Exhibit 10.24
16 September 2003
Mr. Robert E. Gadomski
2332 Spring Valley Road
Bethlehem, PA 18015
Dear Bob:
This letter is written regarding your retirement from employment with
Air Products.
Air Products appreciates your loyal service over the years and your
commitment to continue in your current position performing the duties of that
position as expected of you by the Board of Directors (the "Board") and the
Chief Executive Officer until your last day of employment and retirement on 4
January 2004 (your "employment termination date"). Air Products is willing to
provide you with benefits under the Air Products and Chemicals, Inc. Corporate
Executive Committee Retention/Separation Program (the "Plan"), the terms of
which are summarized in Exhibit A to this letter. The Management Development and
Compensation Committee of the Board has determined to amend the Plan with
respect to you so that your cash severance benefit under the Plan shall be
equivalent to two times (rather than the Plan's normal one times) the sum of
your base salary as of your employment termination date plus 100% of the
midpoint target bonus for your salary grade level in the fiscal year of your
employment termination date; and, further, so that your stock option granted for
the fiscal year of your employment termination date will continue to vest and
remain in effect for its stated term following such date. Your transition
stipend will be $40,000.
In response to questions you have raised, this is to confirm that: (a)
your cash severance Benefit of $2,262,700, amount in lieu of a prorated, 100%
target Bonus for fiscal year 2004, i.e., $119,500, and $40,000 transition
stipend, along with accrued but unpaid cash compensation and Long-Term Incentive
Plans career shares and earned but deferred performance shares referenced in the
Plan as amended by this letter (the "Amended Plan"), will be paid to you
promptly, but in no event later than 30 days after, the later of your employment
termination date and seven days following your execution of the Second Release
(referred to later in this letter); (b) your obligation to assist the Chief
Executive Officer in the identification, recruitment, and transitioning of your
successor, which is a condition to receiving your severance benefits under the
Amended Plan, ceases as of your employment termination date; and (c) the intent
of
Mr. Robert E. Gadomski
16 September 2003
Page 2
Section 8(ii) of your Noncompetition, Nonsolicitation, and Employment Agreement
attached as Exhibit C to this letter is that such Agreement shall govern the
interpretation of the noncompetition conditions applicable to your outstanding
awards under the Long-Term Incentive Plan (which are set forth in the first
indented clause of Section 2 of the statement of "Conditions" attached to this
letter as Exhibit D).
Payment of Plan benefits mentioned in this letter is conditioned upon
and will be made in consideration of, among other things, your signing the
General Release and the Noncompetition, Nonsolicitation, and Nondisparagement
Agreement (together, the "Agreements"), which are Exhibits B and C to this
letter (as well as upon your executing, and not revoking as provided therein,
another written release containing substantially the same provisions as
described in Exhibit B to this letter, prior to the 22nd day following your
employment termination date (the "Second Release"), in consideration of which
the Company shall execute a second release in favor of you on the date the
Second Release becomes irrevocable, in the form attached to Exhibit B to this
letter). You must sign and date both copies of the Agreements and return one
copy of this entire 12 page package to me. Please take at least 21 days to read
these materials carefully before deciding to execute the Agreements (after which
you will have 7 days in which to change your mind and revoke the General
Release). If you have any questions regarding this letter or the Plan benefits,
please contact me. If you have any questions regarding the Plan or the
Agreements, Air Products will be pleased to answer them, but advises you to
discuss the Agreements with your personal lawyer and rely upon her or his
advice.
Very truly yours,
/s/ Leonard V. Broese van Groenou
Leonard V. Broese van Groenou
Vice President - Human Resources
Exhibit A
SUMMARY
AIR PRODUCTS AND CHEMICALS, INC. (THE "COMPANY")
CEC RETENTION/SEPARATION PROGRAM (THE "PLAN")
Executives who serve on the Company's Corporate Executive Committee ("CEC") will
become entitled to Plan benefits following termination of employment with the
Company if they end their employment on the date specified or agreed to by the
Chief Executive Officer (the "Employment Termination Date"). Once the Employment
Termination Date is set, the Company cannot terminate or adversely amend the
Plan as it applies to the Executive, and the Executive must (i) continue in his
current office and perform such duties for the Company as are typically related
to his position (or such other position as the Chief Executive Officer
reasonably requests) and to assist in the identification, recruitment, and/or
transitioning of his successor, performing all assigned duties in the manner
reasonably directed by the Chief Executive Officer, in his sole discretion; (ii)
cease employment with the Company on the Employment Termination Date; and (iii)
sign (and not revoke) a general release of all claims against the Company and a
two-year noncompete agreement. In consideration of and subject to complying with
the foregoing, the Executive will receive the following payments and treatment
of outstanding stock awards, as well as a release of claims by the Company
against him.
