Exhibit 10.1
SETTLEMENT AGREEMENT AND GENERAL
WAIVER OF ALL RIGHTS AND CLAIMS
     This Settlement Agreement and General Waiver of All Rights and Claims (the
“Agreement”), by and between Tecumseh Products Company (the “Company”) and Edwin
L. Buker (“Buker”), is made effective pursuant to the terms of this Agreement.
     WHEREAS, the Company employed Buker pursuant to an Employment Agreement
dated August 1, 2007 (the “Employment Agreement”) as amended by a First
Amendment to Employment Agreement (the “First Amendment”) and a Letter Agreement
dated November 20, 2008 (the “Letter Agreement”) (collectively, the Employment
Agreement, First Amendment and Letter Agreement will be referenced as the
“Employment Agreements”);
     WHEREAS, Buker’s employment with the Company has terminated;
     WHEREAS, the Company filed a Complaint in the Circuit Court for Lenawee
County related to the Employment Agreements (the “Litigation”) asserting various
claims;
     WHEREAS, the Company and the Buker desire to enter into a written agreement
regarding the termination of Buker’s employment, and to reach a full, final and
complete resolution of the Litigation as it relates to them, without
adjudication of issues of fact or law, and without any admission of any
liability or wrongdoing by any party;
     Now, therefore, for good and valuable consideration, the receipt and
adequacy of which are acknowledged, the undersigned agree as follows:
     1. Termination Payment. The Company shall pay $2,590,000.00 to Buker within
fifteen (15) days of the Effective Date by wire transfer or a check made payable
to “Edwin L. Buker”.
     2. Dismissal of the Litigation. The Company shall cause the Litigation to
be dismissed without prejudice upon full execution of this Agreement, subject to
reinstatement should Buker revoke his acceptance of this Agreement as provided
in Section 8 of this Agreement. If Buker does not revoke this Agreement as
provided for in Section 8 herein, then the Company agrees and covenants that
(a) the Litigation is forever terminated; (b) the Litigation shall not
be-refiled or pursued in any manner by the Company or any of its affiliates; and
(c) that the claims asserted in the Litigation (along with all other claims as
more fully described in paragraph 3(d) herein) are forever released and
discharged. The Company further agrees that, upon this Agreement being fully
executed and unless Buker revokes the Agreement and except as required by the
federal securities laws or other applicable law, neither the Company or anyone
acting on its behalf or at its direction (including all members of its Board of
Directors) will distribute or disseminate the complaint filed in the Litigation
(or any other documents related to the Litigation) to any third party or any
member of the general public.

 

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     3. Releases.
          3(a) For and in consideration of the above, Buker releases the Company
and all present and former directors, officers, members, shareholders, agents,
representatives, attorneys, affiliated and related entities, employees,
successors and assigns of the Company (the “Released Parties”), from any
liability relating to all Claims and Rights as defined in this Section 3 of the
Agreement.
          3(b) Buker further covenants that he will not pursue or allege any
Claims or Rights against the Released Parties in violation of this Agreement.
Buker acknowledges and agrees that he is surrendering and releasing any and all
rights he may have to sue the Released Parties related to, in any way, his
employment with the Company or the termination of such employment. Buker also
acknowledges and agrees that the release of all Claims and Rights is an
essential and material term of this Agreement and that without such release the
Company would not have agreed to the terms of this Agreement.
          3(c) For purposes of this Agreement, the term “Claims and Rights”
means:
               (i) all manners of action and causes of action, charges, claims,
complaints, demands, liabilities, losses, damages, costs or expenses (including
related attorneys’ fees) of any kind whatsoever, known or unknown, suspected or
unsuspected, that Buker may now have or has ever had against any of the Released
Parties by reason of any act, omission, transaction, or event occurring up to
and including the Effective Date, including any manner of action or causes of
action, charges, claims, complaints, demands, liabilities, losses, damages,
costs or expenses relating to the Employment Agreements, Buker’s employment with
the Company or the termination thereof;
               (ii) to the extent permitted by law, Claims and Rights include,
without limitation, any wrongful discharge claim, any claim relating to any
contract of employment, whether express or implied, any claim for or relating to
compensation, any retirement or 401(k) plan administered by the Company or the
management, thereof, any right or benefit under any employee benefit or
compensation plan or arrangement, any claim for defamation, invasion or privacy,
misrepresentation, fraud, infliction of emotional distress, any claim of breach
of covenant of good faith and fair dealing, or any other claim relating in any
way to Buker’s employment relationship with the Company or its termination;
               (iii) any claims based on Title VII of the Civil Rights Act of
1964, the Civil Rights Act of 1991, the Equal Pay Act, the Rehabilitation Act of
1973, the Americans with Disabilities Act, the Vietnam Era Veterans Readjustment
Act, the Fair Labor Standards Act, the Workers Adjustment and Retraining
Notification Act, Executive Order 11246, the Employee Retirement Income Security
Act of 1974 (all of these may have been amended), the Age Discrimination in
Employment Act, the Older Workers Benefit Protection Act, any claims and rights
to any Company payment of group health plan continuation coverage under the
Consolidated Omnibus Budget Reconciliation Act of 1985 and any similar State law
(“COBRA”), including, but not limited to, any right for any Company payment of
any portion of any applicable COBRA premiums, and any other applicable federal,
state, or local laws, ordinances and regulations, including those relating to
discrimination to the extent

