Exhibit 10.2
RELEASE AND RESTRICTIVE COVENANT AGREEMENT
THIS RELEASE AND RESTRICTIVE COVENANT AGREEMENT ("Agreement") made and
entered into by and between SOUTHERN NUCLEAR OPERATING COMPANY, INC. (the
"Company") and WILLIAM GEORGE HAIRSTON III ("Employee").
W I T N E S S E T H
WHEREAS, Employee has been employed by the Company for approximately
thirty-seven (37) years;
WHEREAS, Employee is a highly compensated
employee of the Company and is a member of its management;
WHEREAS, the parties have agreed that Employee will terminate
employment with the Company no later than July 1, 2005;
WHEREAS, the parties desire to reach an accord and satisfaction of all
claims arising up to the date of this Agreement from Employee's employment and
agreement to terminate employment as set forth above, with appropriate releases;
and
WHEREAS, in order to be eligible for benefits under this Agreement, the
Employee must execute this Agreement no later than December 31, 2004 and allow
this Agreement to become effective;
NOW, THEREFORE, in consideration of the premises, and the agreements of
the parties set forth in this Agreement, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto, intending to be legally bound, hereby covenant and agree as
follows:
1. Eligibility for Consideration. In the event Employee (i) executes
this Agreement no later than December 31, 2004, and (ii) allows this Agreement
to become effective, the Company shall pay to Employee or his spouse or his
estate, as applicable, the amount described in Section 2 hereof pursuant to the
terms of such Section. Employee covenants and agrees that the consideration set
forth in Section 2 constitutes good and complete consideration for the release
contained in Section 3, those non-disclosure and non-interference obligations
under Sections 6, 7, 8, 9 and 10 hereof and all other obligations and covenants
of Employee contained herein, including, but not limited to, Section 5. Employee
agrees that this Agreement provides him certain benefits to which he would not
otherwise be entitled.
2. Consideration.
(a) In the event Employee satisfies the
requirements of Section 1 above, the Company
shall pay to Employee an amount equal to One
Million, Two Hundred Ninety-Four Thousand,
Nine Hundred Thirty-Seven Dollars and No
Cents ($1,294,937.00) ("Consideration")
pursuant to the terms of this Section.
(b) Except as provided in Section 2(c) below,
the Consideration shall be paid to Employee
in a lump sum as soon as administratively
practicable following the effective date of
this Agreement (as determined in accordance
with Section 26 hereof), but in no event
later than February 28, 2005.
(c) Notwithstanding the above, in the event
Employee dies after he satisfies the
requirements of Section 1 but before
receiving the Consideration pursuant to
Section 2(b) above, the Company shall pay
the unpaid Consideration to Employee's
spouse, if living, or if not, to the
Employee's estate, as soon as practicable
after Employee's death.
(d) In accordance with Section 20, Employee
shall be responsible for all state and
federal income taxes and his share of FICA
taxes owed on the Consideration, and Company
shall make appropriate withholding of these
amounts.
3. Release.
(a) In exchange for receiving the Consideration described in Section 2 of
this Agreement, the sufficiency of which is acknowledged, Employee hereby
knowingly, voluntarily and irrevocably waives, releases, discharges, dismisses
with prejudice, and withdraws all claims, complaints, suits, demands,
liabilities and causes of action of any kind whatsoever (whether known or
unknown, fixed or contingent) which Employee, his heirs, administrators,
executors, personal representatives and beneficiaries ever had, may have, or
claim to have against the Company, Southern Company, Southern Company Services,
Inc., and other current or former subsidiaries or affiliates of Southern
Company, and their past, present and future officers, directors, employees,
agents, insurers and attorneys (collectively, the "Releasees"), arising from or
relating to (directly or indirectly) Employee's employment or other events which
occurred as of the date of execution of this Agreement, including but not
limited to:
(i) claims for violations of Title VII of the
Civil Rights Act of 1964, the Age
Discrimination in Employment Act, the Fair
Labor Standards Act, the Civil Rights Act of
1991, the Americans With Disabilities Act,
the Equal Pay Act, the Civil Rights Act of
1866, the Family and Medical Leave Act, 42
U.S.C. ss. 1981, the National Labor
Relations Act, the Labor Management
Relations Act, Executive Order 11246,
Executive Order 11141, the Rehabilitation
Act of 1973, the Sarbanes-Oxley Act of 2002
or the Employee Retirement Income Security
Act;
(ii) claims for violations of any other federal
or state statute or regulation or local
ordinance;
(iii) claims for lost or unpaid wages,
compensation, or benefits, defamation,
intentional or negligent infliction of
emotional distress, assault, battery,
wrongful or constructive discharge,
negligent hiring, retention or supervision,
fraud, misrepresentation, conversion,
tortious interference, breach of contract,
or breach of fiduciary duty;
(iv) claims to benefits under any non-incentive
bonus, severance, workforce reduction, early
retirement, outplacement, or any other
similar type plan sponsored by the Company;
or
(v) any and all other claims under state law
arising in tort or contract.
