Annual Report — Form 10-K
Filing Table of Contents
Document/Exhibit Description Pages Size
1: 10-K Annual Report 27 106K
2: EX-2 Agreement and Plan of Merger 75 214K
3: EX-4.I Form of 6-7/8% Notes Due November 1, 2006 4 23K
4: EX-10.F Mdc Senior Executive Financial/Legal Services Plan 4 13K
5: EX-10.G Deferred Comp. Plan for Nonemployee Directors 7 29K
6: EX-10.L Employment Agreement 12 46K
7: EX-10.M Restricted Stock Award Agreement 3 18K
8: EX-10.N Form of Termination Benefits Agreement 21 95K
9: EX-10.O Settlement Agreement 9 39K
10: EX-10.P Settlement Agreement 10 40K
11: EX-10.S Form of 1997 Pars Agreement-Service Based 4 20K
12: EX-10.T Form of 1997 Pars Agreement - Performance Based 5 23K
13: EX-11 Computation of Earnings Per Share 1 7K
14: EX-12 Computation of Ratio of Earnings to Fixed Charges 1 9K
15: EX-13 Annual Report to Shareholders 69 254K
16: EX-21 Subsidiaries 1 8K
17: EX-23 Consents of Independent Auditors 2 13K
18: EX-27 Financial Data Schedule 1 9K
EX-10.O — Settlement Agreement
| EX-10.O | 1st Page of 9 | TOC | ↑Top | Previous | Next | ↓Bottom | Just 1st |
|---|
1
SETTLEMENT AGREEMENT AND
GENERAL AND SPECIAL RELEASE
1. PARTIES. The parties to this Settlement Agreement and General and Special
Release ("Agreement") are:
(a) Herbert J. Lanese (hereinafter "Lanese"), and
(b) McDonnell Douglas Corporation ("MDC").
2. RECITALS. This Agreement is entered into to effectuate Lanese's separation
from MDC, and the parties, through this Agreement, except as expressly
provided for herein agree to fully and finally settle all claims, known and
unknown, that either party may have against the other arising from Lanese's
relationship with MDC and MDC's relationship with Lanese, including, but
not limited to, claims relating to Lanese's employment, his separation and
the terms and scope of monetary payments made by, or required to be made
by, MDC to him under this and any other agreement by and between MDC and
Lanese.
3. CONTRACTUAL TERMS. In consideration of the terms and covenants of this
Agreement, MDC agrees to permit, perform, allow or facilitate certain acts
on Lanese's behalf and to pay certain monies, all as more fully set out
below:
(a) Lanese's termination of employment was effective as of October 27,
1996;
(b) Lanese will receive a payment under MDC's Senior Executive Performance
Sharing Plan ("PSP") equal to his Performance Adjusted Target
Incentive Compensation Award (PAT), determined during the first
quarter of 1997, subject to normal taxation and withholdings, which
payment shall be in complete satisfaction of any award under PSP for
the Plan Year 1996. Payment under this paragraph shall issue in
accordance with MDC's normal PSP cycle;
(c) Promptly following his termination on October 27, 1996, Lanese will
receive a lump-sum payment for all accrued and unused vacation days,
subject to normal taxation and withholding;
(d) The number of restricted shares of MDC stock granted under the two
Performance Accelerated Restricted Stock ("PARS") Agreements between
Lanese and MDC dated February 16, 1994, shall remain unchanged.
Subject to the provisions of paragraphs 4(c) and 5(c) herein, shares
shall vest or be forfeited in accordance with the terms of the PARS
Agreements as if Lanese was still employed by MDC through the
Performance Periods;
(e) The number of restricted shares of MDC stock granted under the
Performance Accelerated Restricted Stock ("PARS") Agreement between
Lanese and MDC dated March 20, 1995, shall be reduced from 30,000 to
20,000 shares. Subject to the provisions of paragraphs 4(c) and 5(c)
herein, such reduced number of shares shall vest or be forfeited in
accordance with the terms of the PARS Agreement as if Lanese was still
employed by MDC through the Performance Periods;
2
(f) The number of restricted shares of MDC stock granted under the
Performance Accelerated Restricted Stock ("PARS") Agreement between
Lanese and MDC dated February 1, 1996, shall be reduced from 24,000
(A) to 8,000 shares if payment of shares vest and are to be paid in
their entirety pursuant to said PARS Agreement in 1999 and if Lanese
does not obligate MDC to pay for any outplacement services pursuant to
paragraph 3(g) below or (B) 4,000 shares either if any of the shares
vest and are to be paid in 2002 pursuant to said PARS Agreement or if
Lanese obligates MDC to pay for any outplacement services pursuant to
paragraph 3(g) below. Subject to the provisions of paragraphs 4(c) and
5(c) herein, such reduced number of shares shall vest or be forfeited
in accordance with the terms of the PARS Agreement as if Lanese was
still employed by MDC through the Performance Periods;
(g) At Lanese's election, MDC will pay up to $150,000 at no greater than
standard rates to an outplacement firm designated by Lanese for
outplacement services provided to him, prior to January 1, 1998.