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permitted by law. The foregoing shall not discharge the Company’s obligations
under this Agreement or with respect to Buker’s vested 401(k) benefits, if any;
and
               (iv) Claims and Rights also include any rights or claims with
respect to stock appreciation rights, phantom shares, or stock options (whether
or not vested) which are all hereby fully terminated and of no further force and
effect.
          3(d) For and in consideration of the above, the Company releases and
discharges Buker from any liability relating to all manners of action and causes
of action, charges, claims, complaints, demands, liabilities, losses, damages,
costs or expenses (including related attorneys’ fees) of any kind whatsoever,
known or unknown, suspected or unsuspected, that the Company may now have or has
ever had against Buker by reason of any act, omission, transaction, or event
occurring up to and including the Effective Date, including any manner of action
or causes of action, charges, claims, complaints, demands, liabilities, losses,
damages, costs or expenses relating to the Litigation, Buker’s employment with
the Company or the termination thereof.
     4. No Current Claims.
          4(a) Buker. Buker represents that he has not filed any complaints,
claims, or actions against any of the Released Parties with any federal, state
or local court or governmental agency, or any demands for arbitration. Buker
further agrees not to bring, continue or maintain any claim or legal proceeding
against any of the Released Parties before any court, governmental agency or
other forum by reason of any matters hereby released. If any court, governmental
agency or other forum already has or assumes jurisdiction of any complaint,
claim, action or demand for arbitration, against any of the Released Parties,
Buker will immediately direct that court, governmental agency or other forum to
dismiss the matter with prejudice. Buker further agrees that should any
complaints, claims, actions or demands for arbitration be filed hereafter on his
behalf by any federal, state or local agency or by any other person or entity,
that he will immediately withdraw with prejudice, or cause to be withdrawn with
prejudice, or dismiss with prejudice, or cause to be dismissed with prejudice,
any such complaints, claims, actions or demands for arbitration filed against
the Company. Buker agrees not to authorize any other person or entity, including
any governmental agency, to seek individual remedies for him against the Company
through administrative or legal proceedings.
          4(b) Company. The Company acknowledges that, except for the
Litigation, it has not filed any other lawsuit or other action against Buker and
has not commenced any administrative proceeding or complaint against Buker.
Unless this Agreement is revoked, (i) the Company further agrees not to bring,
continue or maintain any claim or legal proceeding against Buker before any
court, governmental agency or other forum by reason of any matters hereby
released; and (ii) the Company further agrees not to authorize any other person
or entity, including any governmental agency, to seek individual remedies for
him against the Company through administrative or legal proceedings. The Company
warrants and covenants that there has been no assignment or transfer of any of
the claims that are being released by way of paragraph 3(d) and that the Company
has the authority to agree to the release contained in paragraph 3(d). The
Company specifically acknowledges that this Agreement and its terms have

