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EXHIBIT 10.22
[ LETTERHEAD OF TENNECO ]
July 6, 1998
Mr. Stacy S. Dick
187 West Old Mill Road
Greenwich, Connecticut 06831
Re: Release Agreement
Dear Stacy:
This Release Agreement ("Agreement") entered into as of the date at the end
hereof is by and between Stacy S. Dick ("Employee"),Pamela Dick ("Employee's
Spouse"), and the employer, Tenneco Management Company, ("Employer")
(collectively, "the Parties").
The Parties named above agree as follows:
1. Employee's employment with Employer will terminate on July 31, 1998
(the "Termination Date").
2. Employer shall provide the following to Employee, subject to
applicable tax withholdings and any amounts due the Employer,
conditioned upon final execution of this Agreement and after the
additional seven-day period referred to in paragraph 26:
- Payment - Upon receipt of signed agreement, Employee will
receive a lump sum payment of $848,000, as soon as
administratively feasible after July 31, 1998. This payment
shall be in lieu of any other payments, wages, cost of living
adjustments, and benefits. If either the Employee or
Employee's Spouse fail to execute this Agreement by July 28,
1998, or revoke or cancel this Agreement during the seven-day
period referred to in Paragraph 26, Employer shall not be
obligated to make lump sum payment to
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Employee. If Employee revokes or cancels the Agreement after
Employer has made the lump sum payment, Employee shall be
obligated to return to Employer all benefits and payments
provided to him under this Agreement, including but not
limited to the lump sum payment.
- Business Expenses - Reimbursement for any business expenses
incurred by Employee on behalf of the Employer that have been
submitted for reimbursement in accordance with the Employer's
normal expense account procedures.
- Retirement Plan Vesting - Since Employee is a participant in
the Tenneco Inc. Retirement Plan and has completed five years
of service on the Termination Date, he is 100% vested in his
accrued benefit under the Tenneco Inc. Retirement Plan. For
information regarding Retirement Benefits, the Employee should
call the Benefits Center at 1-800-444-5578.
Employee is also a participant in the Tenneco Inc.
Supplemental Executive Retirement Plan (the "SERP"), and
pursuant to a special agreement covering him, which has been
merged into the SERP, he has been credited with five
additional years of participation. Employee is 100% vested in
his accrued benefit under the SERP. Employee is entitled to
receive the benefit of recently adopted amendments to the SERP
which count certain bonuses for purposes of computing SERP
benefits, which feature was also included in his special
agreement, and which permit lump sum distributions.
- Executive Incentive Compensation Plan - Should the Company
achieve the performance goals for Incentive Award payout, the
Employee will receive a pro-rata adjusted target 1998 award,
payable in 1999. No future awards will be made under this
Plan.
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- 1996 Tenneco Inc. Stock Ownership Plan - Employee has 210,822
options to purchase shares of Tenneco common stock. All such
options shall be deemed exercisable as of August 1, 1998, and
shall remain exercisable until July 31, 2003, provided that,
except to the extent specifically modified herein, all terms
and conditions of the 1996 Tenneco Inc. Stock Ownership Plan
{"SOP"), as it may be amended from time to time, and the Award
Agreements covering such options, as they may be amended from
time to time, shall remain applicable to such options,
including without limitation, the provisions governing the
adjustment and amendment of outstanding options, and, provided
further, that, notwithstanding the terms of the Award
Agreement, Employee shall not be awarded any Reload Stock
Options, as that term is defined in the SOP, upon the exercise
of any such options. No future awards of options will be made
under this Plan.
- Performance Shares - The Employee has been granted 28,000
Performance Shares under the SOP. Employee will not forfeit
such Performance Shares on account of his separation from
service with Employer, and such Performance Shares shall
remain outstanding, and, except as specifically provided
herein, shall continue to be subject to the rules of the SOP
and the Performance Share Award Agreement covering them.
Performance Shares will be distributed to Employee as soon as
administratively feasible based on the number of shares earned
at the end of each applicable four year performance period. No
future awards of Performance Shares will be made under this
Plan.
- Tenneco Inc. Restricted Shares - Employee's 5,530 restricted
shares will vest on the Termination Date. A Stock Certificate
for the appropriate number of shares will be delivered to the
employee as soon as administrative feasible.