(h) Any Long Term Incentive Plan (LTIP) or Performance Sharing Plan annual
incentive compensation amounts that previously would have been paid to
Lanese but were deferred because they would not have been deductible
due to the compensation cap of Internal Revenue Code Section 162(m)
(the "162(m) Deferral"), together with additional amounts otherwise
payable to him from such deferrals shall continue to be deferred (the
"Total Deferral"). The deferred amounts included in the Total Deferral
will continue to earn interest at 11% until December 31, 1996;
thereafter, the Total Deferral will earn 7% interest compounded
quarterly during the deferral period. Subject to the provisions of
paragraphs 4(c) and 5(c) herein, one-third of the Total Deferral and
interest shall be paid to Lanese by MDC on the first business day of
January, 1998; one-half of the remaining Total Deferral and interest
shall be paid to Lanese by MDC on the first business day of January,
1999; and the balance of the Total Deferral and interest shall be paid
to Lanese by MDC on the first business day of January, 2000;
(i) On each Friday commencing November 1, 1996, and ending on May 30,
1997, Lanese will receive a severance check equal to his weekly
base rate of pay as of October 27, 1996, subject to normal
taxation and withholding;
(j) Until December 31, 1996, MDC will continue to perform a security
check on Lanese's personal mail and will continue to reimburse
Lanese for the security system at his home, it being understood
and agreed that the upgrades to Lanese's security system remain
the property of MDC and will be returned to MDC no later than the
date when Lanese sells his home; and
(k) Lanese shall be entitled to receive other employee benefits in
accordance with MDC's established plans, including the Employee
Retirement Income Plan of MDC - Salaried Plan, the Supplemental
Employee Retirement Income Plan, the Employee Savings Plan of MDC
- Salaried Plan and the Supplemental Employee Savings Plan, all
in accordance with the terms of such plans.
3
4. ADDITIONAL CONTRACTUAL TERMS & GENERAL AND SPECIAL RELEASE.
(a) In consideration of the terms and provisions of this Agreement,
Lanese, on behalf of himself and his successors, assigns, attorneys,
representatives, and any and all other related individuals and
entities, does hereby release and discharge MDC and its successors,
assigns, attorneys, affiliated components and corporations, and their
officers, directors, agents and employees from any and all claims,
liabilities, costs and expenses (including, but not limited to,
attorney's fees), damages, actions and causes of action, of whatever
kind or nature arising out of acts or omissions occurring before the
execution of this Agreement (collectively referred to as "claims"),
including, without limitation, any statutory, civil or administrative
claim, claims arising from rights under federal, state, and local laws
prohibiting discrimination on any basis (including age discrimination
and alleged violation of the Age Discrimination in Employment Act),
and common law claims of any kind, including, but not limited to,
contract, tort, and property rights claims including, but not limited
to, breach of contract, breach of the implied covenant of good faith
and fair dealing, tortious interference with contract or current or
prospective economic advantage, fraud, deceit, libel, slander,
misrepresentation, defamation, infliction of emotional distress, and
any other common law claim of any kind. Notwithstanding anything
herein to the contrary, except as provided below in this paragraph 4
herein the Indemnification Agreement dated June 21, 1991, by and
between MDC and Lanese (the "Indemnification Agreement") will survive
this Agreement.
(b) The monies and other considerations outlined in paragraphs 3(a)
through (k) herein, the sufficiencies of which are expressly
acknowledged by Lanese, are accepted by him in complete satisfaction
of all claims, known or unknown, disputed or otherwise.
