{"id":38715,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/contract-termination-agreement-encompass-management-co.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"contract-termination-agreement-encompass-management-co","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/compensation\/contract-termination-agreement-encompass-management-co.html","title":{"rendered":"Contract Termination Agreement &#8211; Encompass Management Co., Encompass Services Corp. and Donald L. Luke"},"content":{"rendered":"<pre>                         CONTRACT TERMINATION AGREEMENT\n\n\n     This Contract Termination Agreement (\"Agreement\") is made and entered into\nby and between DONALD L. LUKE. (the \"Executive\"), ENCOMPASS MANAGEMENT CO.  (the\n\"Company\"), and ENCOMPASS SERVICES CORPORATION (\"Encompass\").\n\n                                   RECITALS:\n\n     The Company has employed the Executive pursuant to the terms of that\ncertain Employment Agreement dated as of August 1, 2000, between the Executive\nand the Company (the \"Employment Agreement\").\n\n     In accordance with the terms of the Employment Agreement, the Executive and\nthe Company agreed to a term of employment extending through May 30, 2001, with\na right on behalf of the Company to terminate the term sooner, in its sole\ndiscretion, provided that, should the Company elect to do so, at the conclusion\nof the Executive's term of employment with the Company, the Company and the\nExecutive would enter into a Contract Termination Agreement pursuant to which\nthe Executive would be entitled to severance compensation in consideration for\nsuch early termination.\n\n     NOW, THEREFORE, in consideration of the payments set forth below, and the\nmutual promises and actions contained herein, it is agreed as follows:\n\n                                 AGREEMENT\n\n     1.  Termination of Employment.  The Company has notified the Executive that\nit has elected to terminate the Executive's employment with the Company\neffective as of September 1, 2000 (the \"Termination Date\").  Notwithstanding the\nforegoing, effective as of August 1, 2000 (the \"Phase Out Date\"), the Executive\nshall relinquish the office of Executive Vice President and Chief Operating\nOfficer of Encompass and shall relinquish all officer positions, titles, and all\nauthorities with respect to the Company and all members of the Company Group (as\ndefined below), other than his position as a director of Encompass, and as a\ndirector of each of the other companies in the Company Group, which positions he\nshall continue to hold, without compensation, until such time as a new director\nis elected in his stead by the respective shareholders of such companies.  From\nand after the Phase Out Date through and including the Termination Date, the\nExecutive shall continue as an employee of the Company as Senior Vice President\n- Operations, at the same salary and benefits as he received prior to the Phase\nOut Date, and shall devote as much time and energy to such position as is\nreasonably required to effectuate a smooth transition of responsibility to the\nnew Chief Operating Officer.  Effective as of the Termination Date, the\nExecutive shall relinquish the office of Senior Vice President - Operations.  As\nused herein, \"Company Group\" means the Company and any entity that directly or\nindirectly controls, is controlled by, or is under common control with the\nCompany, and for purposes of this definition \"control\" means the possession,\ndirectly or indirectly, of the power to \n\n                                       1\n\n \ndirect or cause the direction of the management and policies of such entity,\nwhether through the ownership of voting securities, by contract or otherwise.\nThe Executive shall execute such documents as the Company may reasonably request\nto evidence such resignations.\n\n     Effective on the Termination Date, the parties hereto agree that the\nEmployment Agreement shall terminate (except as provided herein) and the terms\nand provisions of this Agreement shall supersede the Employment Agreement\n(except as provided herein).\n\n     2.  Payments and Benefits.  As consideration for the termination of the\nExecutive's Employment Agreement with the Company, the Executive shall receive\nthe following:\n\n          (a) Base Salary; Bonus.  The Company shall pay the Executive his Base\n     Salary (as defined in the Employment Agreement) through the Termination\n     Date.  The Executive shall be eligible to receive a bonus pursuant to the\n     incentive compensation program in effect from time to time for executive\n     employees of the Company, in accordance with the Employment Agreement,\n     prorated through the Phase Out Date (such prorated portion to be determined\n     based upon the number of working days the Executive is employed by the\n     Company prior to the Phase Out Date, divided by 365 and to be paid on the\n     same date as other executive employees of the Company receive their\n     bonuses).\n\n          (b) Lump Sum Payment.  Subject to the provisions of, and in\n     consideration of the Executive's agreement to comply with the terms of,\n     this Agreement and the provisions of the Employment Agreement that survive,\n     the Executive will receive a lump sum payment totaling $112,500.00 payable\n     on the eighth day following execution of this Agreement.\n\n          (c) Semi-Monthly Payments.  Commencing September 15, 2000, and\n     continuing through May 30, 2001 (the \"Severance Term\"), the Company shall\n     pay the Executive semi-monthly, the sum of $6,250.00. The parties\n     acknowledge that the payment made pursuant to subparagraphs (b) and (c) are\n     consideration for the termination of the Executive's Employment Agreement\n     with the Company and therefore shall not be subject to federal employment\n     and income tax withholding.  The Executive agrees that he shall reimburse\n     the Company for any amount it may be required to pay in respect of such\n     failure to withhold to the extent such amount represents taxes and interest\n     for which the Executive would otherwise be responsible (including his share\n     of FICA taxes), or penalty to the Company.\n\n          (d) Payment of COBRA Premium.  From the Termination Date until the\n     COBRA Benefit Termination Date, subject to the Executive's election to\n     maintain coverage under COBRA, the Company shall pay the monthly premium\n     attributable to the Executive to maintain all health benefits, including,\n     but not limited to, medical insurance, dental insurance, and vision\n     benefits, at a level of coverage and benefits substantially identical to\n     those provided by the Company to an executive in a comparable position with\n     the Company.  Any or all of such benefits may be modified or amended from\n     time to time by the Company, except such modifications shall only be\n     applicable to the Executive if they are applied to other senior Company\n     executives.  The Executive shall be responsible for the payment of any\n     applicable income taxes attributable to such payments.  The \n\n                                       2\n\n \n     parties acknowledge that the payments made pursuant to this subparagraph\n     (d) are consideration for the termination of the Executive's Employment\n     Agreement with the Company and therefore shall not be subject to federal\n     employment and income tax withholding. The Executive agrees that he shall\n     reimburse the Company for any amount it may be required to pay in respect\n     of its failure to withhold to the extent such amount represents taxes and\n     interest for which the Executive would otherwise be responsible (including\n     his share of FICA taxes), or penalty to the Company. After the COBRA\n     Benefit Termination Date, the Executive may elect to continue his COBRA\n     coverage, at the Executive's expense, as permitted by applicable law. The\n     \"COBRA Benefit Termination Date\" means the earlier of (1) such time as the\n     Executive becomes employed either directly or indirectly by any business\n     entity on a full-time basis and becomes eligible for comparable benefits\n     (taken as a whole) at no cost to the Executive provided by such entity and\n     (2) February 28, 2002.\n\n          (e) 401(k) Benefits.  The Executive's right to future contributions to\n     the Company's 401(k) Plan shall terminate as of the Termination Date.  The\n     Executive's participation with regard to past contributions to the\n     Company's 401(k) Plan will continue in accordance with the terms and\n     conditions of that plan.\n\nAll payments made under this Agreement (including those provided in Paragraph\n2(d) above) are inclusive of any and all severance or other termination payments\nor benefits under any plan, program or policy of the Company, including, without\nlimitation, the Employment Agreement.\n\n     3.   Life and Disability Insurance.  The Company shall use reasonable\nefforts to provide  life insurance to the Executive's designated beneficiary in\nan amount equal to at least $900,000, commencing on the Termination Date through\nMay 30, 2001.\n\n     4.  Cooperation.  During the Restricted Period (as defined below), the\nExecutive shall reasonably cooperate with the Company, its financial and legal\nadvisors and\/or government officials, in any claims, investigations,\nadministrative proceedings, lawsuits, and other legal or business matters, as\nreasonably requested by the Company.  To the extent the Executive incurs travel\nor other expenses with respect to such activities, the Company shall reimburse\nhim for such reasonable expenses documented and approved in accordance with\nCompany policy together with such per diem as may be agreed upon by the parties.\n\n     5.  Release by the Executive.  In consideration of the benefits and\npayments provided and to be provided by the Company herein, and as a material\ninducement to the Company to enter into this Agreement, the Executive hereby\nreleases, acquits and forever discharges the Company, its owners, stockholders,\npredecessors, successors, assigns, agents, directors, officers, employees,\nrepresentatives, attorneys, divisions, subsidiaries, affiliates, and all persons\nacting by, through, under or in concert with any of them, from any and all\ncharges, complaints, claims, controversies, demands, rights, disputes and causes\nof action of any nature whatsoever, known or unknown, asserted or unasserted,\naccrued or not accrued, arising prior to or existing at the time of the\nexecution of this Agreement, which the Executive may have or claim to have\nagainst any of the persons or entities released regarding any matter.   This\nrelease includes, but is not limited to, any claim or cause of action for\ndiscrimination under Title VII of the Civil Rights Act of \n\n                                       3\n\n \n1964, the employment laws of any state or municipality, the Employee Retirement\nIncome Security Act of 1974, the Family and Medical Leave Act, the Age\nDiscrimination in Employment Act, and the Americans With Disabilities Act. This\nrelease also includes any other statutory or common law cause of action\nproviding rights for employees against their employers. The Executive further\ncovenants not to sue the Company or file any claim or charge with any agency\ncomplaining of the Company's action with respect to any matter.\n\n     6.  Release by the Company.  In consideration of the covenants of the\nExecutive contained herein, and as a material inducement to the Executive to\nenter into this Agreement, the Company hereby releases, acquits and forever\ndischarges the Executive and his heirs, administrators, executors, and legal\nrepresentatives and all persons acting by, through, under or in concert with any\nof them, from any and all charges, complaints, claims, controversies, demands,\nrights, disputes and causes of action of any nature whatsoever, known or\nunknown, asserted or unasserted, accrued or not accrued, arising prior to or\nexisting as of the Termination Date, which the Company may have or claim to have\nagainst any of the persons or entities released regarding any matter that arises\nout of the Executive's employment with the Company.    The Company further\ncovenants not to sue the Executive or file any claim or charge with any agency\nwith respect to the Executive's employment with the Company.\n\n     7.  Tax Payments, Withholdings and Reporting.  The Executive recognizes\nthat the payments and benefits provided under this Agreement including without\nlimitation those provided pursuant to Section 2 may result in taxable income to\nhim which the Company Group will report to the appropriate taxing authorities.\nThe Company Group shall have the right to deduct from any payment made under\nthis Agreement to the Executive, any business entity controlled by him or any\nother person or entity, any federal, state, local or foreign income, employment\nor other taxes it determines are required by law to be withheld with respect to\nsuch payments or benefits provided thereunder or to require payment from the\nExecutive, which he agrees to pay upon demand, for the purpose of satisfying any\nsuch withholding requirement.  In the event the Company fails to withhold any\nrequired amounts, the Executive agrees that he shall reimburse the Company for\nany amount it may be required to pay in respect of its failure to withhold to\nthe extent such amount represents taxes and interest for which the Executive\nwould otherwise be responsible (including his share of FICA taxes), or penalty\nto the Company.\n\n     8.  Non-Compliance.  All foregoing payments and benefits, provided\nhereunder pursuant to Section 2, are conditioned upon the Executive's compliance\nwith the provisions of Sections 4 and 10 hereof and Sections 10 and 11 of the\nEmployment Agreement.  Each of the aforementioned provisions are material terms\nof this Agreement, and in the event of any violation of any such provisions of\nthis Agreement by the Executive or anyone acting at Executive's direction, or in\nthe event the Executive or anyone acting at his direction shall, following the\nTermination Date, substantially denigrate any of the persons or entities\nreleased under Section 5 above, including without limitation by way of the\nexpression to news media of personal views, opinions or judgments, the Company\nshall be entitled to withhold and terminate all aforementioned payments and\nbenefits provided or to be provided in Section 2, without waiving the right to\npursue any other available legal or equitable remedies.  The provisions of this\nSection 8 shall be not applicable to any truthful statement required to be made\nby the Executive in any legal proceeding or government or regulatory\ninvestigation.\n\n                                       4\n\n \n     9.  No Admission.  This Agreement shall not in any way be construed as an\nadmission by the Company of any act of discrimination or other unlawful act\nwhatsoever against the Executive or any other person, and the Company\nspecifically disclaims any liability to or discrimination against the Executive\nor any other person on the part of itself, its employees or its agents.\n\n     10.  Confidentiality.  The Executive and the Company agree that the terms\nof the Agreement shall be confidential.  The Executive shall not disclose or\ncause to be disclosed the terms of this Agreement except (a) to employees of the\nCompany to the limited extent necessary to perform the terms of this Agreement,\n(b) as may be necessary (i) in filing tax returns or SEC filings, (ii) in\nconnection with enforcing the terms and conditions of this Agreement in a court\nof law as provided herein, (iii) in response to a valid subpoena or other lawful\nprocess, or (iv) except as otherwise required by applicable law and (c) to the\nExecutive's or the Company's respective counsel and accountants.  In the event\nthat either party breaches this non-disclosure, the other party will be entitled\nto injunctive relief to obtain specific performance of this provision and will\nbe entitled to recover its costs and attorneys' fees.\n\n     11.  Miscellaneous Provisions.\n\n          (a) No Assignment.  The Executive represents that he has not\n     transferred or assigned, or purported to assign or transfer, to any person\n     or entity any claim involving the Company or any portion thereof or\n     interest therein.  Any assignment in violation of the foregoing shall be\n     null and void.  Subject to the foregoing, this Agreement shall extend to,\n     be binding upon, and inure to the benefit of the parties hereto and their\n     heirs, representatives, successors and assigns.\n\n          (b) Severance.  If any provision of this Agreement is or may be held\n     by a court of competent jurisdiction to be invalid, void or unenforceable\n     to any extent, the validity of the remaining parts, terms or provisions of\n     this Agreement shall not be affected thereby, and such illegal or invalid\n     part, term or provision shall be deemed not to be part of this Agreement.\n     The remaining provisions shall nevertheless survive and continue in full\n     force and effect without being invalidated in any way.\n\n          (c) Entire Agreement; Amendments and Waivers.  This Agreement\n     constitutes the entire agreement between the parties hereto pertaining to\n     the subject matter hereof and supersedes all prior agreements,\n     understandings, negotiations and discussions, whether oral or written, of\n     the parties, and there are no warranties, representations or other\n     agreements between the parties in connection with the subject matter hereof\n     except as set forth specifically herein or contemplated hereby.  No\n     supplement, modification or waiver of this Agreement shall be binding\n     unless executed in writing by the party to be bound thereby.  The failure\n     of a party to exercise any right or remedy shall not be deemed or\n     constitute a waiver of such right or remedy in the future.  No waiver of\n     any of the provisions of this Agreement shall be deemed or shall constitute\n     a waiver of any other provision hereof (regardless of whether similar), nor\n     shall any such waiver constitute a continuing waiver unless otherwise\n     expressly provided.\n\n                                       5\n\n \n          (d) Governing Law.  This Agreement shall in all respects be\n     interpreted, enforced and governed under the laws of the State of Texas,\n     and shall in all cases be construed as a whole (according to its fair\n     meaning, and not strictly for or against any of the parties).\n\n          (e) Counterparts.  This Agreement may be executed in counterparts,\n     each of which shall be construed as an original for all purposes, but all\n     of which taken together shall constitute one and the same Agreement.\n\n     12.  Continuing Obligations.   The covenants and agreements of the Company\nset forth in Sections 6, 8 and 13 of the Employment Agreement and the covenants\nand agreements of the Executive set forth in Sections 10 and 11 of the\nEmployment Agreement shall survive the execution of this Agreement and are\nhereby incorporated by reference and made a part hereof.\n\n     13.  Trade Secrets, Confidential Information, Non-Compete.  The Company and\nthe Executive acknowledge and agree that, during the term of his association\nwith the Company, the Executive has had access to certain confidential\ninformation relating to the business of the Company and affiliated entities (the\n\"Confidential Information\").  To ensure the continued secrecy of the\nConfidential Information, the Executive agrees that he will not, during the\nRestricted Period, or at any time thereafter, divulge, furnish or make\naccessible to anyone, any knowledge or information with respect to any of the\nConfidential Information relating to the business of the Company other than (a)\npursuant to statutory and legal requirements, (b) pursuant to mandatory court\norder, subpoena or other legal process, or (c) with the consent of or pursuant\nto instructions from the Company.  The Executive also agrees that, during the\nRestrictive Period and for a period of two (2) years thereafter, the Executive\nwill not engage in or carry on, directly or indirectly, either for himself or as\na member of a partnership or as a shareholder, investor, owner, officer or\ndirector of a company or other entity, or as an employee, agent, associate or\nconsultant of any person, partnership, corporation or other entity, any business\nin any State of the United States that directly competes with any services or\nproducts produced, sold, conducted, developed, or in the process of development\nby the Company or its Affiliates at the end of the Restrictive Period.\nNotwithstanding the foregoing, the ownership of less than one percent of any\nclass of securities of a publicly-held company whose gross assets exceed\n$100,000,000 shall not be deemed to constitute a prohibited activity under this\nSection 13.  The Executive acknowledges that the limitations set forth herein on\nthe Executive's rights to compete with the Company and its Affiliates are\nreasonable and necessary for the protection of the Company and its Affiliates.\nIn this regard, the Executive specifically agrees that the limitations as to\nperiod of time and geographic area, as well as all other restrictions on the\nExecutive's activities specified herein, are reasonable and necessary for the\nprotection of the Company and its Affiliates.  In particular, the Executive\nacknowledges that the parties anticipate that the Executive will be actively\nseeking markets for the products and services of the Company and its Affiliates\nthroughout the United States during the term of the Executive's employment by\nthe Company.  In the event that there shall be any violation of the covenant not\nto compete set forth in this Section, then the time limitation thereof shall be\nextended for a period of time equal to the period of time during which such\nviolation continues; and in the event the Company is required to seek relief\nfrom such violation in any court, board of arbitration or other tribunal, then\nthe covenant shall be extended \n\n                                       6\n\n \nfor a period of time equal to the pendency of such proceedings, including all\nappeals. The Executive agrees that the remedy at law for any breach by the\nExecutive of this Section 13 will be inadequate and that the Company shall also\nbe entitled to injunctive relief.\n\n     14.  Separate Counsel.  The Executive is advised by the Company that before\nhe signs this Agreement he should consult with an attorney, and the Executive\nacknowledges that he has had the opportunity to consult with counsel of his\nchoice.  The parties represent and warrant that they have satisfied themselves\nthat they fully understand the terms of this Agreement and knowingly and\nvoluntarily enter into this Agreement.\n\n     15.  21 Days to Sign; 7-Day Revocation Period.  The Executive understands\nthat he may take up to 21 calendar days from the date of the Agreement to\nconsider this Agreement before signing it. Fully understanding the Executive's\nrights to take 21 days to consider signing this Agreement, and after having\nsufficient time to consider the Executive's options, the Executive hereby waives\nhis right to take the full 21 day period.  The Executive further understands\nthat he may revoke this Agreement at any time during the seven days after\nsigning it, and that this Agreement shall not become effective until the seven\nday revocation period has passed.\n\n     16.  Encompass Services Corporation Performance Guarantee. Encompass\nServices Corporation, the parent of the Company, guarantees the timely\nperformance of all covenants and financial obligations of the Company hereunder.\n\n     SIGNED this 1st day of August, 2000.\n\n\n                                    \/S\/ D. L. LUKE\n                                    --------------\n                                    Donald L. Luke\n\n\n\n                                    ENCOMPASS MANAGEMENT CO.\n\n                                    By: \/S\/ GRAY H. MUZZY\n                                        ------------------------\n                                    Name: Gray H. Muzzy\n                                         -----------------------\n                                    Title: Senior Vice President\n                                          ----------------------\n\n                                       7\n\n \n     IN WITNESS WHEREOF, Encompass Services Corporation has executed this\nAgreement on the date first above written solely for the purpose of guaranteeing\nthe performance by the Company of its obligations hereunder, as provided in\nSection 16 of this Agreement.\n\nENCOMPASS SERVICES CORPORATION\n\nBy:\/S\/ DARREN B. MILLER\n   -------------------------\nName: Darren B. Miller\n      ----------------------\nTitle: Senior Vice President\n       ---------------------\n\n                                       8\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[7445],"corporate_contracts_industries":[9481],"corporate_contracts_types":[9539,9544],"class_list":["post-38715","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-encompass-services-corp","corporate_contracts_industries-construction__specialty","corporate_contracts_types-compensation","corporate_contracts_types-compensation__employment"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/38715","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=38715"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=38715"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=38715"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=38715"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}