SEPARATION AGREEMENT
This Separation Agreement (hereinafter "Agreement") is made and entered
into by and between Michael Hanna (hereinafter "Hanna"), and Louisiana-Pacific
Corporation (hereinafter ("L-P"). For purposes of this Agreement, references to
"L-P" shall include all officers, directors, employees, agents, parent
corporations, divisions, subsidiaries and all persons acting by, through, under
or in concert with any of them, and "Hanna" shall include any heirs, assigns or
other persons or entities acting on Hanna's behalf.
L-P and Hanna have agreed to amicably separate their employment
relationship upon the following terms and obligations:
1. Separation Date. Hanna will receive his regular salary and benefits
through his pay-through date of November 15, 1998, which date represents
his last regular workday, plus six weeks vacation. Hanna acknowledges
this sum represents all wages due him.
2. Compensation and Other Consideration.
a. Separation Pay - Hanna shall receive a lump sum of $85,000, payable
on the date of separation, which consists of the Employee Stock
Ownership Trust as described in paragraph 2(d) and Stock Options as
described in paragraph 2 (h) , less required withholdings, as
separation pay. In addition, Hanna shall receive the sum of
$511,200.16, less required withholdings, during each of the years of
1998 and 1999 pursuant to his A.C.I. employment agreement. Hanna shall
have the option of determining when in each year the payment is to be
made.
b. Medical, Dental and Vision Insurance - Following the termination of
Hanna's present L-P-paid coverages upon Hanna's last regular workday,
Hanna will be offered medical, vision and dental continuation coverage
pursuant to the Federal Consolidated Omnibus Reconciliation Act
("COBRA")at Hanna's own expense.
c. Other Insurance - Business Accident Travel insurance will cease on
Hanna's last regular workday. Personal Accident Insurance and Long Term
Disability will continue until the last regular workday for which a
Personal Accident Insurance and Long Term Disability payroll deduction
for Hanna is taken.
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d. Employee Stock Ownership Trust - Hanna acknowledges that as of his
last regular workday, he has 1,250 shares vested in this trust but that
he has no further rights in the trust.
e. Employee Stock Purchase Plans - Nothing in this Agreement will
affect or impair Hanna's rights under the Employee Stock Purchase Plans
offered to L-P employees.
f. Annual Bonus - Hanna will be paid his 1998 annual bonus of $132,000,
less required withholdings, in December 1998 or January 1999, at his
choosing.
g. Long Term Incentive Compensation - Hanna acknowledges that as of
November 15, 1998, he has no vested shares in the Long Term Incentive
Compensation program.
h. Stock Options - Hanna will have ninety (90) days from his last
regular workday in which to exercise the rights to any stock options
which are vested as of his last regular workday. All of Hanna's stock
options which are not vested as of his last regular workday shall be
forfeited. Hanna shall have no right to stock options which are not
vested as of his last regular workday.
3. Future Cooperation. As further consideration, Hanna acknowledges that he
has acquired particular knowledge, information and expertise in his
capacity as Executive Vice President of L-P, and shall make himself
available, as reasonably necessary, in person and by telephone to
cooperate and provide assistance to L-P regarding pending and future
government investigations, pending and future administrative actions and
pending or future litigation, for which he has or enjoys such
information, knowledge and expertise. Hanna will be compensated for his
time pursuant to a rate of $175 per hour with a maximum of $2,000 per day
and will be reimbursed for expenses for reasonable travel, telephone,
mail and other similar items, as required.
4. S.E.C. Investigation. The Securities and Exchange Commission ("S.E.C.")
has questioned Hanna regarding certain activities concerning L-P'S
acquisition of GreenStone Industries, Inc. L-P has advanced and shall
continue to advance Hanna's reasonable counsel fees and expenses, if any,
in this and any related matter. Both parties agree that Hanna's rights to
such advanced funds shall be governed by the Delaware General Corporation
Law and L-P's bylaws regarding indemnification, and Hanna undertakes to
repay to L-P the full amount of any such advanced funds if it shall
ultimately be determined that he is not entitled to indemnification with
respect to them.
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5. Financial Planninq Services. L-P shall provide to Hanna at L-P's expense,
financial services consistent with its current practices, through Ayco
Company, L.P., through December 31, 1998, and including preparation of
his 1998 income taxes.