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been authorized by its Board of Directors and that the Company has the authority
and ability to enter into this Agreement.
     5. Non-Admission of Liability. The parties acknowledge that this Agreement
is entered into based upon the resolution of disputed claims and that the
parties deny liability on the claims asserted against them. This Agreement shall
not be evidence of any wrongdoing of any nature whatsoever by any of the
parties.
     6. Mutual Nondisparagement. Buker will not disparage the Company, its
officers, directors, and shareholders or its products and services in a
negative, derogatory, or unflattering manner. Under no circumstances may Buker
disclose to any member of the public, including the media, any material,
negative or detrimental information relating to the Company or its products or
services or any information that is otherwise confidential information of the
Company. This provision does not preclude Buker from complying with any lawfully
issued subpoena or court order. The Company (including its Directors and
Officers) agree that they will not collectively or individually disparage Buker
(either personally or in connection with his employment at Company). This
provision does not preclude the Company or its Directors and Officers from
complying with the federal securities laws or other applicable laws or legal
process.
     7. Indemnification Agreement. It is explicitly agreed that nothing in this
Agreement (including the releases contained herein) is intended to or shall
affect any indemnity obligation of the Company to Buker, which shall remain in
full force and effect in accordance with its terms. The Company specifically
agrees that whatever rights of indemnification Buker has or had prior to the
execution of this Agreement shall not be affected or altered in any way by the
terms herein.
     8. Time Period to Accept Agreement. Buker has twenty-one (21) days to
review the terms of this Agreement and has been advised to consult with counsel
of his choice regarding the terms of this Agreement. By executing this
Agreement, Buker acknowledges that he has been advised by his counsel of choice,
he has had adequate opportunity to consult with counsel of choice, and that he
has entered into this Agreement freely and without coercion. Buker may revoke
this Agreement up to seven (7) days after signing it (the “Revocation Period”).
To be effective, the revocation must be in writing and received by the person
who executed this Agreement on the Company’s behalf. If the Agreement is not
revoked within the Revocation Period, it shall be fully enforceable without any
further affirmative action by either party. This Agreement does not become
effective until the Revocation Period has expired (the “Effective Date”).
Between the date of execution of this Agreement and the Effective Date or one
day after Buker revokes this Agreement whichever is earlier, neither party shall
file any lawsuit or any proceeding of any nature relating to the subject matter
of this Agreement.
     9. No Assignment of Claims. Buker represents and warrants that he has:
(a) the sole right, title, and interest to the claims released under this
Agreement, (b) not assigned or transferred, or purported to assign or transfer,
to any person or entity, any claim pursuant to this Agreement, and (c) not
assigned or transferred, nor purported to assign or transfer, to any person or
entity, the right to the monies, in whole or in part, being paid pursuant to
this Agreement.
     10. Resignation. Buker hereby confirms that he has resigned as an officer
and director of the Company’s affiliated entities, and as a director of the
Company.

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     11. Miscellaneous.
          11(a) Severability. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be invalid,
illegal or unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision or any other jurisdiction, but this Agreement will be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision had never been contained in this Agreement.
          11(b) Complete Agreement. This Agreement embodies the complete
agreement and understanding among the parties and supersedes and preempts any
prior understandings, agreements or representations by or among the parties,
written or oral, which may have related to the subject matter of this Agreement
in any way.
          11(c) Counterparts. This Agreement may be executed in separate
counterparts, each of which is deemed to be an original and all of which taken
together constitute one and the same agreement.
          11(d) Successors and Assigns. Except as otherwise provided in this
Agreement, this Agreement shall bind and inure to the benefit of and be
enforceable by Buker and the Company, and their respective successors and
assigns.
          11(d) Amendment and Waiver. The provisions of this Agreement may be
amended and waived only with the prior written consent of the Company and Buker.
          11(e) No Strict Construction. The language used in this Agreement
shall be deemed to be the language chosen by the parties to express their mutual
intent and no rule of strict construction shall be applied against either party
such that neither party shall be deemed to be drafter of this Agreement.
          11(f) Governing Law. This Settlement Agreement shall be governed and
construed in accordance with Michigan law.
          11(g) Headings. The paragraph and section headings in this Agreement
are inserted merely for the convenience of reference only and shall not be used
to construe, affect or modify the terms of any paragraph or provision of this
Agreement.
          11(h) Prevailing Party Recovers its Fees. The parties agree that in
the event of any breach of this Agreement, the prevailing party shall recover
its reasonable and necessary attorney’s fees and costs in connection with any
suit to enforce or defend the enforcement of the terms of this Agreement.
{Signatures on following page}

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     The parties have executed this Settlement Agreement and General Waiver of
All Rights and Claims on the dates noted below.

            TECUMSEH PRODUCTS COMPANY
      By:   /s/ Zachary Savas         Zachary Savas      Its:  Chairman of the
Governance and Nominating
Committee and Lead Director of the Board of Directors
    Date: Oct. 5, 2009         EDWIN L. BUKER
      /s/ Edwin L. Buker       Date: Oct. 5, 2009           

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