(c) In consideration of the terms and provisions of this Agreement, MDC,
on behalf of itself and its successors, assigns, attorneys,
representatives and any and all other related individuals and entities
does hereby release and discharge Lanese, and his respective
successors, assigns and attorneys from any and all claims,
liabilities, costs and expenses (including but not limited to
attorneys' fees), damages, actions and causes of action, of whatever
kind or nature occurring before the execution of this Agreement
(collectively referred to as "Claims"), including, without limitation,
common law claims of any kind, including, but not limited to,
contract, tort, or property rights claims including, but not limited
to, breach of contract, breach of the implied covenant of good faith
and fair dealing, tortious interference with contract or current or
prospective economic advantage, fraud, deceit, libel, slander,
misrepresentation, defamation, infliction of emotional distress, and
any other common law claim of any kind. Notwithstanding the foregoing,
4
neither this release and discharge nor the Indemnification Agreement
shall protect Lanese from, and Lanese agrees to indemnify and hold MDC
harmless from and against any and all liability incurred by MDC for
violations of paragraph 5(c) herein or of federal or state employment
discrimination laws by Lanese or by MDC as a result of the conduct or
activities of Lanese while an employee of MDC, or as a result of a
serious violation by him of MDC policy. Amounts payable to Lanese
under paragraphs 3(b), (d), (e), (f), (g), (h) and (i) hereunder may
be reduced and offset by MDC by an amount or amounts deemed reasonably
appropriate by MDC in its sole discretion to satisfy such obligations
of Lanese.
5. CONTINUING OBLIGATIONS.
(a) Acknowledgments by Lanese. Lanese hereby acknowledges the following:
(i) MDC is engaged in, among other things, the business of
researching, designing, developing, manufacturing, selling and
distributing on a worldwide basis fighter and military transport
aircraft, commercial aircraft, helicopters, missiles, satellite
launch vehicles, and certain related and other businesses (the
"Business").
(ii) In connection with the Business, MDC has expended a great deal of
time, money and effort to develop and maintain the secrecy and
confidentiality of substantial proprietary trade secret
information and other confidential business information which, if
misused or disclosed, could be very harmful to the Business and
could cause MDC to lose its competitive edge in the marketplace.
(iii)Lanese desires to become entitled to receive the benefits
contemplated by this Agreement but which MDC would not make
available to him but for his signing and agreeing to abide by the
terms of this Section 5.
(iv) Lanese recognizes and acknowledges that his position with MDC
provided him with access to certain of MDC's confidential and
proprietary trade secret information and other confidential
business information.
(v) MDC compensates its employees to, among other things, develop and
preserve goodwill with its customers on MDC's behalf and business
information for MDC's ownership and use.
(vi) Lanese recognizes and acknowledges that MDC in all fairness would
need certain protection in order to ensure that Lanese does not
appropriate and misuse any confidential information entrusted to
him during the course of his employment with MDC, or take any
other action which could result in a loss of MDC's goodwill that
was generated on MDC's behalf and at its expense, and, more
generally, to prevent Lanese from having an unfair competitive
advantage over MDC.
5
(b) Confidential Information.
(i) Lanese agrees to keep secret and confidential, and not to use or
disclose to any third parties, any of MDC's confidential and
proprietary trade secret information or other confidential
business information concerning the Business acquired by Lanese
during the course of, or in connection with, his employment with
MDC. MDC considers and treats as confidential (among other
things) its engineering, design and technical data, computer
software and programs, component sourcing and supply information,
pricing policies, operational methods, strategic plans, internal
financial information, research and development plans and
activities, and business acquisition and expansion plans, and,
except as provided herein, Lanese agrees to treat such
information as secret and confidential so long as such
information does not become generally known to the public through
no fault or wrongful act of Lanese.
(ii) Lanese acknowledges that any and all notes, records, sketches,
computer diskettes and other documents obtained by or provided to
him, or otherwise made, produced or compiled during the course of
his employment with MDC, which contain any such confidential MDC
information, regardless of the type of medium in which it is
preserved, are the sole and exclusive property of MDC and shall
be surrendered to MDC upon his termination.
(c) Post-Termination Lanese Liabilities. In addition to the continuing
liability of Lanese provided for in paragraph 4(c) herein, Lanese
agrees that, at any time prior to the payment of PAT pursuant to
paragraph 3(b), the vesting or forfeiture of all restricted stock
under the PARS agreements pursuant to paragraphs 3(d), (e) or (f), the
payment for outplacement pursuant to paragraph 3(g) or the payment of
deferred compensation and severance pursuant to paragraphs 3(h) and
(i), Lanese shall forfeit all rights to (1) receiving any PAT pursuant
to paragraph 3(b), (2) vesting or otherwise receiving any restricted
stock under the PARS agreements pursuant to paragraphs 3(d), (e) and
(f), (3) payment for any outplacement services pursuant to paragraph
3(g), and (4) vesting and receipt of deferred compensation and
severance pursuant to paragraphs 3(h) and (i), if he, on his own
behalf or on behalf of any other person, firm, corporation or entity
in the world:
6
(i) provides any services for any of MDC's significant competitors,
representatives, suppliers or customers or provides any general
business, technical or strategic consulting or planning with
respect to the Business for any such companies. Lanese recognizes
that such companies could benefit greatly if they were to obtain
MDC's confidential information. Lanese may request permission to
provide services to or consult with any company that may be
included in the category of MDC's significant competitors,
representatives, suppliers or customers. The written denial or
grant of such a request by MDC's President and Chief Executive
Officer shall be conclusive and binding on the parties hereto.