- Deferred Compensation - Employee may elect at any time prior
to the Termination Date, the payment of the balance in his
Deferred Compensation Account under the Tenneco Inc. Deferred
Compensation Plan (the "DCP") in either a
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single lump sum distribution payable as soon as
administratively feasible after the Termination Date or in
five (5) annual installments commencing in 1998. If he elects
installments, the rules of the DCP shall continue to apply to
the remaining balance until paid.
- Thrift Plan - Employee is a participant in the Tenneco Inc.
Thrift Plan and contributions to the Tenneco Inc. Thrift Plan
cease upon the termination of Employee's employment. Employee
may then elect to receive a final settlement of his account
balance, usually within four to six weeks following the
receipt of his properly completed election forms. Employee is
100% vested in his account. Apart from an excise tax
applicable to certain large distributions, taxable funds will
be subject to ordinary income taxes and a 10% excise tax if
Employee is under age 59 1/2 at the time of distribution
unless the taxable funds are rolled over to an IRA within
sixty (60) days from the date of distribution. Due to the tax
changes passed effective January 1, 1993, there have been
changes regarding IRA-rollover and federal income tax
withholding provisions. Employee should contact the Benefits
Center for information about his Thrift Plan account,
including any outstanding Thrift Plan loans, and the tax
consequences of his distribution.
- Medical Coverage Continuation - If enrolled in the Tenneco
medical plan at the Termination Date, continued coverage under
the Tenneco medical plan as it may be amended from time to
time will be offered to Employee and Employee's eligible
dependents on an optional basis with your sharing the cost
(after-tax basis) for up to twelve (12) months from the
Termination Date (the "continuation period"). Employee will
remain responsible for any employee contribution required by
his medical coverage choice. In the event Employee enrolls in
a group medical plan of a new employer before the end of his
continuation period, his new coverage will be primary and
Tenneco medical coverage will be secondary as provided in the
medical plan.
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Unless Employee is covered by another group medical plan at
the expiration of the continuation period, he may be able to
continue, completely at his own expense, Tenneco medical
coverage for up to an additional eighteen (18) months under
COBRA. Following termination of Tenneco medical coverage, an
individual medical benefits conversion policy may be
available.
- Dental Coverage Continuation - If enrolled in the Tenneco
dental plan at the Termination Date, coverage under the
Tenneco dental plan as it may be amended from time to time,
(or the DMO option you have elected) will be offered to
Employee and Employee's eligible dependents on an optional
basis with your sharing the cost (after-tax basis) for up to
twelve (12) months from the Termination Date. Employee remain
responsible for any employee contribution required by your
dental coverage choice. In the event Employee enroll in a
group dental plan of a new employer before the end of his
continuation period, Employee's new coverage will be primary
and Tenneco dental coverage will be secondary as provided in
the dental plan.
Unless Employee is covered by another group dental plan at the
expiration of the continuation period, he may be able to
continue, completely at his own expense, Tenneco dental
coverage for up to an additional eighteen (18) months under
COBRA.
- Life Insurance Continuation - Under the Tenneco basic group
life insurance plan as it may be amended from time to time,
Employee's basic life and accidental death and dismemberment
(AD&D) coverage will continue at Company expense for twelve
(12) months from the Termination Date. An individual life
insurance conversion policy may be available following
termination of Tenneco life insurance coverage. Employee may
not continue your supplemental or dependent coverages past the
Termination Date.
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- Disability and Accident Insurance - Employee's participation
in the Tenneco Inc. Long Term Disability and Travel Accident
Insurance Plans ceases upon his termination of employment.
- Other Benefit Plans - Except as set out in this Agreement, the
provisions of the policies or plan documents will control.
