EXHIBIT 99.4
June 13, 2000
Mr. Arthur W. Huge
Via Facsimile and Hand Delivery
Dear Art:
This letter confirms the agreement between Walter Industries, Inc. (" Walter
Industries" or the "Company") and you regarding the terms of your separation
from Walter Industries.
1. You will be separated from Walter Industries effective May 5, 2000
(the effective date).
2. Even if you do not sign this agreement, Walter Industries has paid
to you the compensation that you have earned through the effective
date of your separation and any accrued vacation benefits through
the effective date of your separation. Similarly, even if you do not
sign this agreement, you will be offered benefits to which you are
entitled under the Consolidated Omnibus Budget Reconciliation Act of
1985, as amended (COBRA), and you will retain all vested benefits
you may have under the Walter Industries Profit Sharing Plan,
Supplemental Profit Sharing Plan and 401 (k) Plan, if any.
Additionally you have been paid the guaranteed bonus detailed in
your employment agreement of $150,000 and you have been paid
$175,000 representing the remaining 16,667 shares of stock (at
$10.50 per share) that is also detailed in your employment
agreement.
3. In consideration and in exchange for your agreements contained in
paragraph 4, Walter Industries hereby agrees to provide the
following entitlements; provided that this agreement is signed by
you and returned on or before July 5, 2000; and provided further
that this agreement is not revoked by you within seven (7) days
after it is signed by you.
(a) Commencing as of May 5, 2000, Walter Industries will pay to you a
severance allowance in the amount and form of 104 weeks (the
"Severance Period") of salary continuation at an annualized rate of
$400,000 per year and current auto allowance, less appropriate tax
withholding and other authorized and permitted deductions, until the
severance allowance is fully paid to you. In the event you should
die during such period, the remaining payments shall be paid to your
estate as they come due.
(b) (i) Your health care coverage as an active employee with Walter
Industries will terminate effective June 30, 2000. In accordance
with COBRA you have the right to continue your health care coverage
from your separation date, for a maximum of 18 months or until you
have coverage provided by another employer, subject to and in
accordance with applicable law. Coverage under COBRA is available to
you and your eligible dependent(s) who were enrolled under the
Walter Industries Group Insurance Plan for active employees at the
time of your separation. Each such dependent losing coverage has the
right to make his/her election and pay separate COBRA premiums, if
so desired.
(ii) If you and/or such dependents select COBRA continuation
coverage in accordance with applicable law and the Company's
policies, during the period from June 30, 2000 until November 5,
2001 for which COBRA continuation coverage is effective, your
monthly portion of the COBRA
premium will equal the payment required of active employees to
maintain coverage under the Walter Industries Group Insurance Plan,
as it may change from time to time, and the Company will pay the
remainder of such COBRA premium. Such payment of your monthly
portion will be made by deductions from your severance checks. Such
continued coverage will be subject to the terms and conditions of
such health care benefit plans as apply to active employees
generally, including the Company's right to amend and terminate such
plans. The portion of the premium paid by the Company will be
taxable compensation to you. Notwithstanding the foregoing, but in
accordance with the provisions of applicable law, the coverage of
any COBRA "qualified beneficiary" under the Company's health care
benefit plans, including you, will terminate at the time such COBRA
"qualified beneficiary" obtains substitute coverage from another
employer.
(iii) During the COBRA portion of the Severance Period (in the event
you elect to secure health insurance from a private provider in lieu
of COBRA) and during the post-COBRA portion of the Severance Period,
the Company will pay to you monthly an amount equal to the
difference between your monthly cost of coverage from a private
provider (or one-twelfth of the annual cost of such policy) and the
amount you would have paid for coverage as an employee of the
Company, not to exceed the amount that the Company would otherwise
pay pursuant to subparagraph (ii) above. The Company's obligation to
make such payments shall cease in the event you obtain coverage
through another employer. The portion of the premium paid by the
Company will be taxable compensation to you and the amount so paid
will be subject to applicable withholding.
(c) You will be entitled to executive outplacement for up to eight
months at a firm contracted by the Company plus a lump-sum payment
of $2,500.
(d) Walter Industries will pay to you $148,500, representing payment in
full of the Company's obligation for the purchase of an annuity as
provided in your employment agreement dated June 1, 1999.
(e) Walter Industries will pay to you $60,000 in lieu of any or all
contributions to which you may be entitled to pursuant to the Walter
Industries Inc. Profit Sharing Plan.
(f) The lump-sum amounts provided for in subparagraphs (c), (d) and (e)
above, shall be paid (subject to applicable withholding) to you, or
in the event of your death to your estate, within three business
days of the expiration of the seven-day period set forth in
paragraph 6(c) of this agreement.
4. In consideration and in exchange for the entitlements set forth in
paragraph 3 above, you hereby agree.