CASH PAYMENTS FOLLOWING THE EMPLOYMENT TERMINATION DATE, THE EFFECTIVE DATE OF
THE GENERAL RELEASE, AND THE SIGNING OF THE NONCOMPETITION, NONSOLICITATION, AND
NONDISPARAGEMENT AGREEMENT
- - A severance Benefit equivalent to one times base Salary plus 100% Bonus at
midpoint/target for the Executive's salary grade.
- - An amount representing a 100% target Bonus for the Executive's salary
grade at the Employment Termination Date, "prorated", i.e., multiplied by
a fraction the numerator of which is the number of days in the current
fiscal year through the Employment Termination Date and the denominator of
which is 365.
- - Accrued but unpaid cash compensation which will include but not be limited
to base Salary through the Employment Termination Date, any accrued but
unpaid vacation pay, and similar unpaid items that have accrued or to
which the Executive has become entitled as of the Employment Termination
Date, including declared but unpaid bonuses and unreimbursed employee
business expenses.
- - A stipend to cover the Executive's reasonable miscellaneous transition
expenses including for outplacement assistance and legal fees.
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TREATMENT OF THE EXECUTIVE'S OUTSTANDING LONG-TERM INCENTIVE PLAN AWARDS
- - All stock options and stock appreciation rights which have been
outstanding for at least one year prior to the Employment Termination Date
will continue to vest according to their normal vesting schedule and
remain in effect for the stated term.
- - All unearned performance shares or other awards with performance-based
vesting or earnout will earn out consistent with the decision made by or
on behalf of the Company for other senior executives for the respective
cycle and be paid out promptly after earn out or vesting.
- - All awards, including career shares and earned but deferred performance
shares, which are subject to time-based vesting or other conditions
unrelated to Company performance, will be paid out promptly.
DISABILITY OR DEATH
- - Before the Employment Termination Date has been set: No Plan payments or
other benefits will be due and owing to the Executive or, in the case of
his death, to his estate or beneficiary.
- - After the Employment Termination Date has been set but not yet attained:
All Plan payments and other benefits will be made and provided to the
Executive or, in the case of his death, to his estate or beneficiary
unless the Executive retires prior to the date of his death, in which case
no Plan payments or other benefits will be made or provided to his
beneficiary or to his estate. For this purpose, "retire" means to have
separated from employment and begun to receive an immediate pension
benefit under the Company's defined-benefit Pension Plan for Salaried
Employees and Supplementary Pension Plan.
CHANGE IN CONTROL ("CIC") AGREEMENT
- - Upon a defined CIC, the Company's CIC severance agreement or other CIC
arrangements in effect at the time, if any, will supercede and replace the
Plan.
All capitalized terms included in this Plan Summary have the meanings specified
in the full Plan text, a copy of which will be provided to a Covered Executive
upon request to the Company's Vice President - Human Resources. The Covered
Executive agrees that the Plan text (as it may be amended for the Covered
Executive as stated in the letter from the Vice President - Human Resources to
which this Plan Summary is attached) and all determinations made by persons
referred to in the Plan text govern all rights and responsibilities related to
or created by the Plan.