- Relocation Loan Modification - The Employer, and the Employee
and Employee's Spouse are parties to a May 1, 1996 Balloon
Note (Fixed Rate)(the "Note") in the principal amount of
$400,000, which Note has a current outstanding principal
balance of $400,000. The Employer hereby forgives $200,000 of
the principal of the Note, leaving a principal balance of the
Note of $200,000. Pursuant to Paragraph 11 of the Note, the
Note Holder, at its sole option, may send notice requiring
payment within 90 days after the Termination Date (as defined
therein) in the event Employee's employment with Tenneco
Management Company or its affiliates is terminated for any
reason. Employee and Employee's Spouse hereby agree that upon
the execution of this Agreement such notice shall be deemed
given hereby by the Employer with respect to the $200,000
balance of the principal plus accrued interest on the Note,
after the forgiveness above. Notwithstanding the foregoing,
the parties hereby further agree that the "maturity date" of
the Note shall be amended to be the earlier of August 1, 2000,
or such time as the Employee and Employee's Spouse divest any
of their interests in the property generally described as 187
West Old Mill Road, Greenwich, Connecticut, by sale, gift,
transfer or otherwise, to any other person or entity.
Notwithstanding anything in the note to the contrary, Tenneco
hereby agrees under Section 3 (c) of the Note that no interest
shall be charged under the Note, except upon a default
described in Section 6(B) of the Note after which interest
shall be charged at the default rate set forth in Section 2 of
the Note and be payable on demand. The parties hereby agree to
execute within five (5) days of the expiration of the seven
day revocation period set forth in paragraph 26
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of this Agreement, a Loan Modification Agreement and Allonge
to Note containing the provisions set forth in this paragraph,
which Loan Modification Agreement and Allonge to Note shall be
recorded with the Recorders Office in Fairfield County,
Connecticut. Copies of such Loan Modification Agreement and
the Allonge to Note are attached hereto as Attachment 1. All
other rights and remedies of Tenneco and its affiliates under
the Note or under the Mortgage serving this Note shall be
preserved and are unaffected by this Agreement.
Notwithstanding the foregoing, Employer agrees that if more
than 90 percent of the Balloon Notes issued by the Employer to
various employees in connection with the relocation of the
Tenneco's Headquarters operations from Houston, Texas to
Greenwich, Connecticut that remain outstanding as of August 1,
1998, are forgiven in whole and canceled by the Employer on or
before August 1, 1999, the Employer shall forgive in whole and
cancel the Note (as defined and modified hereunder) by the
Loan Modification Agreement and Allonge to Note described
above and attached hereto as Attachment 1.
3. Employee acknowledges that his employment shall terminate with
Employer, its direct or indirect subsidiaries, affiliates, parents, and
related companies or entities, regardless of its or their form of
business organization, including without limitation the plans described
in paragraph 6 (all collectively the "Employer Entities"), on or before
July 31, 1998.
4. In exchange for the compensation and benefits described in paragraph 2,
Employee and Employee's Spouse release and discharge any and all
Employer Entities as defined in paragraph 3, and any and all of their
past and present subsidiaries, affiliates, parents, related companies,
persons and entities, directors, employees, officers, agents, partners,
insurers, attorneys, trustees, administrators and fiduciaries (all
collectively the "Released Parties") from any and all claims, demands,
and causes of action, whether arising in contract, tort or any other
theory of action, whether arising in law or equity, whether known or
unknown, accrued or unaccrued, asserted or unasserted, from the
beginning of time up to the effective date of this Agreement, except
for those obligations
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created by or arising out of this Agreement. Nothing contained herein
shall release the Employer Entities from any indemnity obligations it
may have under Delaware law to Employee with respect to his service as
an officer or director of any Employer Entity. Employee and Employee's
Spouse expressly waive the benefit of any statute or rule of law which,
if applied to this Agreement, would otherwise exclude from its binding
effect any claim against any Released Party not now known by Employee
or Employee's Spouse to exist. Except as necessary for Employee and
Employee's Spouse to enforce this Agreement, this Agreement is intended
to be a general release and a covenant not to sue that extinguishes all
claims and precludes any attempt by Employee or Employee's Spouse to
initiate any litigation against any Employer Entity. Without limiting
the generality of this paragraph, if Employee or Employee's Spouse
commence or continue any claim in violation of this Agreement, the
Released Party shall be entitled to assert this Agreement as a bar to
such action or proceeding and shall be entitled to recover its
attorneys' fees and costs of litigation from the party commencing or
continuing the claim, including reasonable compensation for the
services of the internal personnel of the Released Party.