(b) In signing this Agreement, Employee is not releasing any claims that
may arise under the terms of this Agreement or which may arise out of events
occurring after the date Employee executes this Agreement, except that Employee
understands, agrees and acknowledges that his employment with the Company will
terminate no later than July 1, 2005.
Employee is also not releasing claims to benefits that Employee is
already entitled to receive under The Southern Company Pension Plan, The
Southern Company Employee Stock Ownership Plan, The Southern Company Employee
Savings Plan or under any workers' compensation laws. However, Employee
understands and acknowledges that nothing herein is intended to or shall be
construed to require the Company to institute or continue in effect any
particular plan or benefit sponsored by Company and Company hereby reserves the
right to amend or terminate any of its benefit programs at any time in
accordance with the procedures set forth in such plans.
Nothing in this Agreement shall prohibit Employee from engaging in
protected activities under applicable law (including protected activities
described in Section 211 of the Energy Reorganization Act) or from
communicating, either voluntarily or otherwise, with any governmental agency
concerning any potential violation of the law.
(c) Employee represents that he has not assigned
or transferred, or purported to assign or
transfer, any claims or any portion thereof
or interest therein to any party prior to
the date of this Agreement.
(d) This Agreement shall not in any way be
construed as an admission by Company or
Employee of any improper actions or
liability whatsoever as to one another, and
each specifically disclaims any liability to
or improper actions against the other or any
other person, on the part of itself or
himself, its or his employees or agents.
4. Publicity; No Disparaging Statement. Except as otherwise provided in
Section 13 hereof, Employee and the Company covenant and agree that they shall
not engage in any communications which shall disparage one another or interfere
with their existing or prospective business relationships, as determined by the
Chairman, Chief Executive Officer and President of Southern Company (hereinafter
"Southern CEO").
5. No Employment. Employee agrees that he shall not seek re-employment as
an employee, temporary employee, leased employee or independent contractor with
the Company or the Southern Company or any of its subsidiaries or affiliates
(collectively, for purposes of this Section 5, "The Southern Company System"),
for a period of twenty-four (24) months following the date Employee terminates
his employment with the Company (the "Termination Date"). The Company or any
member of The Southern Company System shall not rehire the Employee as an
employee, temporary employee, leased employee or independent contractor for a
period of twenty-four (24) months following the Employee's Termination Date,
unless an exceptional business reason exists for rehiring the Employee and the
Southern CEO or designee approves of such rehiring.
6. Business Protection Provision Definitions.
(a) Preamble. As a material inducement to the
Company to enter into this Agreement, and
its recognition of the valuable experience,
knowledge and proprietary information
Employee gained from his employment with the
Company, Employee warrants and agrees he
will abide by and adhere to the following
business protection provisions in Sections
6, 7, 8, 9 and 10 herein.
(b) Definitions. For purposes of Sections 6, 7,
8, 9 and 10 herein, the following terms
shall have the following meanings:
(i) "Competitive Position" shall mean any
employment, consulting, advisory,
directorship, agency, promotional or
independent contractor arrangement between
the Employee and any person or Entity
engaged wholly or in material part in the
business that the Company is engaged in
(the "Business") whereby the Employee is
required to or does perform services on
behalf of or for the benefit of such person
or Entity which are substantially similar
to the services Employee participated in
or directed while employed by the Company,
The Southern Company or any of their
respective affiliates (collectively the
"Southern Entities").