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Exhibit B
GENERAL RELEASE
1. I, ROBERT E. GADOMSKI (the "Executive"), for and in
consideration of (a) certain severance benefits to be paid and provided to me by
Air Products and Chemicals, Inc. (the "Company") under the Air Products and
Chemicals, Inc. Corporate Executive Committee Retention/Separation Program, as
amended as provided in the letter dated 16 September 2003, to which this General
Release is attached (the "Plan") and (b) the Company's execution of a release in
favor of the Executive, on the date this General Release becomes irrevocable,
substantially in the form attached hereto as Annex 1, and conditioned upon such
payments and provisions, do hereby REMISE, RELEASE, AND FOREVER DISCHARGE Air
Products and Chemicals, Inc. (the "Company") and each of its past or present
subsidiaries and affiliates, its and their past or present officers, directors,
shareholders, employees and agents, their respective successors and assigns,
heirs, executors and administrators, the pension and employee benefit plans of
the Company, or of its past or present subsidiaries or affiliates, and the past
or present trustees, administrators, agents, or employees of the pension and
employee benefit plans (hereinafter collectively included within the term the
"Company"), acting in any capacity whatsoever, of and from any and all manner of
actions and causes of actions, suits, debts, claims and demands whatsoever in
law or in equity, which I ever had, now have, or hereafter may have, or which my
heirs, executors or administrators hereafter may have, by reason of any matter,
cause or thing whatsoever from the beginning of my employment with the Company
to the date hereof and particularly, but without limitation of the foregoing
general terms, any claims arising from or relating in any way to my employment
relationship and the termination of my employment relationship with the Company,
including but not limited to, any claims which have been asserted, could have
been asserted, or could be asserted now or in the future under any federal,
state or local laws, including any claims under the Pennsylvania Human Relations
Act, 43 PA. C.S.A. Sections 951 et seq., as amended, the Rehabilitation Act of
1973, 29 USC Sections 701 et seq., as amended, Title VII of the Civil Rights Act
of 1964, 42 USC Sections 2000e et seq., as amended, the Civil Rights Act of
1991, 2 USC Sections 60/ et seq., as applicable, the Age Discrimination in
Employment Act of 1967, 29 USC Sections 621 et seq., as amended ("ADEA"), the
Americans With Disabilities Act, 29 USC Sections 706 et seq., and the Employee
Retirement Income Security Act of 1974, 29 USC Sections 301 et seq., as amended,
any contracts between the Company and me and any common law claims now or
hereafter recognized and all claims for counsel fees and costs; provided,
however, that this Release shall not apply to any entitlements under the terms
of the Plan or under any other plans or programs of the Company in which I
participated and under which I have accrued and become entitled to a benefit
other than under any Company separation or severance plan or programs.
Notwithstanding the foregoing, I understand that I shall be indemnified by the
Company as to any liability, cost or expense for which I would have been
indemnified during
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employment, in accordance with the Company's certificate of incorporation or
insurance coverages for employees of the Company serving in executive capacities
for actions taken on behalf of the Company within the scope of my employment by
the Company.
2. Subject to the limitations of paragraph 1 above, I
expressly waive all rights afforded by any statute which expressly limits the
effect of a release with respect to unknown claims. I understand the
significance of this release of unknown claims and the waiver of statutory
protection against a release of unknown claims.
3. I hereby agree and recognize that my employment by
the Company was/will be permanently and irrevocably severed on 4 January 2004
and the Company has no obligation, contractual or otherwise to me to hire,
rehire or reemploy me in the future. I acknowledge that the terms of the Plan
provide me with payments and benefits which are in addition to any amounts to
which I otherwise would have been entitled.
4. I hereby agree and acknowledge that the payments and
benefits provided by the Company are to bring about an amicable resolution of my
employment arrangements and are not to be construed as an admission of any
violation of any federal, state or local statute or regulation, or of any duty
owed by the Company and that the Plan was, and this Release is, executed
voluntarily to provide an amicable resolution of my employment relationship with
the Company.
5. I hereby acknowledge that nothing in this Release
shall prohibit or restrict me from: (i) making any disclosure of information
required by law; (ii) providing information to, or testifying or otherwise
assisting in any investigation or proceeding brought by, any federal regulatory
or law enforcement agency or legislative body, any self-regulatory organization,
or the Company's designated legal, compliance or human resources officers; or
(iii) filing, testifying, participating in or otherwise assisting in a
proceeding relating to an alleged violation of any federal, state or municipal
law relating to fraud, or any rule or regulation of the Securities and Exchange
Commission or any self-regulatory organization.