5. Without in any way limiting the generality of the foregoing, this
Agreement is an individually tailored separation agreement and
constitutes a full release and disclaimer of any and all claims arising
out or accruing up to the effective date of this Agreement, including
but not limited to any claims arising out of or in any way connected
with or relating to the termination of Employee's employment and any
claims arising out of or in any way connected with or related to
Employee's employment with Employer or any other Employer Entity up to
the effective date of this Agreement. The scope of this waiver includes
but is not limited to claims arising under 29 U.S.C. Section 1981, the
Age Discrimination in Employment Act of 1967 as amended (29 U.S.C.
Section 621), Title VII of the Civil Rights Act of 1964 as amended, (42
U.S.C. Section 2000e), the Americans With Disabilities Act (42 U.S.C.
Section 12101), the Worker Adjustment Retraining and Notification Act
(29 U.S.C. Section 2101), the Family and Medical Leave Act of 1993 (29
U.S.C. Section 2601), the Connecticut Human Rights and Opportunities
Act, the Connecticut Family and Medical Leave laws (Conn. Gen. Stat.
31-51cc to 31-51gg and Ct. Legis, 96-140, effective January 1, 1997),
the Texas Human Rights Act, (Tex Rev. Civ. Stat. Art. 5221k), the
National Labor
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Relations Act, any claims for breach of contract, wrongful or
retaliatory discharge, tortious action, inaction or interference of any
sort, and any claim under any other state, local or federal statute,
regulation or ordinance, or common law cause of action.
6. It is expressly agreed that the payments described in paragraph 2 of
this Agreement are in full and complete satisfaction of any and all
liabilities or obligations which any Employer Entity, including any
plan, fund or program sponsored, maintained or contributed to by any
Employer Entity, has or may have to Employee and Employee's Spouse
under or with respect to any employee benefit plan described in Section
3(3) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), any payment or other item excluded from the definition of
"employee welfare benefit plan", "employee pension benefit plan" or
"employee benefit plan" under the rules of 29 C.F.R. Section 2510.3-1,
2510.3-2 or 2510.3-3, as the case may be, and any employee benefit plan
described in Section 4 of ERISA. It is further agreed that the payments
described in this Agreement exceed in value anything to which Employee
and Employee's Spouse may be already entitled.
7. Employee and Employee's Spouse represent that neither of them has
assigned or transferred, or purported to assign or transfer, to any
person or entity, any claim or any portion thereof or interest therein
against a Released Party.
8. Employee represents that he has turned over to Employer all originals
and copies of expense reports, notes, memoranda, records, documents,
Employer manuals, credit cards, pass keys, computers, computer
diskettes, office equipment, sales records and data, and all other
information or property, no matter how produced, reproduced or
maintained, which Employee has in his possession and pertain to the
business of any Employer Entity, including but not limited to lists of
customers, prices, marketing plans, strategies, documents relating to
the legal rights and obligations of any Employer Entity, the work
product of any attorney employed or retained by any Employer Entity,
and other confidential materials or information obtained by Employee in
the course of his employment.
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9. Employee acknowledges that the business and services of all Employer
Entities are highly specialized and that the following information is
Confidential Information: proprietary technical and business
information relating to any Employer Entity's plans, analysis or
strategies concerning international or domestic acquisitions, possible
acquisitions or new ventures; development plans or introduction plans
for products or services; unannounced products or services; operation
costs; pricing of products or services; research and development;
personnel information; manufacturing processes; installation, service
and distribution procedures and processes; customer lists; any
know-how relating to the design, manufacture, and marketing of any
Employer Entity's services and products, including components and
parts thereof; non-public information acquired by Employee concerning
the requirements and specifications of any Employer Entity's agents,
vendors, contractors, customers and potential customers; non-public
financial information, business and marketing plans, pricing and price
lists; non-public matters relating to employee benefit plans;
quotations or proposals given to agents or customers or received from
suppliers; documents relating to any Employer Entity's legal rights
and obligations; the work product of any attorney employed by or
retained by any Employer Entity; and any other information which is
sufficiently secret to derive economic value from not being generally
known. No information shall be Confidential Information that is, or
becomes, generally available to the public other than as a result of
Employee's disclosure or that becomes available to Employee on a
nonconfidential basis from a source other than the Employee.
