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EXHIBIT 10(H)
RELEASE AND SETTLEMENT AGREEMENT
THIS RELEASE AND SETTLEMENT AGREEMENT (this "Agreement") is made and
entered into by and between THE LINCOLN ELECTRIC COMPANY (the "Company," a term
which in this Agreement shall include its predecessors, parents, subsidiaries,
divisions, related or affiliated companies, officers, directors, stockholders,
members, employees, heirs, successors, assigns, representatives, agents and
counsel, unless the context otherwise clearly requires), and ROGER F. YOUNG
("Young"),
WITNESSETH:
WHEREAS, Young is an employee of the Company and currently serves as Senior
Vice President, Administration and as a Director of the Company;
WHEREAS, the Company and Young have determined that Young shall resign and
retire from any and all positions he may hold as an officer, director and
employee of, and any other positions he may hold with respect to, the Company,
effective July 31, 1994 (the "Effective Date");
WHEREAS, the Company and Young desire to make provision for the payments
and benefits that Young will be entitled to receive from the Company in
consideration for Young's obligations and actions under this Agreement and in
connection with such resignations and retirement and the cessation of his
employment with the Company; and
WHEREAS, the Company and Young wish to resolve, settle and/or compromise
any and all matters, claims and issues between them arising from or relating to
Young's service and employment with the Company, including the termination
thereof;
NOW THEREFORE, in consideration of the promises and agreements contained
herein and other good and valuable consideration, the sufficiency and receipt of
which are hereby acknowledged, and intending to be legally bound, the Company
and Young agree as follows:
1. RESIGNATION. Young hereby resigns and retires from his employment with
the Company, and its subsidiaries and related or affiliated companies, as of the
Effective Date. Young also resigns, as of the Effective Date, (a) from the Board
of Directors of the Company, and from the Board of Directors of any entity that
is a subsidiary of, or is otherwise related to or affiliated with, the Company,
(b) from all offices of the Company to which he has been elected by the Board of
Directors of the Company (or to which he has otherwise been appointed), (c) from
all offices of any entity that is a subsidiary of, or is otherwise related to or
affiliated with, the Company and (d) from all administrative, fiduciary or other
positions he may hold with respect to arrangements or plans for, of or relating
to the Company. The Company hereby consents to and accepts said resignations as
of the Effective Date, and the Company records shall so reflect.
2. PAYMENTS. (a) In consideration of the promises of Young in this
Agreement and subject to the conditions hereof, the Company shall:
(i) Pay Young (X) on the 15th and last day of each month for five (5)
months commencing on August 15, 1994 and ending on December 31, 1994 a
gross amount of FOUR THOUSAND EIGHT HUNDRED FORTY-THREE DOLLARS ($4,843.00)
and (Y) on the 15th and last day of each month for twenty-four (24) months
commencing on January 15, 1995 and ending on December 31, 1996 a gross
amount of EIGHT THOUSAND, SIX HUNDRED SIX & 89/100 DOLLARS ($8,606.89);
provided that the continuance of such payments is contingent upon Young's
compliance with the requirements of this Agreement applicable to him; and
provided further that if Young dies before the completion of the payments
described in this subparagraph 2(a)(i), the remaining payments described in
this subparagraph 2(a)(i) following his death shall be made to his estate.
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(ii) Pay Young (or his estate in the event of his death before
December 31, 1994) on December 31, 1994 a lump sum gross amount equal to
TWO HUNDRED SIX THOUSAND, FIVE HUNDRED SIXTY-FIVE & 22/100 DOLLARS
($206,565.22) reduced by the sum of the gross salary received by Young from
the Company in 1994 and the payments described in subparagraph 2(a)(i)(X)
of this Agreement;
(iii) Pay Young a supplemental pension of NINETEEN THOUSAND, TWO
HUNDRED TWENTY-FIVE DOLLARS ($19,225.00) per year in equal monthly
installments, payable in the form of a single life annuity, commencing with
a payment on January 1, 1997 and ending with a payment on the first day of
the month in which Young dies (the "Pension"); provided that in the event
the Company adopts a supplemental executive retirement plan or similar
arrangement, the Pension may, at the option of the Company, be paid through
such plan or arrangement (but no other benefit shall be payable to or with
respect to Young under any such plan or arrangement); and provided further
that if the Company adopts such a plan or arrangement and if such plan or
arrangement provides for an actuarially equivalent survivor annuity in lieu
of a straight life annuity, Young may elect to receive the Pension in the
form of such actuarially equivalent survivor annuity (such actuarial
equivalence being determined in accordance with the terms of such plan or
arrangement).