(ii) "Confidential Information" shall mean the
proprietary or confidential data,
information, documents or materials
(whether oral, written, electronic or
otherwise) belonging to or pertaining to
the Company or other Southern Entities,
other than "Trade Secrets" (as defined
below), which is of tangible or intangible
value to any of the Southern Entities and
that is not generally known to the public
or the competitors of the Southern
Entities but is known only to the
Southern Entities and those of their
employees, independent contractors or
agents to whom such information must be
confided for business purposes, including
but not limited to: (A) any items that
any of the Southern Entities have marked
"CONFIDENTIAL" or some similar
designation or are otherwise identified
as being confidential; (B) all
non-public information known by or in
the possession of Employee related to or
regarding any regulatory proceedings
involving or related to the Southern
Entities; and (C) information regarding
the Southern Entities' customers, suppliers,
partners and affiliates.
(iii) "Entity" or "Entities" shall mean any
business, individual, partnership, joint
venture, agency, governmental agency, body
or subdivision, association, firm,
corporation, limited liability company or
other entity of any kind.
(iv) "Territory" shall include the States of
Georgia, Alabama, Mississippi or Florida.
(v) "Trade Secrets" shall mean information or
data of or about any of the Southern
Entities, including, but not limited to,
technical or non-technical data,
formulas, patterns, compilations,
programs, devices, methods, techniques,
drawings, processes, financial data,
financial plans, product plans or lists of
actual or potential customers or suppliers
that: (A) derives economic value, actual
or potential, from not being generally
known to, and not being readily
ascertainable by proper means by, other
persons who can obtain economic value
from its disclosure or use; and (B) is the
subject of efforts that are reasonable
under the circumstances to maintain its
secrecy. The Employee agrees that trade
secrets include non-public information
related to the rate making process of
the Southern Entities and any other
information which is defined as a "trade
secret" under applicable law.
(vi) "Work Product" shall mean all tangible work
product, property, data, documentation,
"know-how," concepts or plans, inventions,
improvements, techniques, processes or
information or materials that were
conceived, discovered, created, written,
revised or developed by Employee pursuant to
his employment with the Company.
7. Nondisclosure: Ownership of Proprietary Property.
(a) In recognition of the need of the Company to protect its legitimate
business interests, Confidential Information and Trade Secrets, Employee hereby
covenants and agrees that Employee shall regard and treat Trade Secrets and all
Confidential Information as strictly confidential and wholly-owned by the
Company and shall not, for any reason, in any fashion, either directly or
indirectly, use, sell, lend, lease, distribute, license, give, transfer, assign,
show, disclose, disseminate, reproduce, copy, misappropriate or otherwise
communicate any such item or information to any third party or Entity for any
purpose other than in accordance with this Agreement or as required by
applicable law: (i) with regard to each item constituting a Trade Secret, at all
times such information remains a "trade secret" under applicable law, and (ii)
with regard to any Confidential Information, for a period of three (3) years
following Employee's Termination Date (hereafter the "Restricted Period").
(b) Employee shall exercise best efforts to ensure the continued
confidentiality of all Trade Secrets and Confidential Information, and he shall
immediately notify the Company of any unauthorized disclosure or use of any
Trade Secrets or Confidential Information of which Employee becomes aware.
Employee shall assist the Company, to the extent necessary, in the protection of
or procurement of any intellectual property protection or other rights in any of
the Trade Secrets or Confidential Information.
(c) All Work Product shall be owned exclusively by the Company. To the
greatest extent possible, any Work Product shall be deemed to be "work made for
hire" (as defined in the Copyright Act, 17 U.S.C.A. ss. 101 et seq., as
amended), and Employee hereby unconditionally and irrevocably transfers and
assigns to the Company all right, title and interest Employee currently has or
may have by operation of law or otherwise in or to any Work Product, including,
without limitation, all patents including extensions, copyrights, trademarks
(and the goodwill associated therewith), trade secrets, service marks (and the
goodwill associated therewith) and other intellectual property rights. Employee
agrees to execute and deliver to the Company any transfers, assignments,
documents or other instruments which the Company may deem necessary or
appropriate, from time to time, to protect the rights granted herein or to vest
complete title and ownership of any and all Work Product, and all associated
intellectual property and other rights therein, exclusively in the Company.