10. Employee shall maintain in the strictest confidence and will not,
directly or indirectly, use, intentionally or inadvertently, publish
or otherwise disclose to any person or entity whatever, any trade
secrets, or any confidential, proprietary or other non-public
information of or belonging to any Employer Entity or any agent, joint
venturer, contractor, customer, vendor or supplier of any Employer
Entity (collectively, the "Confidential Information"), regardless of
its form without the prior written explicit consent of Employer.
Employee shall take reasonable precautions to protect the inadvertent
disclosure of Confidential Information. Employee's obligations under
this Agreement with respect to Confidential Information shall extend
for the period that such information is not generally known outside of
the relevant Employer Entity for reasons other than disclosure or
disclosures made by or on
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behalf of Employee. All duties and obligations set forth in this
Agreement shall be in addition to those which exist under statute and
at common law and shall not negate but shall be in addition to or
coextensive with those obligations arising under any agreements or
documents executed by Employee during his employment with Employer.
Should Employee be served with legal process seeking to compel
disclosure of any such information, Employee shall notify the General
Counsel of Employer immediately.
11. Paragraphs 9 and 10 hereof shall be deemed to consist of a series of
separate covenants. Should a determination be made by a court of
competent jurisdiction that the character, duration, or geographical
scope of those provisions are unreasonable in light of the
circumstances as they then exist, then it is the intention and the
agreement of Employer and Employee that these shall be construed by
the court in such a manner as to impose only those restrictions on
Employee's conduct which are reasonable in light of the circumstances
as they then exist and as are necessary to assure the relevant
Employer Entity of their intended benefit. If, in any judicial
proceeding, a court shall refuse to enforce all of the separate
covenants because, taken together, they are more extensive than
necessary to assure the relevant Employer Entity of the intended
benefit, then it is expressly understood and agreed that those of such
covenants which, if modified or eliminated, would permit the remaining
separate covenants to be enforced in such proceeding, shall, for the
purpose of such proceeding, be deemed modified or eliminated in order
to enforce the remaining provisions.
12. Nothing in this Agreement shall be construed as an admission of any
wrongdoing by any person or entity.
13. The Parties agree to cooperate fully and to execute any and all
supplementary documents and to take all additional actions that may be
necessary or appropriate to give full force to the terms and intent of
this Agreement that are not inconsistent with its terms.
14. Employee shall provide thorough and accurate information and testimony
voluntarily to or on behalf of any Employer Entity, regarding any
investigation or court case initiated by or against any Employer
Entity or by any government agency, but he agrees not to disclose or
to discuss with anyone who is not directing or assisting in any
Employer
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Entity investigation or case, other than his attorney, the fact of or
the subject matter of any investigation, except as required by law.
Employee will cooperate with the Employer Entity and promptly provide
such information. If the Employer Entity requests information, it will
attempt to work with Employee to arrange times that reasonably
accommodate him, and will reimburse Employee for commuting, parking or
other similar expenses and, to the extent permitted by law, will
reasonably compensate Employee for any significant imposition on his
time by the request.
15. Employee acknowledges that any employment or contractual relationship
between Employee and any and all Employer Entities, including but not
limited to the Employer, will terminate by virtue of this Agreement on
or before July 31, 1998. In consideration of this Agreement, Employee
waives any and all employment rights that Employee now has with any
Employer Entity, except as otherwise expressly provided in this
Agreement. Employee agrees not to seek reinstatement, reemployment, or
future employment as a new employee, and no Employer Entity has an
obligation, contractual or otherwise, to employ or reemploy, hire or
rehire, or recall or reinstate Employee in the future.
16. Employee and Employee's Spouse agree to keep confidential the terms,
conditions, and amounts set forth in this Agreement, except to their
attorneys, accountants, and tax advisors, and not to disclose any
information relating to this Agreement to any employee or former
employee of any Employer Entity except as required by law or a court
of competent jurisdiction. The Employer and all Employer Entities
hereby agree to keep confidential the terms, conditions, and amounts
set forth in this Agreement, except as required by law or a court of
competent jurisdiction.