(iv) Continue to permit Young to participate in the Company's life
insurance programs, on the same basis that Young has participated in such
life insurance programs prior to the termination of his employment with the
Company, until the earlier of December 31, 1996, or the date on which Young
becomes eligible for other employer-provided life insurance. Young
acknowledges and agrees that he currently is eligible for Medicare and
that, accordingly, his rights to continuation of coverage under the
Company's group health plan pursuant to Part 6 of Subtitle B of Title I of
the Employee Retirement Income Security Act of 1974, as amended ("COBRA"),
will cease upon his resignation and retirement under this Agreement.
However, Young will be entitled to participate in the Company program
through which retirees, at their cost (as determined by the Company), may
elect to have coverage under the Company's medical program that is
secondary to Medicare.
(b) Young acknowledges and agrees that he shall be responsible for his
share of any and all Federal, State and/or local taxes applicable to the
payments made, and benefits provided or made available, to Young pursuant to
this Paragraph 2 and further agrees to indemnify the Company against any
liability as a result of those taxes.
(c) The payments to Young pursuant to subparagraphs 2(a)(i), 2(a)(ii) and
2(a)(iii) of this Agreement shall be made by check or direct deposit to an
account designated by Young, and shall be reduced by any applicable Federal,
State and local tax or other required withholding. The payments to Young
pursuant to subparagraph 2(a)(i) of this Agreement (and, with respect to medical
insurance for 1994, pursuant to subparagraph 2(a)(ii) of this Agreement) shall
be reduced by any applicable deductions resulting from Young's election to
participate in the Company's medical and/or life insurance programs as described
in subparagraph 2(a)(iv) of this Agreement.
(d) Young acknowledges and agrees that the consideration provided by the
Company to Young under this Agreement, including, without limitation, the
payments and benefits to be made or provided by the Company to Young pursuant to
this Agreement, is greater than and in addition to anything of value to which he
otherwise would be entitled from the Company and that the release by Young set
forth in Paragraph 4 of this Agreement and the obligations of and actions taken
by Young under this Agreement are given and undertaken in consideration of, and
adequately supported by, the payments and benefits to be made or provided to
Young by the Company under and pursuant to this Agreement.
3. PROFESSIONAL FEES. The Company and Young acknowledge and agree that each
shall be responsible for the payment of their respective legal fees and costs
(and related disbursements) incurred in connection with Young's termination and
resignation and all matters relating to the negotiation and execution of this
Agreement.
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4. RELEASE BY YOUNG. (a) Young, for himself and his dependents, successors,
assigns, heirs, executors and administrators (and his and their legal
representatives of every kind), hereby releases, dismisses, remises and forever
discharges the Company from any and all arbitrations, claims, including claims
for attorney's fees, demands, damages, suits, proceedings, actions and/or causes
of action of any kind and every description, whether known or unknown, which
Young now has or may have had for, upon, or by reason of any cause whatsoever
(except that this release shall not apply to the obligations of the Company
arising under this Agreement) ("claims"), against the Company, including but not
limited to:
(i) any and all claims arising out of or relating to Young's
employment by or service with the Company and his termination from the
Company;
(ii) any and all claims of discrimination, including but not limited
to claims of discrimination on the basis of sex, race, age, national
origin, marital status, religion or handicap, including, specifically, but
without limiting the generality of the foregoing, any claims under Title
VII of the Civil Rights Act of 1964, as amended, the Americans with
Disabilities Act, Ohio Revised Code Section 4101.17 and Ohio Revised Code
Chapter 4112, including Sections 4112.02 and 4112.99 thereof; and
(iii) any and all claims of wrongful or unjust discharge or breach of
any contract or promise, express or implied.
(b) Young understands and acknowledges that the Company does not admit any
violation of law, liability or invasion of any of his rights and that any such
violation, liability or invasion is expressly denied. The consideration provided
under this Agreement is made for the purpose of settling and extinguishing all
claims and rights (and every other similar or dissimilar matter) that Young ever
had or now may have against the Company to the extent provided in this Paragraph
4. Young further agrees and acknowledges that no representations, promises or
inducements have been made by the Company other than as appear in this
Agreement.
(c) Young further agrees and acknowledges that:
(i) The release provided for in this Paragraph 4 releases claims to
and including the date of this Agreement;
(ii) He fully understands the terms of this Agreement, and enters into
this Agreement freely, voluntarily and intending to be bound; and
(iii) He has been given a reasonable period of time in which to review
and consider the terms of this Agreement, and the release contained herein,
prior to its execution.
(d) Young agrees that he will never file a lawsuit or other complaint
asserting any claim that is released in this Paragraph 4.
