EXHIBIT 10.33
January 16, 2007
Mr. Paul M. Isabella
P.O. Box 8967
The Woodlands, Texas 77387
Dear Paul:
I believe we have fully discussed the terms of your departure from Cooper US,
Inc. (“Cooper”). However, I thought it would be beneficial to reduce our
understandings to writing in this Agreement to avoid any misunderstandings at a
later date. Paul, in making these arrangements, we have carefully considered the
services you have rendered and the contributions you have made while working at
Cooper.
Announcements and Transition
On December 1, 2006, you received Cooper’s thirty (30) day written notice (the
“Notice Period”) to you that effective January 2, 2007, your role as Executive
Vice President, Cooper Connection, would end. During the Notice Period, in
addition to your normal responsibilities, you agreed to participate in such
communications with Cooper management and other parties as may be necessary or
helpful to ensure that this management transition would not have any adverse
impact on current and future operations and/or financial results at Cooper.
Effective January 2, 2007, when your active employment terminated, and
throughout the salary continuation period up to and including June 30, 2007,
(the “salary continuation period”) you have agreed to continue to assist us in
an orderly transition of your management responsibilities and to provide
reasonable consulting services to Cooper. Such consulting services will not
exceed an aggregate of 240 hours during the salary continuation period.
Salary and Benefits Continuation
We have mutually agreed that your active employment ceased as of January 2,
2007, but that you will continue to receive your current salary ($35,000.00, on
a monthly basis) through June 30, 2007. These guaranteed payments exceed and are
in lieu of benefits for which you may be eligible under Cooper’s Separation
Allowance Plan and will continue even if you should find alternate employment.
It is understood that no bonuses or vacation will be earned during your salary
continuation period. Your remaining accrued but not taken current year vacation
days will be paid out in a lump sum.
We have also agreed that your salary and benefits continuation period may be
extended for up to six (6) additional months on a month-to-month basis, and in
no event later than through December 31, 2007, in the event you remain
unemployed as of the completion of the six (6) month salary and benefits
continuation period despite a diligent and ongoing job search. (In the event you
will require this extended benefit phase, please advise me by June 15, 2007, to
ensure this occurs). You will not be eligible for the additional salary and
benefits continuation once new employment has been obtained. Such salary and

 

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Personal and Confidential
Mr. Paul M. Isabella
January 16, 2007
Page 2 of 7
benefits continuation will cease effective on the last day immediately
proceeding the date you commence your new employment.
In accordance with Sections IV and VI of the Cooper Industries Amended and
Restated Management Annual Incentive Plan, you acknowledge that you will not be
eligible to receive any portion of the 2006 Management Annual Incentive Award,
which is hereby forfeited in its entirety.
As discussed above, we have also agreed that, if requested, you will be
available to provide reasonable consulting services to facilitate a smooth
management transition during the period from January 2, 2007 to June 30, 2007,
including any extension. These services will be provided at mutually agreeable
times that do not unreasonably interfere with your personal plans. In addition,
at the request of Cooper or any of its related entities you have agreed to
assist us in any threatened or actual litigation concerning it or them, where
you have in your possession or knowledge any facts or other matters which we
reasonably consider is relevant to such legal proceedings (among other things,
giving statements/affidavits, meeting with our legal and other professional
advisers, attending any legal hearing, and giving evidence during your salary
continuation period. We will reimburse you for reasonable expenses properly
incurred by you in giving such assistance. If such assistance is required after
the completion of your salary continuation period, including any extension, we
will pay to you Two Hundred Dollars and No Cents ($200.00) per hour for any time
required.
Group insurance coverage, i.e., life, medical and dental, will continue during
your salary continuation period, including any extension, unless you sooner
receive alternate coverage with another employer even if this alternate coverage
is less comprehensive. You have agreed to notify us if and when such coverage
becomes effective. You will continue to be responsible for the appropriate
employee contributions toward medical and dental insurance in order to be
eligible for coverage. Such contributions will be on the same basis as if you
were an active employee. Other non-contributory welfare benefits (business
travel & accident) will terminate on your last day of active employment.
Voluntary optional life and AD&D coverage may be continued through ongoing
contributions.
You will receive a letter regarding your eligibility for eighteen (18) months of
continuing medical and dental insurance coverage under the federal COBRA law. If
you wish to continue medical and dental coverage after your salary continuation
period you will need to accept the offered coverage within sixty (60) days of
your last day of work. COBRA coverage will run concurrently with the salary
continuation period. Once salary continuation ceases you will need to make
monthly premium payments directly to the insurance carrier in order to maintain
medical and dental coverage.
Outplacement
Cooper will provide you access to outplacement services through Right Management
Consultants at Company expense for up to one year from your termination of
employment.