6. I hereby certify that I have read the terms of this
Release, that I have been advised by the Company to discuss it with my attorney,
that I have received the advice of counsel and that I understand its terms and
effects. I acknowledge, further, that I am executing this Release of my own
volition with a full understanding of its terms and effects and with the
intention of releasing all claims recited herein in exchange for the
consideration described in the Agreement, which I acknowledge is adequate and
satisfactory to me. None of the above named persons, nor their agents,
representatives, or attorneys have made any representations to me concerning the
terms or effects of this Release other than those contained herein.
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7. I hereby acknowledge that I have been informed that I
have the right to consider this Release for a period of 21 days prior to
execution. I also understand that I have the right to revoke this Release for a
period of seven days following execution by giving written notice to the Company
at 7201 Hamilton Boulevard, Allentown Pennsylvania 18195-1501, Attention:
General Counsel.
8. I hereby further acknowledge that the terms of
Appendix B of the Plan continue to apply for the balance of the time periods
provided therein and that I will abide by and fully perform such obligations.
Intending to be legally bound hereby, I execute the foregoing
Release this ___ day of _____________, 20 ___.
_______________________ ________________________
Witness Executive
Robert E. Gadomski
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ANNEX 1
GENERAL RELEASE
1. Air Products and Chemicals, Inc. (the "Company") on
its behalf and on behalf of its subsidiaries and affiliates, their officers,
directors, partners, employees and agents, their respective successors and
assigns, heirs, executors and administrators (hereinafter collectively included
within the term "Company"), for and in consideration of ROBERT E. GADOMSKI (the
"Executive") executing the general release of claims against the Company dated
_______________ (the "Executive's Release of the Company"), and other good and
valuable consideration, does hereby REMISE, RELEASE, AND FOREVER DISCHARGE the
Executive, his assigns, heirs, executors and administrators (hereinafter
collectively included within the term "Executive"), acting in any capacity
whatsoever, of and from any and all manner of actions and causes of actions,
suits, debts, claims and demands whatsoever in law or in equity, which it ever
had, now have, or hereafter may have, by reason of any matter, cause or thing
whatsoever from the beginning of the Executive's employment with the Company to
the date of this Release arising from or relating in any way to the Executive's
employment relationship and the termination of his employment relationship with
the Company, including but not limited to, any claims which have been asserted,
could have been asserted, or could be asserted now or in the future under any
federal, state or local laws, any contracts between the Company and the
Executive, other than the Executive's Release of the Company, the Executive's
Noncompetition, Nonsolicitation, and Nondisparagement Agreement with the
Company, and the Employee Patent and Confidential Information Agreement entered
into by the Executive on 31 August 1970, and any common law claims now or
hereafter recognized and all claims for counsel fees and costs, but in no event
shall this release apply to any action attributable to a criminal act or to an
action outside the scope of the Executive's employment.
2. Subject to the limitations of paragraph 1 above, the
Company expressly waives all rights afforded by any statute which expressly
limits the effect of a release with respect to unknown claims. The Company
understands the significance of this release of unknown claims and the waiver of
statutory protection against a release of unknown claims.
3. The Company hereby certifies that it has been advised
by counsel in the preparation and review of this Release.
Intending to be legally bound hereby, Air Products and
Chemicals, Inc. executes the foregoing Release this ____ day of ____________,
20__.
_______________________________ By:______________________________
Witness Leonard V. Broese van Groenou
Vice President - Human Resources
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Exhibit C
NONCOMPETITION, NONSOLICITATION, AND NONDISPARAGEMENT
AGREEMENT (THE "AGREEMENT")
I, ROBERT E. GADOMSKI (the "Executive"), for and in
consideration of (a) certain severance benefits to be paid and provided to me by
Air Products and Chemicals, Inc. (the "Company") under the Air Products and
Chemicals, Inc. Corporate Executive Committee Retention/Separation Program, as
amended as provided in the letter dated 16 September 2003 to which this
Agreement is attached (the "Plan"), and (b) the Company's execution of a release
in favor of the Executive, I, the Executive, hereby covenant and agree as
follows:
1. The Executive acknowledges that the Company is
generally engaged in business throughout the world. During the Executive's
employment by the Company and for two years after the Executive's Employment
Termination Date (as defined in the Plan), the Executive agrees that he will
not, unless acting with the prior written consent of the Company, directly or
indirectly, own, manage, control, or participate in the ownership, management or
control of, or be employed or engaged by, or otherwise affiliated or associated
with, as an officer, director, employee, consultant, independent contractor or
otherwise, (i) Bayer Corporation, BASF Corporation, Dow Chemical Co., Imperial
Chemical Industries, PLC, Forbo Group, Rohm & Haas Co., Lyondell Chemical
Company, National Starch and Chemical Company, Wacker Group, and Celanese AG; or
(ii) any other corporation, partnership, proprietorship, firm, association, or
other business entity which is (a) engaged in any manner anywhere in industrial
gases activities as its primary business, including without limitation Airgas,
Inc., BOC Group, Air Liquide Group, Nippon Sanson Corporation, Air Water Inc.,
Praxair, Inc., and Linde, or (b) which is engaged in any manner anywhere in
Europe, the United States, Mexico, or Canada in the medical home healthcare
business; provided, however, that the ownership of not more than 5% of the
equity of a publicly traded entity shall not be deemed to be a violation of this
paragraph.