(a) On behalf of yourself and anyone claiming through you, to release,
acquit, and discharge forever Walter Industries, Inc., and any of
its predecessors, successors, assigns, past and present officers,
owners, representatives, directors, employees, consultants,
divisions, subsidiaries, affiliates, partners, parent organizations
and anyone claiming through them (hereinafter "the Companies"
collectively), from any and all manner of claims whatsoever which
you ever had or may in the future have or hold against the
Companies, known and unknown, arising out of your employment with
any of the Companies and/or the cessation of your employment with
any of the Companies. Said claims or causes of action include, but
are not limited to, claims or causes of action under the Age
Discrimination in Employment Act and relevant state and/or municipal
statutes; suits for employment discrimination under 42 U.S.C. Sec
2000e and 42 U.S.C. Sec 1981 and relevant state and/or municipal
statutes; claims or causes of action under the Civil Rights Act of
1991 and relevant state and/or municipal statutes; claims or causes
of action for discrimination on the basis of the Americans with
Disabilities Act and relevant state and/or municipal statutes;
claims or causes of action under the Employee Retirement Income
Security Act of 1974, as amended; claims or causes of action under
the Equal Pay Act of 1963, as amended; claims or causes of action
under the Older Workers Benefits
Protection Act; claims or causes of action under the Fair Labor
Standards Act, as amended, and relevant state and/or municipal
statutes; claims or causes of action under the Family and Medical
Leave Act of 1993, as amended, and relevant state and/or municipal
statutes; claims or causes of action for wrongful discharge; any
claims for wrongful discharge, breach of contract, fraud,
misrepresentation or any compensation claims, including compensation
damages, punitive damages, attorney fees, costs and expenses; and
claims or causes of action for breach of any alleged contract or
public policy arising from your employment with any of the
Companies. Notwithstanding this waiver, you do not waive rights or
claims that may arise from (i) events after the date this waiver is
executed, other than events expressly contemplated by this letter
agreement or (ii) the Company's failure to abide by the terms of
this agreement.
(b) You will not bring any legal action against the Companies for
claims, potential or actual, waived under this agreement. You
further agree that should you bring any type of administrative or
legal action arising out of claims waived under this agreement, you
will bear all legal fees and costs, including those of the
Companies.
(c) You represent and agree that the release in paragraph (a) above is
given in exchange for fair and adequate consideration.
(d) You have returned to Walter Industries all company property in your
possession in good working order, ordinary wear and tear excepted,
including, but not limited to: company vehicles; credit cards;
equipment (including, without limitation, computer equipment);
supplies; samples; prototypes; keys; and documents such as client
lists, price lists, phone listings, and equipment lists. An accurate
and documented expense report, for any and all reimbursable expenses
you incurred up to and including the date of your separation, must
be submitted to Walter Industries within forty-five (45) calendar
days following the date of your separation. Any expenses, otherwise
reimbursable to you, turned in after this forty-five (45) day period
will not be reimbursed.
(e) You will reasonably cooperate with the Companies, at their expense,
in their defense of or other participation in any administrative,
judicial or other proceeding arising from any charge, complaint or
other action which has or may be filed.
(f) You will not disclose any confidential information you acquired
while an employee of the Companies, to any other person or entity,
or use such information in any manner until and unless such
confidential information shall have become, through no fault of you,
generally known to the public or you are required by law to make
disclosure.
5. In the event that you breach any of your agreements under paragraph
4, any outstanding obligations of Walter Industries hereunder will
immediately terminate.
6. Walter Industries hereby advises you as follows pursuant to the
Older Workers Benefits Protection Act of 1990:
(a) You have the right to consult with an attorney before signing
this agreement.
(b) You have twenty-one (21) days from the date of receipt of this
letter to consider this agreement.
(c) If you do sign this agreement, you have seven (7) days after
signing it to revoke this agreement and this agreement will
not be effective and no payments, pursuant to paragraph 3 of
this agreement, will be made to you until this seven (7) day
revocation period has expired.
7. The provisions of this agreement are severable. If any provision or
portion thereof is held to be invalid or unenforceable, it will not
affect the validity or unenforceability of any other provisions or
portions thereof.
8. You represent that you have thoroughly read and considered all
aspects of this agreement, that you understand all of its
provisions, and that you are voluntarily entering into this
agreement.
9. The parties agree that nothing in this agreement is an admission by
any party hereto of any act, practice, or policy of discrimination
or breach of contract either in violation of applicable law or
otherwise, and that nothing in this agreement is to be construed as
such by any other person.
10. Neither the Company nor you will, directly or indirectly, make, have
made or cause to be made any statements to third parties criticizing
or disparaging the other or commenting on the character or business
reputation of the other.
11. This agreement sets forth the entire agreement between you and
Walter Industries and supersedes any and all prior oral and/or
written agreements or understandings between you and Walter
Industries concerning the subject matter. This agreement may not be
altered, amended or modified, except by a further written document
signed by you and Walter Industries.
If you are willing to enter into this agreement, please date and sign the
enclosed copy of this agreement in the space indicated below, and return that
copy to me no later than July 5, 2000. As noted above, you have seven (7) days
after you sign this agreement to revoke the agreement should you wish to do so.
Sincerely,
Accepted and agreed to this _________ day of ___________ 2000.
_____________________________________________________________________
RECEIPT
I, _________________________, received from _______________________, a copy of
the attached separation agreement dated __________________, on this date.
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