 

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Personal and Confidential
Mr. Paul M. Isabella
January 16, 2007
Page 3 of 7
Pension
You are covered by the Salaried Employees’ Retirement Plan (the Plan) of Cooper
Industries, Inc. In accordance with the Plan, Company contributions made on your
behalf are 33% vested after three years of service, 67% vested after four years,
and 100% vested after five years of service. Plan provisions also govern the
payment of benefits. Because you have less than three years of service with the
Company, no contributions made on your behalf are vested and, therefore, will be
forfeited.
Savings Plan
You are currently a participant in the Cooper Savings Plan (CO-SAV). You may
check your account balance at any time by contacting Diversified Direct at
1-800-755-5801 or by visiting the Diversified Direct website at
www.divinvest.com.
Employee contributions plus Company matching will continue for separation
allowance payments received for the period up to and including December 31,
2006, or the end of your separation allowance payments, whichever is earlier.
Employee contributions plus Company matching will cease no later than January 1,
2007.
Your CO-SAV account balance may be distributed to you after December 31, 2006,
or at the end of your separation allowance period, whichever is earlier.
Distribution cannot be requested while contributions are being made.
If you elect to leave your account in the plan you will continue to receive
quarterly Participant Statements until your account is distributed. You may
request distribution at any future date before you reach age 701/2 by calling
Diversified or visiting the Diversified Direct website.
Stock Options
According to our records, you currently hold Non-Qualified Stock Option
(NQSO) grants issued in 2005 and 2006. A summary of current vested and
non-vested options issued to you is attached. Non-qualified stock options
granted to you pursuant to an agreement dated February 13, 2006, will terminate
automatically on January 2, 2007, in accordance with Section 1(a) of such
agreement, since you will not be actively employed for one (1) year following
the grant date. 10,000 Non-qualified stock options currently vested at $70.94
and 13,333 non-qualified stock options currently vested at $65.36 awarded on
April 18, 2005, will remain exercisable until ninety (90) days after your active
employment with Cooper ceases, or April 2, 2007, after which date all
outstanding options will automatically terminate and cease to be exercisable.
10,000 non-qualified stock options at $70.94 granted to you pursuant to an
agreement dated April 18, 2005, will continue to vest in accordance with the
terms of such agreement as if you were actively employed on February 7, 2007 and
will remain exercisable until ninety (90) days after your active employment with
Cooper ceases, or April 2, 2007. Other than the vesting described in the
preceding sentence, no additional vesting of stock options shall occur following
your termination of employment.

 

