act of 1974 ("COBRA"), the last day of the 24-month
period shall be considered a "qualifying event" as such term is
defined in COBRA, Executive and his spouse and eligible
dependents shall be eligible for continued benefits pursuant to
COBRA, and Executive shall be responsible for paying the full
cost of such
coverage.
(iii) Executive shall
be entitled to payment for any
accrued but unused vacation in accordance with the Company's
policy in effect on the Resignation Date. Executive shall not be
entitled to receive any payments or other compensation
attributable to vacation he would have earned had his
employment
continued thereafter, and Executive waives any right to receive
such compensation.
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(iv) The Company shall reimburse Executive for up to
$100,000 in outplacement expenses, upon submission by Executive
of documentation of such outplacement expenses.
(v) Executive shall be
entitled to reimbursement for
reasonable business and fringe benefit expenses incurred by him
prior to the Resignation Date in accordance with Company policy
in effect on the Resignation Date; however, Executive shall not
be entitled to reimbursement for fringe benefit expenses
incurred
after the Resignation Date, such as dues and expenses related
to
club memberships, automobile telephones, expenses for
professional services and other similar perquisites, nor shall
Executive have use of Company aircraft after the Resignation
Date.
(vi) The Company shall, on the eighth day following
Executive's execution of this Agreement, cause Executive to
become the
owner of the Company car, mobile phone and computer
(after removal of any Company-related information) that he
currently has use of.
Section 3.
CONFIDENTIALITY, NON-COMPETITION AND NO-RAIDING
(a) EXECUTIVE
ACKNOWLEDGES AND AGREES THAT:
(i) he has been
employed by the Company as its Chief
Executive Officer ("CEO") and has been a member of the
Company's
Board of Directors, and that, in his capacity as CEO, Executive
was
responsible for overseeing and managing all of the Company's
domestic and international operations, and was entrusted with
and
has had access to the unique, confidential and secret
proprietary
business information and trade secrets, including but not
limited
to the Company's business priorities and strategic plans,
information about customer relationships and the Company's
personnel, financial and marketing information (including but
not
limited to information about costs, prices, profitability and
sales information not available outside the Company), secret
and
confidential plans for and information about new products or
existing products, and initiatives to address the Company's
competition;
(ii) the Company and its subsidiaries, affiliates and
divisions will suffer substantial and irreparable damage which
will not be compensable through money damages if Executive
should
enter into a Competitive Business (as hereinafter defined), or
if
Executive should divulge secret and confidential information of
the Company acquired by Executive in the course of his
employment
with the Company and service on its Board of Directors;
(iii) the provisions of this Agreement are reasonable and
necessary for the protection of Trade Secret (as hereinafter
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defined) information and the business of the Company and its
subsidiaries, affiliates, divisions and parent companies, and
the
stability of their workforces.
(b) TRADE SECRETS AND
CONFIDENTIALITY:
Executive agrees
that he will not, at any
time, so long as the pertinent information
rem