6. Hanna understands that he has, by this Agreement, been advised to consult
with an attorney of his choice before signing. Hanna also understands
that he has up to twenty-one (21) full days to consider whether to sign
this Agreement. By signing on the date shown below, Hanna voluntarily
elects to forego waiting 21 full days to sign the Agreement.
7. Hanna and L-P acknowledge and agree that for a period of seven (7)
calendar days following his execution of this agreement, Hanna may revoke
this Agreement by providing L-P with written notification of such
revocation and that this Agreement shall not become effective or
enforceable until such revocation period has lapsed.
8. Non-Disclosure. Hanna recognizes and acknowledges that during the course
of his employment he has had and will continue to have access to certain
information not generally known to the public, relating to the products,
sales or business of L-P which may include without limitation, data,
programs, customer or contact lists, sources of supply, prospects or
projections, manufacturing techniques, processes, formulas, research or
experimental work, work in process, trade secrets or any other
proprietary or confidential matter (collectively "Confidential
Information"). Hanna agrees that, except as directed by L-P, Hanna will
not at any time, whether during or after his employment with L-P, use or
disclose to any person for any purpose other than for the benefit of L-P,
any Confidential Information, or permit any person to use, examine or
make copies of any documents, files, data or other information sources
which contain or are derived from Confidential Information, whether
prepared by Hanna or otherwise coming into Hanna's possession or control,
without the prior written permission of L-P.
9. Confidentiality. The Parties agree to keep the terms, amount and fact of
this Agreement confidential, and to not hereafter disclose any
information concerning this Agreement to anyone, including, but not
limited to, any past, present, or prospective employee or applicant for
employment of L-P, without the express written permission of L-P.
Notwithstanding the above, it shall not be a breach of this Agreement if
such disclosure is between Hanna and his immediate family, between Hanna
and officers of L-P, or if
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such disclosure is necessary for effectuating this Agreement, is by
compulsion of law, is made to an attorney for legal advice, or is made to
a tax advisor for tax planning and preparation purposes, provided that
Hanna shall impose on any such person these strict confidentiality
requirements. Any breach by Hanna of this provision will be remedied by
immediate repayment by Hanna of the consideration provided in paragraph
2(a), in addition to any other remedies, including equitable remedies,
recoverable under the law.
10. Complete Agreement. This Agreement embodies the complete understanding
and agreement of the parties hereto relating to the subject matter
hereof.
11. Advice of Attorneys. Hanna has been advised to consult with an attorney
or attorneys of his choosing before executing this Agreement.
12. Attorney Fees. It is hereby agreed among the parties that should any
complaint be filed or claim be made arising out of the breach of any of
the provisions of this Agreement or for the purpose of enforcing any of
its provisions, the prevailing party or parties shall be entitled to its
or their reasonable attorney fees from all other parties as determined by
the trial court. If any appeal is taken from the decision of the trial
court, the prevailing party or parties shall be entitled also to its or
their additional attorney fees on appeal as determined by the appellate
court.
13. Choice of Law. This Agreement is made and entered into in the State of
Oregon and shall in all respects be interpreted, enforced and governed
under the laws of Oregon. The language of all parts of the Agreement
shall in all cases be construed as a whole, according to its fair
meaning, and not strictly for or against any of the parties. Should any
portion of this agreement be found void, the remainder shall continue in
full force and effect.
14. No admission. This Agreement shall not be construed in any manner as an
admission by either party that either has violated any law, policy or
procedure or acted wrongfully with respect to the other or to any other
person. The parties understand that each specifically disclaims any
liability to the other arising from Hanna's employment relationship with
L-P. Each party retains those rights not specifically addressed in this
Agreement.
15. Execution of Agreement. This Agreement may be executed in counterparts.
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This release is executed by me without reliance on any representation by L-P or
any of its representatives and I further state that I HAVE CAREFULLY READ THE
FOREGOING SETTLEMENT, HAVE BEEN ADVISED OF ITS MEANING AND CONSEQUENCES AND KNOW
THE CONTENTS THEROF AND I SIGN THE SAME AS MY OWN FREE ACT.
Executed at 8:40 a.m., this 29th day of October, 1998.
LOUISIANA-PACIFIC CORPORATION MICHAEL HANNA
By: /s/ Mark A. Suwyn /s/ Michael D. Hanna
Title: CEO & Chairman
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