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Personal and Confidential
Mr. Paul M. Isabella
January 16, 2007
Page 4 of 7
Consequently, in the event you elect to exercise any options you must do so
prior to April 2, 2007. In the event you die with stock options outstanding,
rights of your beneficiaries and estate will be as outlined in the applicable
Stock Option Agreement.
Performance Shares
In 2005, you received grants of Performance Shares based on the 2004-2006 and
2005-2007 cycles of the program. These grants are administered under the terms
of the Stock Incentive Plan and the Executive Stock Incentive Agreements between
you and Cooper. (As used herein, all capitalized terms are as defined in the
Stock Incentive Plan and the Executive Stock Incentive Agreement related to each
grant.). Pursuant to the terms of your employment offer, the award under the
2004-2006 cycle of the program will be paid to you, in shares (net of taxes)
once performance results, and awards related thereto, are determined by the MD&C
Committee of the Board of Directors at the February 2007 meeting. Performance
share grants made to you under the 2005-2007 and 2006-2008 cycles of the program
will be forfeited immediately when you cease active service.
Restricted Stock Units
In 2005, you were awarded 28,000 Restricted Stock Units (“RSUs”) which were
subject to restrictions for four (4) years. Restrictions on 7,000 of those RSUs
have lapsed and those shares have been awarded to you. In accordance with the
terms of your Executive Restricted Stock Agreement, the remaining 21,000 RSUs
scheduled to vest ratably on December 1, 2007, December 1, 2008, and December 1,
2009, will be forfeited immediately when you cease active service. However, the
4th quarter dividend equivalent on these unvested shares will be paid to you on
January 2, 2007.
Management Continuity Agreement/Change-In-Control Benefits
In 2006, you entered into a Management Continuity Agreement (“MCA”) with Cooper
that contains provisions that would apply in the event that a corporate
Change-In-Control took place and you were terminated or resigned with “Good
Reason”. This provision is known as a “double trigger” as both events must take
place in order for benefits to become due under the MCA. Effectively
immediately, we have agreed that the MCA will terminate and become null and
void. You also agree that this constitutes sufficient notice as required by the
MCA that you will not be eligible for any payments or benefits under any MCA
with Cooper.
Non-Competition and Non-Solicitation
In your period of employment with Cooper, the nature of your duties were such
that you had access to confidential and proprietary information including, but
not limited to, the following: Company policies, objectives, strategies and
long-range plans, and plans for market and product development that are not now
and will not later become part of the public domain. As a result, we have
requested and you have

 

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Personal and Confidential
Mr. Paul M. Isabella
January 16, 2007
Page 5 of 7
agreed that under no circumstance would you use such information gained in your
position with Cooper to the advantage of any competitor or to the disadvantage
of Cooper. Provisions for confidentiality and non-disclosure, which remain in
effect, include the Executive Employment Agreement dated March 3, 2006, and the
Invention Assignment and Confidentiality Agreement and the Secrecy Agreement
signed by you on April 19, 2005 (the “Agreements”), attached hereto and
incorporated herein by reference. We are also in agreement that you will not
take with you any documents or copies of documents or use in any way, directly
or indirectly, any confidential or proprietary information which you have gained
during your employment with Cooper.
Recognizing the nature and scope of your responsibilities while employed as
Executive Vice President, Cooper Connection, we have agreed that during the
remainder of your employment and for a period of two (2) years following the
termination of your employment, you will not become an employee, officer,
director, agent, contractor or consultant of, or advisor to, EGS/Appleton,
Hubbell Inc., Thomas and Betts Corp., Genlyte-Thomas, Acuity Brands — Lithonia
Lighting, LeGrand, Leviton, Littelfuse, Inc., Ferraz Shawmut subsidiary of
Groupe Carbonne Lorraine, and Hoffman. This paragraph supercedes Section. 10 of
the Executive Employment Agreement dated March 3, 2006, which will otherwise
remain in full force and effect. We acknowledge and agree that this language
constitutes a written amendment as specified in and required by Section. 20 of
the Executive Employment Agreement dated March 3, 2006.
During the remainder of your employment and for a period of two (2) years
following the termination of your employment, you agree that you will not, on
behalf of yourself or any other person, firm, company, business, or other legal
entity, directly or indirectly employ, solicit, influence, or attempt to
influence any management, sales, technical design or engineering employee,
representative or advisor of the Company to terminate his or her employment
relationship with the Company and/or to work in any manner for you, or any
entity affiliated with you. This paragraph supercedes Section. 11 of the
Executive Employment Agreement dated March 3, 2006, which will otherwise remain
in full force and effect. We acknowledge and agree that this language
constitutes a written amendment as specified in and required by Section. 20 of
the Executive Employment Agreement dated March 3, 2006.
During the remainder of your employment and for a period of two (2) years
following the termination of your employment, you agree that you will not, on
behalf of yourself or any other person, firm, company, business or other legal
entity, solicit, contact, call upon, initiate communications with or attempt to
initiate communications with any customer of the Company for the purpose of
selling or providing products similar to or competitive with those manufactured
by the Company. This paragraph supercedes Section. 12 of the Executive
Employment Agreement dated March 3, 2006, which will otherwise remain in full
force and effect. We acknowledge and agree that this language constitutes a
written amendment as specified in and required by Section. 20 of the Executive
Employment Agreement dated March 3, 2006.
Confidentiality
The terms of this letter and the separation-related benefits available to you
from Cooper are highly personal and reflect the contributions you have made to
the Company. As a result, we have asked that you respect the personal nature of
these arrangements by maintaining this information in the strictest confidence.
Consequently, we have agreed that you will reveal the terms of this letter and
the separation benefits provided to you by Cooper only to your spouse, your
personal tax advisor and your attorney, and