The grant of such a request will not be unreasonably withheld,
and if the request is granted, Lanese will not be held in
violation of this paragraph 5(c) for providing services to or
consulting with such company in accordance with the terms of the
request;
(ii) knowingly solicits, entices, induces, hires, employs or seeks to
employ any salesperson, engineer, technician, manager or
executive-level employee of MDC, who was employed by MDC on the
date hereof, to provide any services with respect to the
Business; or
(iii) breaches or violates paragraphs 5(b), (d) or (e) or any MDC
policy regarding confidentiality.
(d) Agreement to Refrain from Using Disparaging Comments. Lanese shall
indefinitely refrain, in writing and orally, from using examples or
narrative which are derogatory of MDC, its present or former
management, its policies or practices, or any other matter bearing on
the reputation or good name of MDC.
(e) Agreement re Cooperation. Lanese agrees to readily and fully cooperate
with MDC should it become necessary to develop factual bases to
protect or defend MDC's business interests.
(f) Acknowledgment Regarding Restrictions. Lanese recognizes and agrees
that the provisions of this Section 5 are reasonable and enforceable
because, among other things, (1) he is receiving compensation under
this Agreement and (2) there are many other areas in which, and
companies for which, he could work in view of his background, and this
paragraph 5 therefore does not impose any undue hardship on him. He
further recognizes and agrees that the provisions of this paragraph 5
are reasonable and enforceable in view of MDC's legitimate interests
in protecting its confidential information and customer goodwill and
the limitations contained therein on the duration and geographic scope
of, and activities covered by, such provisions.
6. SUCCESSORS AND ASSIGNS. This Agreement shall inure to the benefit of and
shall be binding upon the successors and assigns of the parties hereto, and
each of them. In the case of MDC, this Agreement is intended to release and
inure to the benefit of MDC's affiliated components and corporations, their
divisions and shareholders, officers, directors, agents, representatives,
employees, and any and all other related individuals and entities, if any,
individually as well as in the capacity indicated.
7
7. INTEGRATION. This Agreement and the Indemnification Agreement (as modified
herein) constitute a single, integrated written contract expressing the
entire agreement of the parties to this Agreement concerning its subject
matters; all other agreements between Lanese and MDC, including, but not
limited to the Termination Benefits Agreement dated March 15, 1996, are
hereby terminated, and to the extent required by such other agreements,
this Agreement shall constitute a terminating amendment to such other
agreements. No covenants, agreements, or warranties of any kind, whether
express or implied in law or fact, have been made by any party to this
Agreement, except as specifically set forth in this Agreement. All prior
and contemporaneous discussions and negotiations have been and are merged
and integrated into, and are superseded by, this Agreement.
8. MODIFICATIONS. No modification, amendment or waiver of any of the
provisions contained in this Agreement, or any future representation,
promise, or condition in connection with the subject matter of this
Agreement, shall be binding upon any party hereto unless made in writing
and signed by such party or by a duly authorized officer or agent of such
party.
9. SEVERABILITY. In the event that any provision of this Agreement should be
held to be void, voidable, unlawful or for any reason unenforceable, the
remaining portions of this Agreement shall remain in full force and effect.
10. NON-ASSIGNMENT OF CLAIMS. Lanese and MDC each represent and warrant that he
and it has not assigned or transferred any portion of the claims released
herein to any other individual, firm, corporation, or other entity, and
that no other individual, firm, corporation or other entity has any lien,
claim or interest in any of such claims, including but not limited to, any
claim or interest arising out of, related to or connected with the matters
referenced herein. Lanese and MDC each covenant and agree not to bring,
induce, or assist, in any claim, action or proceeding of any kind or nature
against the other party, directly or indirectly, regarding, connected with,
arising out of, or relating to in any manner the matters released by this
Agreement and to indemnify the other party from and against all liability
of any kind relating in any way to the activities described in this
paragraph.