(e) It is understood and agreed that Young's resignation and retirement are
by mutual agreement between the Company and Young, and that Young waives and
releases any claim that he has or may have to reemployment.
5. CONFIDENTIAL INFORMATION. (a) Young acknowledges and agrees that in the
performance of his duties as an officer and employee of the Company he was
brought into frequent contact with, had or may have had access to, and/or became
informed of confidential and proprietary information of the Company and/or
information which is a trade secret of the Company (collectively, "Confidential
Information"), as more fully described in subparagraph (b) of this Paragraph 5.
Young acknowledges and agrees that the Confidential Information of the Company
gained by Young during his association with the Company was developed by and/or
for the Company through substantial expenditure of time, effort and money and
constitutes valuable and unique property of the Company.
(b) Young will keep in strict confidence, and will not, directly or
indirectly, at any time, disclose, furnish, disseminate, make available, use or
suffer to be used in any manner any Confidential Information of the Company
(except as may be necessary in connection with the discharge of Young's
obligations pursuant to
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Paragraph 8 of this Agreement) without limitation as to when or how Young may
have acquired such Confidential Information. Young specifically acknowledges
that Confidential Information includes any and all information, whether reduced
to writing (or in a form from which information can be obtained, translated, or
derived into reasonably usable form), or maintained in the mind or memory of
Young and whether compiled or created by the Company, which derives independent
economic value from not being readily known to or ascertainable by proper means
by others who can obtain economic value from the disclosure or use of such
information, that reasonable efforts have been put forth by the Company to
maintain the secrecy of Confidential Information, that such Confidential
Information is and will remain the sole property of the Company, and that any
retention or use by Young of Confidential Information after the termination of
Young's employment with and services for the Company shall constitute a
misappropriation of the Company's Confidential Information.
(c) Young further agrees that he shall return (to the extent he has not
already returned), within ten (10) days of the Effective Date, in good
condition, all property of the Company, including, without limitation, (i)
property, documents and/or all other materials (including copies, reproductions,
summaries and/or analyses) which constitute, refer or relate to Confidential
Information of the Company, (ii) keys to Company property, (iii) files and (iv)
blueprints or other drawings.
(d) Young further acknowledges and agrees that his obligation of
confidentiality shall survive, regardless of any other breach of this Agreement
or any other agreement, by any party hereto, until and unless such Confidential
Information of the Company shall have become, through no fault of Young,
generally known to the public or Young is required by law (after providing the
Company with notice and opportunity to contest such requirement) to make
disclosure. Young's obligations under this Paragraph 5 are in addition to, and
not in limitation or preemption of, all other obligations of confidentiality
which Young may have to the Company under general legal or equitable principles
or statutes.
6. NON-COMPETITION. (a) Young agrees that for a period of two (2) years
from and after the Effective Date, within the Territory (as described in
subparagraph (b)(i) of this Paragraph 6) (and, as to subparagraph (a)(iii) of
this Paragraph 6, any place), he shall not, directly or indirectly, do or suffer
any of the following:
(i) Own, manage, control or participate in the ownership, management,
or control of, or be employed or engaged by or otherwise affiliated or
associated as a consultant, independent contractor or otherwise with, any
other corporation, partnership, proprietorship, firm, association, or other
business entity, or otherwise engage in any business, which is in
competition with the Company's business (as described in subparagraph
(b)(ii) of this Paragraph 6); provided, however, that the ownership of not
more than one percent (1%) of any class of publicly-traded securities of
any entity shall not be deemed a violation of this Agreement.
(ii) Employ, assist in employing, or otherwise associate in business
with any person who presently is an employee, officer or agent of the
Company, or any of its affiliated, related or subsidiary entities.
(iii) Induce any person who is an employee, officer or agent of the
Company, or any of its affiliated, related, or subsidiary entities to
terminate such relationship.
(b) For purposes of this Agreement:
(i) "Territory" shall mean the countries identified in Exhibit A
hereto.
(ii) The Company's business shall mean the design, manufacture,
distribution and sale of the products identified in Exhibit B hereto.
(c) In the event Young shall violate any provision of this Paragraph 6 as
to which there is a specific time period during which he is prohibited from
taking certain actions or from engaging in certain activities, as set forth in
such provision, then, in such event, such violation shall toll the running of
such time period from the date of such violation until such violation shall
cease.
(d) Young has carefully considered the nature and extent of the
restrictions upon him and the rights and remedies conferred upon the Company
under this Paragraph 6 and this Agreement, and hereby acknowledges
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and agrees that the same are reasonable in time and territory, are designed to
eliminate competition which otherwise would be unfair to the Company, do not
stifle the inherent skill and experience of Young, would not operate as a bar to
Young's sole means of support, are fully required to protect the legitimate
interests of the Company and do not confer a benefit upon the Company
disproportionate to the detriment to Young.
