SEPARATION AGREEMENT
This Separation Agreement (hereinafter "Agreement") is made and entered
into by and between Karen Lundquist Malkewitz (hereinafter "Malkewitz"), 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 "Malkewitz" shall include any
heirs, assigns or other persons or entities acting on Malkewitz's behalf.
L-P and Malkewitz have agreed to amicably separate their employment
relationship upon the following terms and obligations:
1. Separation Date. Malkewitz will receive her regular salary and benefits
through her pay-through date of January 4, 1999, which date represents
her last regular workday, plus accrued and unused vacation days.
Malkewitz acknowledges this sum represents all wages due her.
2. Compensation and Other Consideration.
a. Separation Pay - Malkewitz shall receive a lump sum equal to 52
weeks' base pay, or $199,500, less required withholdings.
b. Medical, Dental and Vision Insurance - Following the termination of
Malkewitz's present L-P-paid coverages upon Malkewitz's last regular
workday, Malkewitz will be offered medical, vision and dental
continuation coverage pursuant to the Federal Consolidated Omnibus
Reconciliation Act ("COBRA"), at L-P's expense through February 28,
1999. Thereafter, Malkewitz will be required to make any such payments
at her own expense.
c. Other Insurance - Business Accident Travel insurance will cease on
Malkewitz'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 Malkewitz is taken.
d. Employee Stock Ownership Trust - Malkewitz acknowledges that as of
her last regular workday, she will not have completed the five (5)
years of service required for vesting and therefore has no further
rights in this trust.
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e. Employee Stock Purchase Plans - Nothing in this Agreement will
affect or impair Malkewitz's rights under the Employee Stock Purchase
Plans offered to L-P employees.
f. Annual Bonus - Malkewitz's 1998 annual bonus, if any, less required
withholdings, will be determined at the Board of Directors Meeting held
the first quarter of 1999. Any annual bonus will be based upon the
level of attainment of individual goals for 1998 under L-P's Annual
Cash Incentive Award Plan for executive officers or, where applicable,
the executive's contract bonus amount for 1998 if this amount is
greater. Malkewitz acknowledges that such annual bonus is not due or
owing for purposes of Oregon law until the date on which it is
determined.
g. Long Term Incentive Compensation - Malkewitz's long term incentive
compensation of $20,000 per annum for years 1997 and 1998 will be paid
at the time of severance, less required withholdings.
h. Stock Options - Malkewitz will have until and including April 4,
1999 to exercise any stock options which are vested as of her last
regular workday. All of Malkewitz's stock options which are not vested
as of her last regular workday shall be canceled and of no further
effect. Malkewitz shall have no rights with respect to stock options
which are not vested as of her last regular workday. On April 5, 1999,
all vested stock options not previously exercised shall expire and be
of no further effect.
3. Future Cooperation. As further consideration, Malkewitz acknowledges that
she has acquired particular knowledge, information and expertise in her
capacity as Vice President, Manufacturing of L-P, and shall make herself
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 she has or enjoys such
information, knowledge and expertise. Malkewitz agrees that she will
notify L-P as soon as reasonably practicable of any subpoena that she
receives that relates to her former capacity as Vice-President,
Manufacturing. Malkewitz will be compensated for her time pursuant to a
rate of $200 per hour with a maximum of $1,500 per day and the
reimbursement of expenses for reasonable travel, telephone, mail and
other similar items, as required.
4. Financial Planning Services. L-P shall provide to Malkewitz at L-P's
expense financial services, consistent with its
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current practices, through Ayco Company, L.P., for a period of one year
following the effective date of this Agreement.
5. Release. Except as otherwise provided herein, Malkewitz and L-P
irrevocably and unconditionally release, acquit and forever discharge
each other and their respective owners, stockholders, predecessors,
successors, assigns, heirs, agents, directors, officers, employees,
employee benefit plans and trusts, representatives and attorneys of such
divisions, subsidiaries, affiliates (and agents, directors, officers,
employees, representatives and attorneys of such divisions, subsidiaries
and affiliates), and all persons acting by, through, under or in concert
with any of them from any and all charges, complaints, claims, promises,
agreements, controversies, liabilities, obligations, damages, actions,
causes of action, suits, rights, demands, costs, losses, debts and
expenses (including attorney's fees and costs actually incurred), of any
nature whatsoever, known, whether based on contract, statute or common
law, or unknown which Malkewitz or L-P now have, own, or hold, or claims
to have, own, or hold, or to have had, owned, or held against any of the
parties so released.
Malkewitz specifically acknowledges and agrees that by executing this
Agreement she is releasing any claims against L-P for claims under Title
VII of the Civil Rights Act of 1964, the Americans With Disabilities Act,
the Family and Medical Leave Act, the Federal Age Discrimination in
Employment Act, the Older Workers Benefit Protection Act, Or. Rev. Stat.
Chapter 659 and any claims growing out of any legal restriction on L-P's
right to terminate its employees including, but not limited to, contract,
tort, public policy or wrongful discharge.
Malkewitz understands that she has, by this Agreement and release, been
advised to consult with an attorney of her choice before signing.
Malkewitz also understands that she has up to twenty-one (21) full days
to consider whether to sign this Agreement and release. By signing on the
date shown below, Malkewitz voluntarily elects to forego waiting 21 full
days to sign the Agreement and release.
Malkewitz and L-P acknowledge and agree that for a period of seven (7)
calendar days following her execution of this Agreement, Malkewitz 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.
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6. Non-Disclosure. Malkewitz recognizes and acknowledges that during the
course of her employment she 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"). Malkewitz agrees that, except as directed by L-P,
Malkewitz will not at any time, whether during or after her 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 Malkewitz or otherwise coming into
Malkewitz' possession or control, without the prior written permission of
L-P.
7. Confidentiality. Malkewitz agrees 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 Malkewitz and her immediate family, between
Malkewitz and officers of L-P, or if 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 Malkewitz shall impose on any
such person these strict confidentiality requirements. Any breach by
Malkewitz of this provision will be remedied by immediate repayment by
Malkewitz of the consideration provided in paragraph 2(a), in addition to
any other remedies, including equitable remedies, recoverable under the
law.
8. Complete Agreement. This Agreement embodies the complete understanding
and agreement of the parties hereto relating to the subject matter
hereof.
9. Advice of Attorneys. Malkewitz has been advised to consult with an
attorney or attorneys of her choosing before executing this Agreement.
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10. 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.
11. 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.
12. No admission. This Agreement shall not be construed in any manner as an
admission by L-P that it has violated any law, policy or procedure or
acted wrongfully with respect to Malkewitz or any other person. Malkewitz
understands that L-P specifically disclaims any liability to Malkewitz
arising from her employment relationship with L-P.
13. Execution of Agreement. This Agreement may be executed in counterparts.
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 5:O5 p.m., this 28 day of October, 1998.
LOUISIANA-PACIFIC CORPORATION KAREN LUNDQUIST MALKEWITZ
By: /s/ Mark A. Suwyn /s/ Karen D. Malkewitz
(formerly Lundquist)
Title: CEO & Chairman Karen Lundquist Malkewitz
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