 

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Personal and Confidential
Mr. Paul M. Isabella
January 16, 2007
Page 6 of 7
only to the extent these individuals agree to maintain the confidentiality of
these matters. We have also agreed that this information may be disclosed as
required by law but only in proceedings not initiated by you or on your
individual behalf. We have further agreed that the Company may cease further
payments pursuant to this Agreement in the event the separation arrangements
outlined in this letter are disclosed other than as permitted herein or in the
event you do not comply with any obligations imposed on you pursuant to this
Agreement.
Paul, I would appreciate it if you would make certain that any outstanding cash
advances and business expenses be reconciled as soon as reasonably possible. If
not, any amounts due the Company will be withheld from your salary during your
salary continuation period. Any amounts to which you may have been entitled will
be reimbursed through the normal accounting procedures upon submission of
appropriate expense report forms.
If the foregoing clearly and fully reflects our understanding, please so
indicate by signing and returning to me the enclosed Severance Agreement and
Waiver and Release. Although you may take up to twenty-one (21) days to do so,
please return the Waiver as soon as it has been signed. Thereafter, you may
revoke the Waiver of claims under the ADEA in writing within seven (7) days by
providing me with a letter stating your intent to reject the ADEA portion of the
enclosed severance package.
Sincerely,
James P. Williams
Senior Vice President, Human Resources
JPW/sc
Attachments

 

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Personal and Confidential
Mr. Paul M. Isabella
January 16, 2007
Page 7 of 7
I acknowledge receipt of this document and the Waiver And Release.

     
/s/ Paul Isabella
   
 
   
Employee Signature
  Witness
 
   
1/18/07
   
 
   
Date
  Date

 

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Personal and Confidential
WAIVER AND RELEASE
In consideration of the Company’s agreement to provide me with 1) six (6) months
of salary and benefits continuation; 2) to provide conditional salary and
benefits continuation for up to an additional six (6) months on a month-to-month
basis should I remain unemployed despite a diligent and ongoing search that will
cease effective the day immediately proceeding the date my new employment
commences; 3) out-placement; 4) 10,000 non-qualified stock options currently
vested at $70.94 and 13,333 non-qualified stock options currently vested at
$65.36 awarded on April 18, 2005, that will remain exercisable until ninety
(90) days after my active employment with Cooper ceases, or April 2, 2007; and
5) 10,000 non-qualified stock options at $70.94 granted to me pursuant to an
agreement dated April 18, 2005, that will continue to vest in accordance with
the terms of such agreement through February 7, 2007, and that will remain
exercisable until ninety (90) days after my active employment with Cooper
ceases, or April 2, 2007, 50% of which is consideration for release of any and
all claims under the Age Discrimination in Employment Act, as amended (“ADEA”),
which I would not otherwise be eligible to receive, I hereby waive and release
the Company from any and all present employment or termination related claims,
damages, actions, rights, demands, and causes of action, whether known or
unknown, arising from, but not limited to, discrimination on the basis of sex,
race, color, national origin, religion, disability or veteran status; Title VII
of the Civil Rights Act of 1964, as amended, the Civil Rights Act of 1991,
Sections 1981 through 1988 of Title 42 of the United States Code, as amended,
the Employee Retirement Income Security Act of 1974, as amended, the Americans
With Disabilities Act of 1990, as amended, the Workers Adjustment and Retraining
Notification Act, as amended, the Immigration Reform and Control Act, as
amended, the Occupational Safety and Health Act, as amended, the Sarbanes-Oxley
Act of 2002, the Fair Credit Reporting Act, the ADEA, the Older Workers Benefit
Protection Act, as amended, the Texas Commission on Human Rights Act, the Texas
Law on Communicable Diseases, the Texas Equal Pay Act, the Texas Military Leave
and Re-Employment Rights Law, the Texas Wage and Hour Laws, and any other
federal, state, or local civil or human rights law or any other federal, state
or local law, regulation or ordinance. I further waive and release any claims or
demands arising under federal, state or local law, including but not limited to,
common law claims relating to wrongful discharge (including retaliatory
discharge) or any other possible restrictions on the Company’s ability to
terminate its employees at will, including violation of public policy, breach of
any express or implied covenant of the employment contract, and breach of any
covenant of good faith and fair dealing; civil actions relating to negligence,
compensation, defamation, invasion of privacy, fraud, misrepresentation, breach
of contract, denial of leave or other terms and conditions of employment, or
infliction of emotional or mental distress. I further acknowledge that this
Waiver and Release excludes any workers’ compensation claims currently pending
or permitted by law and further excludes any pension or unemployment
compensation benefits to which I may be otherwise entitled, any claims that
controlling state law clearly states that may not be released by settlement, and
any claims that may arise after the date this release is signed.
I have signed this Agreement voluntarily and without coercion or duress. I
acknowledge that I have reviewed all aspects of this Waiver and Release; that I
have carefully read and fully understand all the provisions of this Waiver and
Release; that I understand that in agreeing to this document I am releasing the
Company from any and all claims I may have against them and voluntarily agree to
all the terms set forth in this Waiver and Release; that I knowingly and
willingly intend to be bound by the same; that I was given at least 21 days to
consider the terms of this Waiver and Release; and that I have been advised in
writing to consult with counsel. I knowingly and voluntarily waive the remainder
of the 21-day consideration period, if any, following the date I signed this
Waiver and Release. I have not been asked by the Company to shorten my time
period for consideration of whether to sign this release. The