2. The Executive also agrees that he will not, directly
or indirectly, during the period described in paragraph (1), induce any person
who is an employee, officer, director, or agent of the Company, to terminate
such relationship, or employ, assist in employing or otherwise be associated in
business with any present or former employee or officer of the Company,
including without limitation those who commence such positions with the Company
after the Employment Termination Date.
3. For the purposes of this Agreement, the term
"Company" shall be deemed to include Air Products and the subsidiaries and
affiliates of Air Products.
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4. The Executive acknowledges and agrees that the
restrictions contained in this Agreement are reasonable and necessary to protect
and preserve the legitimate interests, properties, goodwill and business of the
Company, that the Company would not have entered into this Agreement in the
absence of such restrictions and that irreparable injury will be suffered by the
Company should the Executive breach the provisions of this Section. The
Executive represents and acknowledges that (i) the Executive has been advised by
the Company to consult the Executive's own legal counsel in respect of this
Agreement, (ii) the Executive has consulted with and been advised by his own
counsel in respect of this Agreement, and (iii) the Executive has had full
opportunity, prior to execution of this Agreement, to review thoroughly this
Agreement with the Executive's counsel.
5. The Executive further acknowledges and agrees that a
breach of the restrictions in this Agreement will not be adequately compensated
by monetary damages. The Executive agrees that the Company shall be entitled to
(i) preliminary and permanent injunctive relief, without the necessity of
proving actual damages, or posting of a bond, (ii) an equitable accounting of
all earnings, profits and other benefits arising from any violation of this
Agreement, and (iii) enforce the terms, including requiring forfeitures, under
other plans, programs and agreements under which the Executive has been granted
a benefit contingent on a covenant similar to those contained in this Agreement,
which rights shall be cumulative and in addition to any other rights or remedies
to which the Company may be entitled. In the event that the provisions of this
Agreement should ever be adjudicated to exceed the limitations permitted by
applicable law in any jurisdiction, it is the intention of the parties that the
provision shall be amended to the extent of the maximum limitations permitted by
applicable law, that such amendment shall apply only within the jurisdiction of
the court that made such adjudication and that the provision otherwise be
enforced to the maximum extent permitted by law.
6. If the Executive breaches his obligations under this
Agreement, he agrees that suit may be brought, and that he consents to personal
jurisdiction, in the United States District Court for the Eastern District of
Pennsylvania, or if such court does not have jurisdiction or will not accept
jurisdiction, in any court of general jurisdiction in Allentown, Pennsylvania;
consents to the non-exclusive jurisdiction of any such court in any such suit,
action or proceeding; and waives any objection which he may have to the laying
of venue of any such suit, action or proceeding in any such court. The Executive
also irrevocably and unconditionally consents to the service of any process,
pleadings, notices or other papers.
7. Executive further agrees, covenants, and promises
that he will not in any way communicate the terms of this Agreement to any
person other than his immediate family and his attorney and financial consultant
or when necessary to advise a third party of his obligations under this
Agreement. Notwithstanding the foregoing, the Company and Executive also agree
that for a period of two years following the Employment Termination Date,
Executive will provide and that at all times after the date hereof the Company
may similarly provide, with prior written
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notice to Executive, a copy of this Agreement to any business or enterprise (i)
which Executive may directly or indirectly own, manage, operate, finance, join,
control or of which he may participate in the ownership, management, operation,
financing, or control, or (ii) with which Executive may be connected as an
officer, director, employee, partner, principal, agent, representative,
consultant, or otherwise, or in connection with which Executive may use or
permit to be used Executive's name. Executive agrees not to disparage the name,
business reputation, or business practices of the Company or its subsidiaries or
affiliates, or its or their officers, employees, or directors, and the Company
agrees not to disparage the name or reputation of Executive.