17. It is further agreed that if any provision of this Agreement
contravenes the law of any state or jurisdiction where this Agreement
is to be performed or enforced, such provision shall be deemed not to
be a part of this Agreement, and the other provisions of this
Agreement, shall remain in full force and effect.
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18. The failure of the Employer to exercise any rights under this
Agreement upon any breach or threatened breach by Employee or
Employee's Spouse shall not constitute a waiver of any rights arising
by reason of other or similar breaches.
19. Employee and Employee's Spouse shall have no right of assignment or
transfer of any rights herein or any sums that may accrue to them
hereunder, nor shall any creditor or other claimant have any right to
assert any interest in or right to receive such sums either by
voluntary or involuntary act on their part, by any writ or garnishment
or attachment or otherwise.
20. This Agreement shall be deemed to have been executed and delivered
within the State of Connecticut and the rights and obligations of the
Parties shall be construed and enforced in accordance with, and
governed by, the laws of the State of Connecticut without regard to
that state's rules regarding conflict of laws. The language of all
parts of this 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.
21. Employer and all Employer entities waive any claims now known to them
that might be asserted by them against Employee or Employee's Spouse
arising out of the employment relationship.
22. Employee and Employee's Spouse acknowledge and warrant that they are
unaware of any claim which may be asserted by themselves or any other
person in connection with Employee's employment with the Employer or
the termination thereof. This Agreement shall be binding upon and
inure to the benefit of the respective successors, heirs, assigns,
administrators, executors and legal representatives of the Parties and
other entities described in this Agreement.
23. Employee and Employee's Spouse warrant that no promise or inducement
to enter into this Agreement has been offered or made except as set
forth in this Agreement, that each is entering into this Agreement
without any threat or coercion and without reliance on any statement
or representation made on behalf of any Employer Entity or by any
person employed by or representing any Employer Entity, except for the
written provisions and promises contained in this Agreement.
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24. This Agreement constitutes the entire agreement and understanding
between the Parties with regard to all matters, including but not
limited to Employee's employment, the cessation of his employment from
Employer, payments owed to him and his spouse as a result thereof, and
the other subject matters addressed in this Agreement. This Agreement
supersedes and replaces all prior commitments, negotiations and all
agreements proposed or otherwise, whether written or oral, concerning
the subject matters contained in this Agreement. This Agreement is an
integrated document and the consideration stated herein is the sole
consideration for this Agreement.
25. This Agreement is being delivered to Employee and Employee's Spouse on
July 6,1998. Employee and Employee's Spouse shall have until July 28,
1998, to decide whether to sign the Agreement and be bound by its
terms.
26. In addition, the Parties agree that even after signing the Agreement,
Employee and Employee's Spouse shall have the right to revoke or
cancel it only within seven days after signing it. This cancellation
or revocation can be accomplished by delivery of a written
notification if Employee or Employee's Spouse wishes to revoke the
Agreement to the Vice President of Human Resources. In the event that
this Agreement is canceled or revoked by Employee or Employee's
Spouse, Employer shall have no obligation to meet the commitments
described in this Agreement.
27. Employee and Employee's Spouse acknowledge that they each have been
advised and encouraged by Employer to consult their own attorney prior
to signing this Agreement, and that the Employee and Employee's Spouse
execute this Agreement voluntarily.
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28. Employee and Employee's Spouse acknowledge that they each have read
this Agreement and that the Employee and Employee's Spouse understand
that the Agreement will have the effect of waiving any action or
recovery they might pursue, including breach of contract, personal
injury, discrimination on the basis of race, age, sex, national
origin, citizenship, religion, veteran status, handicap, or disability
and any other claims arising prior to the date of the Agreement,
Sincerely,
/s/ Stephen J. Smith
Stephen J. Smith
Vice President, Human Resources
APPROVED BY:
/s/ Dana G. Mead
--------------------------------
Dana G. Mead
Chief Executive Officer
Date:
AGREED AND ACCEPTED:
/s/ Stacy S. Dick Date: 7/21/98
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Stacy S. Dick
/s/ Pamela Dick Date: 7/21/98
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Pamela Dick
Attachment