(d) Employee represents and agrees that he will keep all terms and
provisions of this Agreement completely confidential, except for possible
disclosures to his legal advisors or to the extent required by law, and Employee
further agrees that he will not disclose the terms, provisions or information
contained in or concerning this Agreement to anyone, including, but not limited
to, any past, present, or prospective employee or applicant for employment with
the Company. Employee agrees that he may only disclose to future, potential
employers of Employee that he participates in a Release and Restrictive Covenant
Agreement with the Company which imposes certain restrictions on him.
8.Non-Interference With Employees.
Employee covenants and agrees that during the Restricted
Period he will not, either directly or indirectly, alone or in conjunction with
any other person or Entity: (A) actively recruit, solicit, attempt to solicit,
or induce any person who, during such Restricted Period, or within one year
prior to the Termination Date, was an exempt employee of the Company or any of
its subsidiaries, or was an officer of any of the other Southern Entities to
leave or cease such employment for any reason whatsoever; or (B) hire or engage
the services of any such person described in Section 8(A) in any business
substantially similar or competitive with that in which the Southern Entities
were engaged during his employment.
9. Non-Interference With Customers.
(a) Employee acknowledges that in the course of employment, he has learned about
Company's business, services, materials, programs and products and the manner in
which they are developed, marketed, serviced and provided. Employee knows and
acknowledges that the Company has invested considerable time and money in
developing its programs, agreements, offices, representatives, services,
products and marketing techniques and that they are unique and original.
Employee further acknowledges that the Company must keep secret all pertinent
information divulged to Employee and Company's business concepts, ideas,
programs, plans and processes, so as not to aid Company's competitors.
Accordingly, Company is entitled to the following protection, which Employee
agrees is reasonable:
(b) Except as otherwise approved by the Southern CEO, Employee covenants and
agrees that for a period of two (2) years following the Termination Date, he
will not, on his own behalf or on behalf of any person or Entity, solicit,
direct, appropriate, call upon, or initiate communication or contact with any
person or entity or any representative of any person or entity, with whom
Employee had contact during his employment, with a view toward the sale or the
providing of any product, equipment or service sold or provided or under
development by Company during the period of two (2) years immediately preceding
the date of Employee's termination. The restrictions set forth in this Section
shall apply only to persons or entities with whom Employee had actual contact
during the two (2) years prior to termination of employment with a view toward
the sale or providing of any product, equipment or service sold or provided or
under development by Company.
10. Non-Interference With Business.
(a) Employee and Company expressly covenant and agree that the scope,
territorial, time and other restrictions contained in this entire Agreement
constitute the most reasonable and equitable restrictions possible to protect
the business interest of the Company given: (i) the business of the Company;
(ii) the competitive nature of the Company's industry; and (iii) that Employee's
skills are such that he could easily find alternative, commensurate employment
or consulting work in his field which would not violate any of the provisions of
this Agreement. The Employee further acknowledges that the payment described in
Section 2 is also in consideration of his covenants and agreements contained in
Sections 6 through 10 hereof.
(b) Except as otherwise approved by the Southern CEO, Employee covenants and
agrees to not obtain or work in a Competitive Position within the Territory for
a period of two (2) years from the Termination Date.
11. Return of Materials. Upon the Employee's termination, or at any point after
that time upon the specific request of the Company, Employee shall return to the
Company all written or descriptive materials of any kind belonging or relating
to the Company or its affiliates, including, without limitation, any originals,
copies and abstracts containing any Work Product, intellectual property,
Confidential Information and Trade Secrets in Employee's possession or control,
except as otherwise approved by the Southern CEO.
12. Cooperation. The parties agree that as a result of Employee's duties and
activities during his employment, Employee's reasonable availability may be
necessary for the Company to meaningfully respond to or address actual or
threatened litigation, or government inquiries or investigations, or required
filings with state, federal or foreign agencies (hereinafter "Company Matters").
Upon request of the Company, and at any point following his termination of
employment, Employee will make himself available to the Company for reasonable
periods consistent with his future employment, if any, by other Entities and
will cooperate with its agents and attorneys as reasonably required by such
Company Matters. The Company will reimburse Employee for any reasonable
out-of-pocket expenses associated with providing such cooperation.
13. Confidentiality and Legal Process. Employee represents and agrees that he
will keep the terms, amount and fact of this Agreement confidential and that he
will not hereafter disclose any information concerning this Agreement to anyone
other than his personal agents, including, but not limited to, any past,
present, or prospective employee or applicant for employment with Company.
Notwithstanding the foregoing, nothing in this Agreement is intended to prohibit
Employee from performing any duty or obligation that shall arise as a matter of
law. Specifically, Employee shall continue to be under a duty to truthfully
respond to any legal and valid subpoena or other legal process. This Agreement
is not intended in any way to proscribe Employee's right and ability to provide
information to any federal, state or local government in the lawful exercise of
such governments' governmental functions.
14. Successors And Assigns; Applicable Law. This Agreement may not be assigned
by Employee without the prior written consent of Company, and any attempted
assignment not in accordance herewith shall be null and void and of no force or
effect. This Agreement shall be binding upon and inure to the benefit of
Employee and his heirs, administrators, representatives, executors, successors
and permitted assigns, and shall be binding upon and inure to the benefit of the
Company and its officers, directors, employees, agents, shareholders, parent
corporation and affiliates, and their respective predecessors, successors,
assigns, heirs, executors and administrators and each of them, and to their
heirs, administrators, representatives, executors, successors and assigns. This
Agreement shall be construed and interpreted in accordance with the laws of the
State of Alabama, United States of America (without giving effect to principles
of conflicts of laws).
15. Complete Agreement. This Agreement shall constitute the full and complete
Agreement between the parties concerning its subject matter and fully supersedes
any and all other prior agreements or understandings between the parties
concerning the subject matter hereof. This Agreement shall not be modified or
amended except by a written instrument signed by both Employee and an authorized
representative of the Company.
16. Severability. The unenforceability or invalidity of any particular provision
of this Agreement shall not affect its other provisions, and to the extent
necessary to give such other provisions effect, they shall be deemed severable.
The judicial body interpreting this Agreement shall be authorized and instructed
to rewrite any of the sections which are enforceable as written in such a
fashion so that they may be enforced to the greatest extent legally possible.
Employee acknowledges and agrees that the covenants and agreements contained in
this Agreement, including, without limitation, the covenants and agreements
contained in Sections 6, 7, 8, 9 and 10, shall be construed as covenants and
agreements independent of each other or any other contract between the parties
hereto and that the existence of any claim or cause of action by Employee
against Company, whether predicated upon this Agreement or any other contract,
shall not constitute a defense to the enforcement by Company of said covenants
and agreements.
17. Waiver Of Breach; Specific Performance. The waiver of a breach of any
provision of this Agreement shall not operate or be construed as a waiver of any
other breach. Each of the parties to this Agreement will be entitled to enforce
its or his rights under this Agreement, specifically, to recover damages by
reason of any breach of any provision of this Agreement and to exercise all
other rights existing in its or his favor. The parties hereto agree and
acknowledge that money damages may not be an adequate remedy for any breach of
the provisions of this Agreement and that any party may in its or his sole
discretion apply to any court of law or equity of competent jurisdiction for
specific performance or injunctive relief in order to enforce or prevent any
violations of the provisions of this Agreement.
18. Unsecured General Creditor. The Company shall neither reserve nor
specifically set aside funds for the payment of its obligations under this
Agreement, and such obligations shall be paid solely from the general assets of
the Company. Notwithstanding that Employee may be entitled to receive the value
of his benefit under the terms and conditions of this Agreement, the assets from
which such amount may be paid shall at all times be subject to the claims of the
Company's creditors.
19. No Effect On Other Arrangements. It is expressly understood and agreed that
the payment made in accordance with this Agreement is in addition to any other
benefits or compensation to which Employee may be entitled or for which he may
be eligible, whether funded or unfunded, by reason of his employment with the
Company.
20. Tax Withholding. There shall be deducted from the payment under this
Agreement the amount of any tax required by any governmental authority to be
withheld and paid over by the Company to such governmental authority for the
account of Employee.
21. Compensation. Any compensation paid on behalf of Employee under this
Agreement shall not be considered "compensation," as the term is defined in The
Southern Company Employee Savings Plan, The Southern Company Employee Stock
Ownership Plan, or The Southern Company Pension Plan. The payment under this
Agreement shall not be considered wages, salaries or compensation under any
other employee benefit plan.
22. No Guarantee of Employment. No provision of this Agreement shall be
construed to affect in any manner the existing rights of the Company to suspend,
terminate, alter, modify, whether or not for cause, the employment relationship
of Employee and the Company.
23. Interpretation. The judicial body interpreting this Agreement shall not more
strictly construe the terms of this Agreement against one party, it being agreed
that both parties and/or their attorneys or agents have negotiated and
participated in the preparation hereof.
24. Approval. The terms and conditions of this Agreement are subject to approval
by the Compensation and Management Succession Committee of the Southern Company
Board of Directors, and upon such approval, this Agreement will become effective
upon the date described in Section 26.
25. Voluntary Execution. Employee warrants, represents and agrees that he has
been encouraged in writing to seek advice from anyone of his choosing regarding
this Agreement, including his attorney and accountant or tax advisor prior to
his signing it; that this Agreement represents written notice to do so; that he
has been given the opportunity and sufficient time to seek such advice; and that
he fully understands the meaning and contents of this Agreement. He further
represents and warrants that he was not coerced, threatened or otherwise forced
to sign this Agreement, and that his signature appearing hereinafter is
voluntary and genuine. EMPLOYEE UNDERSTANDS THAT HE MAY TAKE UP TO TWENTY-ONE
(21) DAYS TO CONSIDER WHETHER OR NOT HE DESIRES TO ENTER INTO THIS AGREEMENT. IN
THE EVENT EMPLOYEE EXECUTES THIS AGREEMENT BEFORE THAT TIME, EMPLOYEE CERTIFIES
BY THAT EXECUTION THAT HE KNOWINGLY AND VOLUNTARILY WAIVED THE RIGHT TO THE FULL
21-DAY CONSIDERATION PERIOD, FOR REASONS PERSONAL TO EMPLOYEE, WITH NO PRESSURE
BY ANY COMPANY REPRESENTATIVE TO DO SO. EMPLOYEE AND THE COMPANY AGREE THAT ANY
CHANGES, WHETHER MATERIAL OR IMMATERIAL, WHICH HAVE BEEN MADE TO THIS AGREEMENT
OR THE COMPANY'S ORIGINAL OFFER OF CONSIDERATION IN EXCHANGE FOR RELEASING HIS
CLAIMS UNDER THE AGE DISCRIMINATION IN EMPLOYMENT ACT DID NOT RESTART THE
RUNNING OF THE 21-DAY CONSIDERATION PERIOD DESCRIBED IN THE PRECEDING SENTENCE.
26. Ability to Revoke Agreement. EMPLOYEE UNDERSTANDS THAT HE MAY REVOKE THIS
AGREEMENT BY NOTIFYING THE COMPANY IN WRITING OF SUCH REVOCATION WITHIN SEVEN
(7) DAYS OF HIS EXECUTION OF THIS AGREEMENT AND THAT THIS AGREEMENT IS NOT
EFFECTIVE UNTIL THE EXPIRATION OF SUCH SEVEN (7) DAY PERIOD. HE UNDERSTANDS THAT
UPON THE EXPIRATION OF SUCH SEVEN (7) DAY PERIOD, THIS AGREEMENT WILL BE BINDING
UPON HIM AND HIS HEIRS, ADMINISTRATORS, REPRESENTATIVES, EXECUTORS, SUCCESSORS
AND ASSIGNS AND WILL BE IRREVOCABLE.
[Signatures begin on the following page.]
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the dates written below.
"COMPANY"
SOUTHERN NUCLEAR OPERATING COMPANY, INC.
By: /s/ Ellen N. Lindemann
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Its: VP Human Resources
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Date: 12/22/04
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I UNDERSTAND THAT BY SIGNING THIS AGREEMENT, I AM GIVING UP RIGHTS I MAY
HAVE. I UNDERSTAND THAT I DO NOT HAVE TO SIGN THIS AGREEMENT.
"EMPLOYEE"
WILLIAM GEORGE HAIRSTON III
/s/ William George Hairston III
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Date: 12/21/04
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WITNESSED BY:
/s/ Deborah B. Gurganus
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Date: 12/21/04
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