7. DISCLOSURE. Young, for a period of two (2) years from and after the
Effective Date, agrees to communicate the contents of Paragraphs 5, 6, 8(b), 9
and 11 of this Agreement to any person, firm, association, or corporation which
he intends to be employed by, associated in business with, or represent.
8. BREACH. (a) If Young breaches any of the provisions of this Agreement,
then the Company may, at its sole option, (1) immediately terminate all
remaining payments and benefits described in subparagraphs 2(a)(i), 2(a)(ii) and
2(a)(iv) of this Agreement and (2) obtain reimbursement from Young of all
payments and benefits already provided pursuant to subparagraphs 2(a)(i),
2(a)(ii) and 2(a)(iv) of this Agreement, plus any expenses and damages incurred
as a result of the breach, with the remainder of this Agreement, and all
promises and covenants herein, remaining in full force and effect.
(b) Young acknowledges and agrees that the remedy at law available to the
Company for breach by Young of any of his obligations under Paragraphs 5 and 6
of this Agreement would be inadequate and that damages flowing from such a
breach would not readily be susceptible to being measured in monetary terms.
Accordingly, Young acknowledges, consents and agrees that, in addition to any
other rights or remedies which the Company may have at law, in equity or under
this Agreement, upon adequate proof of Young's violation of any provision of
Paragraph 5 or 6 of this Agreement, the Company shall be entitled to immediate
injunctive relief and may obtain a temporary order restraining any threatened or
further breach, without the necessity of proof of actual damage.
9. CONTINUED AVAILABILITY AND COOPERATION. (a) Young shall cooperate fully
with the Company and with the Company's counsel in connection with any present
and future actual or threatened litigation or administrative proceeding
involving the Company that relates to events, occurrences or conduct occurring
(or claimed to have occurred) during the period of Young's employment by the
Company. This cooperation by Young shall include, but not be limited to:
(i) making himself reasonably available for interviews and discussions
with the Company's counsel as well as for depositions and trial testimony;
(ii) if depositions or trial testimony are to occur, making himself
reasonably available and cooperating in the preparation therefor as and to
the extent that the Company or the Company's counsel reasonably requests;
(iii) refraining from impeding in any way the Company's prosecution or
defense of such litigation or administrative proceeding; and
(iv) cooperating fully in the development and presentation of the
Company's prosecution or defense of such litigation or administrative
proceeding.
(b) For two (2) years from and after the Effective Date, Young shall
continue to provide cooperation to the Company with respect to projects
undertaken by the Company where Young's prior knowledge with respect to, or
prior involvement in, such or similar projects would be relevant to the
advancement of such projects; provided that such cooperation shall not require
more than twenty (20) days of Young's time per calendar year.
(c) Young shall be reimbursed by the Company for reasonable travel,
lodging, telephone and similar expenses incurred in connection with such
cooperation, which the Company shall reasonably endeavor to schedule at times
not conflicting with the reasonable requirements of any future employer of
Young, or with the requirements of any third party with whom Young has a
business relationship that provides remuneration to Young. Young shall not
unreasonably withhold his availability for such cooperation.
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10. SUCCESSORS AND BINDING AGREEMENT. (a) This Agreement shall be binding
upon and inure to the benefit of the Company and any successor of or to the
Company, including, without limitation, any persons acquiring directly or
indirectly all or substantially all of the business and/or assets of the Company
whether by purchase, merger, consolidation, reorganization or otherwise (and
such successor shall thereafter be deemed included in the definition of "the
Company" for purposes of this Agreement), but shall not otherwise be assignable
or delegable by the Company.
(b) This Agreement shall inure to the benefit of and be enforceable by
Young's personal or legal representatives, executors, administrators,
successors, heirs, distributees and/or legatees.
(c) This Agreement is personal in nature and none of the parties hereto
shall, without the consent of the other parties, assign, transfer or delegate
this Agreement or any rights or obligations hereunder except as expressly
provided in subparagraphs (a) and (b) of this Paragraph 10.
(d) This Agreement is intended to be for the exclusive benefit of the
parties hereto, and except as provided in subparagraphs (a) and (b) of this
Paragraph 10, no third party shall have any rights hereunder.