8. The Executive hereby expressly acknowledges and
agrees that (i) the provisions of the Employee Patent and Confidential
Information Agreement entered into by him on 31 August 1970, shall continue to
apply in accordance with its terms, and (ii) the provisions of the Executive's
outstanding incentive award agreements granted under the Company's Long-Term
Incentive Plan, as defined in the Plan, shall continue to apply in accordance
with their terms except as otherwise provided in Section 3.02 of the Plan and
except that, for purposes of interpreting the provisions of the first indented
clause of Section 2 of the "Conditions"(as defined in, and as set forth in
Exhibit A to, each of the Executive's award agreements under the Long-Term
Incentive Plan), "in Competition with the Company" shall be construed as
provided in this Agreement.
9. No failure or delay on the part of the Company in
exercising any power or right hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any such right or power preclude any
further or other exercise thereof or the exercise of any other right or power
hereunder. No modification or waiver of any provision of this Agreement or
consent to any departure by any party therefrom shall in any event be effective
until the same shall be in writing and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which given. No
notice to or demand on any party in any case shall entitle such party to any
other or further notice or demand in similar or other circumstances.
10. This Agreement shall be construed in accordance with
the laws of the Commonwealth of Pennsylvania without giving effect to its
conflict of laws provisions. This Agreement shall extend to and enure to the
benefit of the respective successors and assigns of the Company.
Intending to be legally bound hereby, I execute the
Noncompetition, Nonsolicitation, and Nondisparagement Agreement this ___ day of
_____________, 20 ___.
_________________________ ________________________
Witness Executive
Robert E. Gadomski
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Exhibit D
2003 AWARDS UNDER THE PLAN ARE SUBJECT TO THE FOLLOWING CONDITIONS:
1. You continue to comply with the terms of your employee patent and trade
secret agreement and with all other agreements with, and obligations and
duties to, the Company and any of its subsidiaries and affiliates
(together, the "Company"), and refrain from conducting yourself in a
manner adversely affecting the Company;
2. Without limiting the generality of the foregoing, while employed by the
Company and for two years following your separation from service with the
Company for any reason, you
Refrain from engaging in any activity in competition with the Company,
whether as an officer, director, employee, consultant, advisor, agent,
broker, independent contractor, partner, shareholder, or principal of
any corporations, partnership, proprietorship, firm, association,
person, or other entity;
Refrain from undertaking any employment or activity wherein the
fulfillment of your duties would call upon you to reveal, to make
judgments on, or otherwise to use any "confidential information" of the
Company;
Refrain from directly or indirectly, either for yourself or for any
other person, diverting or taking away or attempting to divert or take
away (or calling on or soliciting or attempting to call on or solicit)
any of the Company's customers or patrons, including but not limited to
those upon whom you called or whom you solicited or with whom you
became acquainted while employed by the Company;
Refrain from directly or indirectly or by action in concert with
others, inducing or influencing (or seeking to induce or influence) any
person who is engaged (as an employee, agent, independent contractor,
or otherwise) by the Company to terminate his or her employment or
engagement.
IF, IN THE COMMITTEE'S SOLE DISCRETION, IT IS DETERMINED THAT YOU HAVE BREACHED
ANY OF THE FOREGOING CONDITIONS, AFTER NOTICE BY REGISTERED MAIL DIRECTED TO
YOUR LAST KNOWN ADDRESS, ALL OF YOUR OUTSTANDING AWARDS UNDER THE PLAN WILL BE
COMPLETELY TERMINATED. NOTWITHSTANDING ANY OTHER PROVISIONS HEREOF, FOLLOWING OR
IN CONNECTION WITH A CHANGE IN CONTROL, THE FOREGOING CONDITIONS SHALL LAPSE AND
BE OF NO FURTHER FORCE OR EFFECT.
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