11. MISCELLANEOUS TERMS. Each of the parties to this Agreement further
represents, warrants, and agrees as follows:
8
(a) Each of the parties has had the opportunity to review this Agreement
and seek advice on the advisability of making the settlement provided
for herein and executing this Agreement, including the opportunity to
consult with the legal counsel of the party's choice. Lanese
acknowledges that he has been given the opportunity to consider
settling the claims referenced herein, in accordance with the terms of
this Agreement, for twenty-one (21) days, and that he may take as much
of that time as he wants to consider the Agreement before signing it.
Lanese also acknowledges that he may revoke this agreement within
seven (7) days of the date he signs it, and that if he does not revoke
the Agreement within seven (7) days, the Agreement will be effective,
binding and enforceable;
(b) Each of the parties has read the Agreement carefully, knows and
understands the contents thereof, and has made such investigation of
the facts pertaining to the settlement and this Agreement and of all
matters pertaining hereto as it deems necessary or desirable;
(c) The terms of this Agreement are contractual and result from
discussions between the parties;
(d) Each party agrees that such party will not take any action which would
interfere with the performance of this Agreement by any of the parties
hereto or which would adversely affect the status of the rights
provided for, or the claims surrendered, herein; and
(e) In entering into this Agreement and the settlement provided for
herein, the parties, and each of them, acknowledge that this
Agreement, except as expressly provided for herein, is intended to be
final and binding between MDC and Lanese, and, except as expressly
provided for herein, is further intended to be effective as a full and
final accord and satisfaction between them. Each party relies on the
finality of this Agreement as a material factor inducing that party's
execution of this Agreement.
12. SETTLEMENT. The parties hereto acknowledge and covenant that this Agreement
represents a settlement of disputed rights and claims and that by entering
into this Agreement, no party hereto admits or acknowledges the existence
of any liability or wrongdoing, all such liability being expressly denied.
No provision of this Agreement, or of any related document, shall be
construed as an admission or concession of liability, of any wrongdoing or
of any preexisting liability.
9
13. CONFIDENTIALITY. Lanese and MDC agree that the existence, fact, terms, or
provisions of or information concerning this Agreement shall remain
confidential and shall not be disclosed to the mass media or the press, or
to any person, firm, corporation, or other entity (collectively referred to
as "any person") with the sole and exclusive exceptions of: (a) as required
by any governmental agency or court, or otherwise required by law, so long
as the party being compelled to disclose provides the other party with
written notice of such requirement fifteen (15) days prior to the required
disclosure; (b) to Lanese's attorney or accountant as may be required for
the rendition of professional services, so long as any such attorney or
accountant is informed of this confidentiality agreement prior to the
disclosure of information protected by it and agrees to abide by its terms;
(c) to a limited number of MDC employees tasked with implementation of the
terms of the Agreement; (d) to a Court(s) of competent jurisdiction should
either party be required to enforce any provisions hereunder or to sue for
breach; and (e) to Lanese's prospective employers on a very limited basis.
In the unlikely event that Lanese is requested or required to share the
particulars of this Agreement with prospective employers, MDC shall be
notified prior to any proposed disclosure and shall narrowly tailor and
limit the scope of such communications.
14. GOVERNING LAW. This Agreement shall be construed in accordance with the
laws of the State of Missouri.
IN WITNESS WHEREOF, the parties hereto have approved and executed this
Agreement on the date(s) specified below.
/s/ Herbert J. Lanese
--------------------------- October 31, 1996
Herbert J. Lanese
/s/ Harry C. Stonecipher
---------------------------- October 31, 1996
McDonnell Douglas Corporation
By: Harry C. Stonecipher
President & CEO
Dates Referenced Herein and Documents Incorporated by Reference
| Referenced-On Page |
|---|
| This ‘10-K’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| | 1/1/98 | | 2 |
| | 5/30/97 | | 2 |
| Corrected on: | | 5/29/97 |
| Filed on: | | 3/17/97 | | | | | | | DEF 14A |
| For Period End: | | 12/31/96 | | 2 |
| | 11/1/96 | | 2 | | | | | 8-K |
| | 10/31/96 | | 9 | | | | | 8-K |
| | 10/27/96 | | 1 | | 2 |
| | 3/15/96 | | 7 |
| | 2/1/96 | | 2 |
| | 3/20/95 | | 1 | | | | | DEF 14A |
| | 2/16/94 | | 1 |
| List all Filings |
↑Top
Filing Submission 0000063917-97-000005 – Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)
Copyright © 2024 Fran Finnegan & Company LLC – All Rights Reserved.
About — Privacy — Redactions — Help —
Thu., Apr. 25, 9:21:44.1am ET 