11. NON-DISCLOSURE; STATEMENTS TO THIRD PARTIES. (a) Except to the extent
that this Agreement or the terms hereof become publicly known or available
because of legally mandated disclosure and filing requirements of the Securities
and Exchange Commission, or because of any other legal requirement that this
Agreement or the terms hereof be disclosed or filed with a governmental
instrumentality or agency, all provisions of this Agreement and the
circumstances giving rise hereto are and shall remain confidential and shall not
be disclosed to any person not a party hereto (other than (i) Young's spouse,
(ii) each party's attorney, financial advisor and/or tax advisor to the extent
necessary for such advisor to render appropriate legal, financial and tax
advice, and (iii) persons or entities that fall within the scope of Paragraph 7
of this Agreement, but only to the extent required thereby), except as necessary
to carry out the provisions of this Agreement, and except as may be required by
law.
(b) Because the purpose of this Agreement is to settle amicably any and all
potential disputes or claims among the parties, neither Young nor the Company
shall, directly or indirectly, make or cause to be made any statements to any
third parties criticizing or disparaging the other or commenting on the
character or business reputation of the other. Young further hereby agrees not
(1) to comment to others concerning the status, plans or prospects of the
business of the Company, or (2) to engage in any act or omission that would be
detrimental, financially or otherwise, to the Company, or that would subject the
Company to public disrespect, scandal or ridicule.
12. NOTICES. For all purposes of this Agreement, all communications
provided for herein shall be in writing and shall be deemed to have been duly
given when delivered, addressed to the Company (to the attention of the Vice
President of Human Resources) at its principal executive offices and to Young at
his principal residence, 33960 Meadow Lane, Chagrin Falls, OH 44022, or to such
other address as any party may have furnished to the other in writing and in
accordance herewith. Notices of change of address shall be effective only upon
receipt.
13. MISCELLANEOUS. The death or disability of Young following the execution
of this Agreement shall not affect or revoke this Agreement or any of the
obligations of the parties hereto. No provision of this Agreement may be
modified, waived or discharged unless such waiver, modification or discharge is
agreed to in writing signed by Young and the Company. No waiver by either party
hereto at any time of any breach by the other party hereto or compliance with
any condition or provision of this Agreement to be performed by such other party
shall be deemed a waiver of similar or dissimilar provisions or conditions at
the same or at any prior or subsequent time. No agreements or representations,
oral or otherwise, expressed or implied with respect to the subject matter
hereof have been made by any of the parties that are not set forth expressly in
this Agreement and every one of them (if, in fact, there have been any) is
hereby terminated without liability or any other legal effect whatsoever.
14. ENTIRE AGREEMENT. This Agreement shall constitute the entire agreement
among the parties hereto with respect to the subject matter hereof and shall
supersede all prior verbal or written agreements, covenants,
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communications, understandings, commitments, representations or warranties,
whether oral or written, by any party hereto or any of its representatives
pertaining to such subject matter.
15. GOVERNING LAW. The validity, interpretation, construction and
performance of this Agreement shall be governed by the substantive laws of the
State of Ohio, without giving effect to the principles of conflict of laws of
such state.
16. VALIDITY. The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement which shall nevertheless remain in full force and effect.
17. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same Agreement.
18. CAPTIONS AND PARAGRAPH HEADINGS. Captions and paragraph headings used
herein are for convenience and are not part of this Agreement and shall not be
used in construing it.
19. FURTHER ASSURANCES. Each party hereto shall execute such additional
documents, and do such additional things, as may reasonably be requested by the
other party to effectuate the purposes and provisions of this Agreement.
[This space intentionally left blank.]
IN WITNESS WHEREOF, the parties have executed and delivered this Agreement
on the last date set forth below.
THE LINCOLN ELECTRIC COMPANY
By: _________________________
Donald F. Hastings
Chairman of the Board and
Chief Executive Officer
Date: ___________________
Witness: ________________________ _________________________
ROGER F. YOUNG
Date: ___________________
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EXHIBIT A
United States
Canada
Mexico
Brazil
Venezuela
England
France
Germany
Ireland
Italy
Japan
Netherlands
Norway
Spain
Australia
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EXHIBIT B
I. Arc Welding Machines ranging from light duty models for light industrial
and farm use to heavy duty models for commercial and industrial use in
manual, semi-automatic, automatic and robotic welding.
II. Arc Welding Consumables: Welding rods, fluxes and wires used in light to
heavy manufacturing of mild steel, alloy and hard surface applications;
coated manual or stick electrodes; solid electrodes produced in coil form
for continuous feeding in mechanized welding; cored electrodes produced in
coil form for continuous feeding in mechanized welding; submerged arc
electrodes and fluxes; self-shielded cored electrodes; gas-shielded solid
and cored electrodes.
III. Arc Welding Power Sources and Automated Wire Feeding Systems.
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