 

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Personal and Confidential
Company has not threatened to withdraw or alter the benefits due me prior to the
expiration of the 21-day period nor has the Company provided different terms to
me because I have decided to sign the release prior to the expiration of the
21-day period. I agree with the Company that changes, whether material or
immaterial, do not restart the running of the 21-day consideration period. I
further acknowledge that I am voluntarily accepting the Company’s offer of
additional benefits.
I understand that I have a seven-day period after signing this release in which
to revoke in writing any waiver of claims under the ADEA, and that this release
will not be enforceable until the end of the seven-day period. No benefits will
be paid under this release until the eighth day after I sign this release.
I understand that the furnishing of this Waiver and Release and corresponding
consideration shall not be deemed or construed at anytime for any purpose as an
admission by the Company of any liability or unlawful conduct of any kind. Based
upon the signing of this Agreement, I affirm that I have not filed, caused to be
filed, or am presently a party to any claim, complaint, or action against the
Company in any forum or form. I further affirm that I have been paid and/or have
received all leave (paid or unpaid), compensation, wages, bonuses, commissions,
and/or benefits to which I may be entitled and that no other leave (paid or
unpaid), compensation, wages, bonuses, commissions and/or benefits are due to
me, except as provided in this Agreement. I further affirm that I have no known
workplace injuries or occupational diseases and have been provided and/or have
not been denied any leave requested.
I understand and agree to return all confidential information, computer software
or hardware, files, paper, memoranda, correspondence, customer lists, financial
data, credit cards, keys, tape recordings, pictures, and security access cards,
and any other items of any nature which were or are the property of the Company.
I further agree not to retain any copies of any such property in my possession
or under my control.
I agree not to disclose any information regarding the existence or substance of
this Waiver and Release, except to my spouse, tax advisor, and an attorney with
whom I choose to consult regarding consideration of this Waiver and Release.
I agree that the Executive Employment Agreement dated March 3, 2006, is attached
hereto and incorporated herein by reference. I agree that during the remainder
of my employment and for a period of two (2) years following the termination of
my employment, I will not become an employee, officer, director, agent,
contractor or consultant of, or advisor to, EGS/Appleton, Hubbell Inc., Thomas
and Betts Corp., Genlyte-Thomas, Acuity Brands — Lithonia Lighting, LeGrand,
Leviton, Littelfuse, Inc., Ferraz Shawmut subsidiary of Groupe Carbone Lorraine,
and Hoffman. This paragraph supercedes Section. 10 of the Executive Employment
Agreement dated March 3, 2006, which will otherwise remain in full force and
effect. I acknowledge and agree that this language constitutes a written
amendment as specified in and required by Section. 20 of the Executive
Employment Agreement dated March 3, 2006.
I agree that during the remainder of my employment and for a period of two
(2) years following the termination of my employment, that I will not, on behalf
of myself or any other person, firm, company, business, or other legal entity,
directly or indirectly employ, solicit, influence, or attempt to influence any
management, sales, technical design or engineering employee, representative or
advisor of the Company to terminate his or her employment relationship with the
Company and/or to work in any manner for me, or any entity affiliated with me.
This paragraph supercedes Section. 11 of the Executive Employment Agreement
dated March 3, 2006, which will otherwise remain in full force and effect. I
acknowledge

 

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Personal and Confidential
and agree that this language constitutes a written amendment as specified in and
required by Section. 20 of the Executive Employment Agreement dated March 3,
2006.
I agree that during the remainder of my employment and for a period of two
(2) years following the termination of my employment, that I will not, on behalf
of myself or any other person, firm, company, business or other legal entity,
solicit, contact, call upon, initiate communications with or attempt to initiate
communications with any customer of the Company for the purpose of selling or
providing products similar to or competitive with those manufactured by the
Company. This paragraph supercedes Section. 12 of the Executive Employment
Agreement dated March 3, 2006, which will otherwise remain in full force and
effect. I acknowledge and agree that this language constitutes a written
amendment as specified in and required by Section. 20 of the Executive
Employment Agreement dated March 3, 2006.
I agree that the Secrecy Agreement and the Invention Assignment and
Confidentiality Agreement signed by me on April 19, 2006 (the Agreements), and
the accompanying letter to me (the “Letter”) to this Waiver and Release dated
January 16, 2007, are incorporated herein by reference and that I understand
that my obligations under the Agreements remain in full force and effect.
I agree that I shall not for any reason whatsoever and whether directly or
indirectly, either alone or jointly with any person, firm or corporation at any
time, in any way, make disparaging statements about the Company or any of its
related entities, their products, services or employees to any person, entity,
vendor, contractor, subcontractor, competitor, customer or potential customer of
the Company.
I agree that at the request of Cooper or any of its related entities that I
shall assist the Company in any threatened or actual litigation concerning the
Company or any of its related entities, where I have in my possession or
knowledge any facts or other matters which the Company reasonably considers is
relevant to such legal proceedings (among other things, giving
statements/affidavits, meeting with the Company’s legal and other professional
advisers, attending any legal hearing, and giving evidence during my salary
continuation period. I further agree that the Company will reimburse me for
reasonable expenses properly incurred by me in giving such assistance and if
such assistance is required after the completion of my salary continuation
period, the Company will pay to me Two Hundred Dollars and No Cents ($200.00)
per hour for any time required.
I understand that following the seven-day revocation period, this release will
be final and binding.
Should any provision of this Agreement be declared invalid by a Court of
competent jurisdiction, the remaining provisions shall remain in full force and
effect.
The validity of this Waiver and Release shall be construed under Texas law. This
Waiver and Release, the Executive Employment Agreement, the Agreements, and the
Letter constitute the complete and total agreement between the Company and me. I
represent that I am not relying on any other agreements or oral representations
not fully expressed in this Agreement. I agree that this Agreement shall not be
modified, altered, or discharged except by written instrument signed by an
authorized Company representative and me.
As used in this Agreement, the word “Company” shall mean Cooper US, Inc., its
parent, incorporated divisions, wholly-owned subsidiaries, affiliates,
successors and assigns, as well as its agents, employees and officers acting in
their individual and/or official capacity.

 

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I SIGN THIS RELEASE VOLUNTARILY AND AM NOT RELYING ON ANY STATEMENT OR PROMISE
OTHER THAN AS CONTAINED IN THIS RELEASE. I AGREE THAT I HAVE BEEN AND AM ADVISED
IN WRITING TO CONSULT WITH AN ATTORNEY PRIOR TO SIGNING THIS RELEASE:

     
Signed by:
  For the Company:
 
   
/s/ Paul Isabella
  /s/ James P. Williams
 
   
Paul M. Isabella
  James P. Williams
 
   
 
   
Dated: 1/18/07
  Dated: 1/16/07
 
   
Witnessed by: