Exhibit 10.26


 


SEPARATION AGREEMENT


 


AND


 


GENERAL RELEASE OF CLAIMS


 


This Separation Agreement and General Release of
Claims (“Agreement” or “General Release”) is made and entered into by and
between Eric S. Rangen, on behalf of his agents, assigns, heirs, executors,
administrators, attorneys and representatives (“Mr. Rangen”), and Alliant
Techsystems Inc., a Delaware corporation, any related corporations or
affiliates, subsidiaries, predecessors, successors and assigns, present or
former officers, directors, stockholders, board members, agents, employees, and
attorneys, whether in their individual or official capacities, delegates,
benefit plans and plan administrators, and insurers (“Company” or “ATK”).


 


WHEREAS, Mr. Rangen’s employment shall end as provided
in this General Release. In consideration of Mr. Rangen signing and complying
with this General Release, ATK agrees to provide Mr. Rangen with certain
payments and other valuable consideration described below. Further, ATK and Mr.
Rangen desire to resolve and settle any and all potential disputes or claims
related to his employment or termination of employment.


 


WHEREAS, ATK has expended significant time and money
on promotion, advertising, and the development of goodwill and a sound business
reputation through which it has developed a list of customers and spent time
and resources to learn the customers’ needs for ATK’s services and products. This
information is valuable, special and unique assets of ATK’s business, which Mr.
Rangen acknowledges constitutes confidential information.


 


WHEREAS, ATK has expended significant time and money
on technology, research, and development through which it has developed
products, processes, technologies and services that are valuable, special and
unique assets of ATK’s business, which Mr. Rangen acknowledges constitute
confidential information.


 


WHEREAS, the disclosure to or use by third parties of
any of ATK’s confidential or proprietary information, trade secrets, or Mr.
Rangen’s unauthorized use of such information would seriously harm ATK’s
business and cause monetary loss that would be difficult, if not impossible, to
measure.


 


THEREFORE, ATK and Mr. Rangen (the “Parties”) mutually
agree to the following terms and conditions:


 


1.             Termination
of Employment. The Parties agree that Mr. Rangen’s employment with ATK is
terminated effective March 31, 2006.


 


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(a)           Final
Paycheck. ATK will pay Mr. Rangen for all salary earned through the
effective date of the termination of his employment with ATK. ATK will also
pay  for any accrued, but unused
vacation/PTO of Mr. Rangen. Mr. Rangen’s continuing rights, if any, under all
other ATK employee benefits plans will be governed by those plans.


 


(b)           Executive
Incentive Plan. Mr. Rangen will be eligible to receive an Executive
Incentive Plan (EIP) payment for Fiscal-Year 2006. This payment will be based
solely on the actual corporate financial performance achieved, as established
in the beginning of such fiscal year, with no discretionary adjustment made to
it. This amount will be paid in a single lump sum payment in cash (or deferred
if previously elected) at the time all other EIP participants receive payment. 


 


(c)           Deferred
Compensation. Any compensation Mr. Rangen deferred under the Alliant
Techsystems Inc. Nonqualified Deferred Compensation Plan (or predecessor plans)
shall be paid in accordance with his pre-selected distribution options and the
terms of that plan.


 


2.             Severance
Benefits. In exchange for Mr. Rangen’s promises contained herein, ATK will
provide Mr. Rangen with the severance benefits contained in the Executive
Severance Plan and with any additional benefits identified in this Paragraph 2
(together referred to as “Severance Benefits”):


 


(a)           Severance
Pay. ATK will pay Mr. Rangen a single lump-sum severance payment in the
amount of $550,400, which is equal to twelve months of his base salary and one
year annual target cash bonus. This severance payment will be subject to all
applicable withholdings and will be taxable as payroll wages. No 401(k)
deductions will be taken from the payment nor is it pensionable earnings (for
example, it is not “Earnings” or “Recognized Compensation”) for purposes of any
ATK qualified or non-qualified employee benefits plans.


 


(b)           Restricted
Stock. Mr. Rangen does not have any unvested and outstanding shares of
restricted stock.


 


(c)           Performance
Share Incentive Stock. In accordance with Mr. Rangen’s Performance Award
Agreement, dated August 2, 2005, Mr. Rangen understands that he will receive a
prorated number of the performance shares that were granted to him, based on
the amount of active service time during the applicable fiscal year 2005-2007
three-year period (two-thirds). Mr. Rangen further understands that ATK will
make payment of these shares to Mr. Rangen following the completion of the
performance period. ATK currently expects that payment to be in May 2007, and
that the amount of the payment depends on whether and to what extent ATK meets
the objectives set when that performance share grant was made.


 


(d)           Stock
Options. Any unvested (not exercisable) stock options will vest and become
exercisable as of Mr. Rangen’s termination date. In accordance with Mr. Rangen’s
Non-qualified Stock Option Agreements, all stock options that are exercisable
on Mr. Rangen’s termination date remain exercisable until the earlier of
(i) the option’s expiration date under the


 


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applicable
Non-qualified Stock Option Agreement, or (ii) three years from Mr. Rangen’s
termination date.


 


(e)           Additional
Lump Sum. ATK will pay Mr. Rangen a lump-sum payment in the amount of
$15,000.00, less ordinary tax and other applicable withholdings, to offset the
cost of continuing health care coverage.


 


(f)            Financial
Planning. ATK will pay Mr. Rangen $24,000, less ordinary tax and other
applicable withholdings, for continued financial planning services in lieu of
company provided financial planning services.


 


(g)           Outplacement
Services. Mr. Rangen will be entitled to participate in executive level
outplacement services through Lee Hecht Harrison. These services are provided
for a six month period which may start at Mr. Rangen’s election, but will
continue no later than December 31, 2006, whether or not the full six months
have been used.


 


(h)           Independent
Consideration. Mr. Rangen understands and agrees that he is only eligible
for Severance Benefits in the event he signs this General Release, does not
rescind/revoke this General Release, and submits a letter confirming no
rescission/revocation. Mr. Rangen acknowledges that he is not otherwise
entitled to receive such additional and valuable consideration. Except as
otherwise provided in Paragraph 8 and 10, by Mr. Rangen’s signature on this
General Release, he waives all rights he may have to any other benefits or cash
payment, unless such waiver is prohibited by law. Further, Mr. Rangen agrees
that these Severance Benefits are adequate consideration for the promises
herein.


 


(i)            Delivery
of Severance Pay and Cash Benefits. ATK shall deliver to Mr. Rangen the
cash amounts under Paragraphs 2(a), (e), and (f) promptly after October 1,
2006, provided that the applicable rescission period has elapsed. This delivery
date may be delayed further if necessary to comply with Section 409A of the U.S.
Internal Revenue Code of 1986, as amended from time to time but in any event
the delivery date shall not be extended beyond 30 days of the earliest date
permitted by Section 409A.


 


3.             Post Employment
Restrictions.


 


(a)           Confidentiality
and Non-Disparagement. Mr. Rangen acknowledges that in the course of his
employment with ATK, he has had access to confidential information and trade
secrets. Mr. Rangen agrees to maintain the confidentiality of ATK’s
confidential information and trade secrets. He will not disclose or otherwise
make available to any person, company, or other party confidential information
or trade secrets. Further, Mr. Rangen agrees not to make any disparaging or
defamatory comments about any ATK employee, director, or officer, the Company,
or any aspect of his employment or termination from employment with ATK. ATK
and its officers agree not to make any disparaging or defamatory comments about
Mr. Rangen. Nothing in this Section 3(a) shall prevent or restrict ATK or Mr.
Rangen from providing truthful information or testimony in response to a valid
subpoena issued by a court of competent jurisdiction or as otherwise required
by law.


 


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(b)           Competition
Restrictions. From April 1, 2006 through March 31, 2007, Mr. Rangen agrees
he will not directly or indirectly, personally engage in, nor own, manage,
operate, join, control, consult with, participate in the ownership, operation
or control of, or be employed by any of the companies listed on Exhibit A of
this Agreement, unless he has received express written consent by the Chief
Executive Officer of ATK. In such event, ATK may provide to such company
written notice of any confidentiality or non-disclosure agreements Mr. Rangen
has with ATK.


 


(c)         Non-solicitation.
From April 1, 2006 through March 31, 2007, Mr. Rangen will not, directly or
indirectly solicit any of ATK’s employees for the purpose of hiring them or
inducing them to leave their employment with ATK, nor will he provide any
person or entity with information regarding ATK employees for the purpose of
allowing that person or entity to solicit any of ATK’s employees for hire or to
leave their employment with ATK.


 


(d)         Breach
of Post-Employment Restrictions. If Mr. Rangen breaches any provisions of
this General Release, he understands and agrees that ATK may discontinue any
remaining Severance Benefits. He further agrees that if he commits such a
breach, ATK will be entitled to repayment of the value of the Severance Payment
(set forth in Paragraph 2(a) of this General Release) paid to Mr. Rangen and/or
to seek injunctive relief. Notwithstanding the above, if Mr. Rangen breaches
the Post-Employment Restrictions, he agrees to return 75 percent of the
severance payment (set forth in Paragraph 2(a) of this General Release), and he
understands and agrees that ATK will discontinue any remaining Severance
Benefits.


 


4.             Return
of ATK Property. Prior to Mr. Rangen’s last day of employment, he agrees to
return all non-incidental ATK property in his possession or control including,
but not limited to, confidential or proprietary information, credit card,
documents, records, correspondence, identification badge, files, keys,
software, and equipment, except that Mr. Rangen may keep his computer and cell
phone. Further, Mr. Rangen agrees to repay to ATK any amounts that he owes for
personal credit card expenses, wage advances, employee store purchases, and
used, but unaccrued, vacation/PTO time. These debts, if any, may be withheld
from his severance payment.


 


5.             General
Release of Claims By Mr. Rangen. Except as stated in Paragraph 8, Mr.
Rangen hereby releases and forever discharges ATK from all claims and causes of
action, whether he currently has knowledge of such claims and causes of action,
arising, or which may have arisen, out of or in connection with his employment
or termination of employment with ATK. This includes, but is not limited to,
claims, demands or actions arising under any federal or state law such as the
Age Discrimination in Employment Act (“ADEA”), the Older Workers Benefit
Protection Act (“OWBPA”), Title VII of the Civil Rights Act of 1964 (“Title
VII”), the Americans with Disabilities Act (“ADA”), the Family Medical Leave
Act (“FMLA”), the Employee Retirement Income Security Act of 1978 (“ERISA”),
the Worker Adjustment Retraining and Notification Act (“WARN”), the Fair Labor
Standards Act (“FLSA”), the National Labor Relations Act (“NLRA”), the
Occupational Safety and Health Act (“OSHA”), the


 


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Rehabilitation Act, the
Minnesota Human Rights Act, and Minn. Stat. Chap. 181, all as amended.


 


This General Release
includes any state human rights or fair employment practices act, or any other
federal, state or local statute, ordinance, regulation or order regarding
conditions of employment, compensation for employment, termination of
employment, or discrimination or harassment in employment on the basis of age,
gender, race, religion, disability, national origin, sexual orientation, or any
other protected characteristic, and the common law of any state.


 


Mr. Rangen further
understands that this General Release extends to all claims which he may have
as of this date against ATK based upon statutory or common law claims for
breach of contract, breach of employee handbooks or other policies, breach of
promises, fraud, wrongful discharge, defamation, emotional distress,
whistleblower claims, negligence, assault, battery, or any other theory,
whether legal or equitable.


 


Mr. Rangen agrees that
this General Release includes all damages available under any theory of
recovery, including, without limitation, any compensatory damages (including
all forms of back-pay or front-pay), attorneys’ fees, liquidated damages,
punitive damages, treble damages, emotional distress damages, pain and
suffering damages, consequential damages, incidental damages, statutory fines
or penalties, and/or costs or disbursements. Except as stated in Paragraph 8,
Mr. Rangen is completely and fully waiving any rights under the above stated
statutes, regulations, laws, or legal or equitable theories.


 


6.             General
Release of Claims by ATK. Except as stated in Paragraph 8, ATK hereby
releases and forever discharges Mr. Rangen from all claims and causes of
action, whether ATK currently has knowledge of such claims and causes of
action, arising, or which may have arisen, out of or in connection with his
employment or termination of employment with ATK.


 


ATK understands
that this General Release extends to all claims which ATK may have as of this date
against Mr. Rangen based upon statutory or common law claims, whether legal or
equitable.


 


ATK agrees that
this General Release includes all damages available under any theory of
recovery, including, without limitation, any compensatory damages (including
all forms of back-pay or front-pay), attorneys’ fees, liquidated damages,
punitive damages, treble damages, emotional distress damages, pain and
suffering damages, consequential damages, incidental damages, statutory fines
or penalties, and/or costs or disbursements. Except as stated in Paragraph 8,
ATK is completely and fully waiving any rights under the above stated statutes,
regulations, laws, or legal or equitable theories.


 


7.             Breach
of General Release of Claims. If Mr. Rangen breaches any provision of the
General Release of Claims provided in Paragraph 5 except as set forth in
Paragraph 8, then he will not be entitled to, and shall return, 25 percent of
the Severance Pay provided in Paragraph 2(a). ATK will be entitled to attorney’s
fees and costs incurred in its defense including collecting the repayment of
applicable consideration. Such action on the part of ATK will not in


 


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any way affect the
enforceability of the Post-Employment Restrictions provided in Paragraph 3,
which are adequately supported by the remaining Severance Benefits provided in
Paragraph 2.


 


8.             Exclusions
from General Release. Mr. Rangen and ATK are not waiving any right it/he
may have to enforce the terms of this General Release or to challenge the
knowing and voluntary nature of this General Release ; or the right to assert
claims that are based on events that happen after this General Release becomes
effective, or any other right that by law cannot be waived. Mr. Rangen and ATK
agree  that each reserves any and all
defenses and claims, which it/he has or might have  in the event either party brings any claims,
institutes a court or agency action, or institutes any legal proceeding
against, the other party. This includes, but is not limited to, ATK’s right to
seek available costs and attorneys’ fees, and to have any money or other
damages that might be awarded to him, reduced by the amount of money paid to
him pursuant to this General Release. Mr. Rangen and ATK further agree that
nothing in this General Release affects (1) Mr. Rangen’s right to seek
indemnification in the event of a third party action or other circumstance
warranting indemnification in accordance with applicable law and ATK bylaws; or
(2) Mr. Rangen’s right to seek coverage under ATK’s director and officer or
other insurance in accordance with the terms of such insurance. Nothing in this
General Release interferes with Mr. Rangen’s right to file a charge with the
Equal Employment Opportunity Commission (“EEOC”), or to participate in an EEOC
investigation or proceeding. Nevertheless, Mr. Rangen understands that he has
waived his right to recover any individual relief or money damages, which may
be awarded on such a charge.


 


9.             Right
to Revoke. This General Release does not become effective for a period of
fifteen (15) days after Mr. Rangen signs it and he has the right to cancel it
during that time. Any decision to revoke this General Release must be made in
writing and hand-delivered to ATK or, if sent by mail, postmarked within the
fifteen (15) day time period and addressed to Paula Patineau, Sr. V.P. Human
Resources and Administration, Alliant Techsystems Inc., 5050 Lincoln Drive,
Edina, MN 55436. Mr. Rangen understands that if he decides to revoke this
General Release, he will not be entitled to any Severance Benefits.


 


10.           No
Known Claims, Cooperation and Defense. (a) 
Mr. Rangen represents that, as of the date he signs this Agreement, to
the best of his knowledge, he knows of no reason why any civil and/or criminal
administrative claims, charges, proceedings, and/or lawsuits should be filed,
sued and/or initiated against ATK that he has not in good faith communicated to
the appropriate current ATK management and/or legal professional. Mr. Rangen
further represents that, to the best of his knowledge, he knows of no
compliance issues or Sarbanes-Oxley Act reporting issues that concern or relate
to ATK that he has not communicated in good faith to the appropriate current
ATK management, legal professional or the Audit Committee of ATK’s Board of
Directors.


 


(b)  Mr. Rangen agrees to cooperate with ATK as
reasonably requested if questions arise involving ATK’s business in which Mr.
Rangen was involved or about which Mr. Rangen has information for the period in
which Mr. Rangen was employed by ATK. If questions surface requiring Mr. Rangen’s
involvement, ATK and Mr. Rangen will mutually agree upon a time and the
logistics for providing such information that is convenient for the business
and other


 


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schedules of both parties.
Mr. Rangen will cooperate in the provision of information and responding to
questions without any hourly fee, but with reimbursement for reasonable
expenses, to a maximum total of 25 hours in the first year after his separation
from ATK. Mr. Rangen shall be paid an hourly rate of $300 per hour for all time
spent in excess of   a total of 25 hours
in the first year after his separation, and for all hours spent after the first
year of separation, and shall also be reimbursed for reasonable expenses. If
Mr. Rangen’s cooperation is required for purposes of the defense of a legal
action or proceeding in which Mr. Rangen is a party and receiving full
indemnification from ATK under applicable law and/or ATK’s by laws, Mr. Rangen
will be entitled to those indemnification rights and will not receive the
hourly compensation for his time contemplated by this Paragraph 10(b).


 


11.           Unemployment
Compensation Benefits. If Mr. Rangen applies for unemployment compensation,
ATK will not challenge his entitlement to such benefits. Mr. Rangen understands
that ATK does not decide whether he is eligible for unemployment compensation
benefits, or the amount of the benefit.


 


12.           No
Wrongdoing. By entering into this General Release, ATK does not admit that
it has acted wrongfully with respect to Mr. Rangen’s employment or that he has
any rights or claims against ATK.


 


13.           No
Adequate Remedy at Law. Mr. Rangen acknowledges and agrees that his breach
of the Post-Employment Restrictions provided in Paragraph 3 would cause
irreparable harm to Company and the remedy at law would be inadequate. Accordingly,
if Mr. Rangen violates such Paragraph, ATK is entitled to injunctive relief in
addition to any other legal or equitable remedies.


 


14.           Choice
of Law and Venue. The terms of this General Release will be governed by the
laws of Minnesota (without regard to conflict of laws principles). Any legal
action to enforce this General Release shall be brought in a competent court of
law in Hennepin County, Minnesota.


 


15.           Severability.
If any of the terms of this General Release are deemed to be invalid or
unenforceable by a court of law, the validity and enforceability of the
remaining provisions of this General Release will not in any way be affected or
impaired thereby. In the event that any court having jurisdiction of the
parties should determine that any of the post-employment restrictions set forth
in Paragraph 3 of this General Release are overbroad or otherwise invalid in
any respect, Mr. Rangen acknowledges and agrees that the court so holding shall
construe those provisions to cover only that scope, duration or extent of those
activities which may validly and enforceably be restricted, and shall enforce
the restrictions as so construed. The Parties acknowledge uncertainty of the
law in this respect and expressly stipulate that this Agreement shall be
construed in a manner which renders its provisions valid and enforceable to the
maximum extent (not exceeding its express terms) possible under applicable law.


 


16.           No
Assignment. This General Release is personal to Mr. Rangen and he cannot
assign it to any other person or entity.


 


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17.           Attorneys’
Fees. Mr. Rangen understands that he is responsible to pay his own costs
and attorneys’ fees, if any, that he incurred in consulting with an attorney
about this General Release.


 


18.           Entire
Agreement. This General Release constitutes the entire agreement between
ATK and Mr. Rangen regarding the subject matter included in this document. Mr.
Rangen agrees that there are no promises or understandings outside of this
General Release, except with respect to his continuing obligations not to
reveal ATK’s proprietary, confidential, and trade secret information, as well
as his obligations to maintain the confidentiality of secret or top secret
information. This General Release supercedes and replaces all prior or
contemporaneous discussions, negotiations or General Releases, whether written
or oral, except as set forth herein. Any modification or addition to this
General Release must be in writing, signed by an officer of ATK and Mr. Rangen.


 


19.           Eligibility
and Opportunity to Review.


 


(a)           All
employees who are eligible to participate in the Executive Severance Plan must
execute a release of claims in order to receive Severance Benefits.


 


(b)           Mr. Rangen
certifies that he is signing this General Release voluntarily and with full
knowledge of its consequences. Mr. Rangen understands that he has at least
twenty-one (21) days from the date he received this General Release to consider
it, and that he does not have to sign it before the end of the twenty-one (21)
day period. Mr. Rangen has been advised to use this time to consult with an
attorney prior to executing this General Release.


 


(c)           Mr. Rangen understands
that the offer to accept this General Release remains open for twenty-one (21)
days. If he has not signed this General Release within twenty-one (21) days of
receiving it, then this offer expires and ATK will be under no obligation to
accept this General Release or to provide him any Severance Benefits.


 


20.          Understanding
and Acknowledgement. Mr. Rangen acknowledges that he understands all of the
terms of this General Release and has not relied on any oral statements or
explanation by ATK. Mr. Rangen has had adequate time to consult with legal
counsel and to consider whether to sign this General Release, and that he is
signing it knowingly and voluntarily. 


 


IN WITNESS
WHEREOF, the Parties have executed this General Release on the date(s) shown.


 


	
  ALLIANT
  TECHSYSTEMS INC.

  	
  Employee’s
  signature

  
	
   

  	
   

  
	
  /s/ Paula
  Patineau

  	
   

  	
  /s/ Eric S.
  Rangen

  	
   

  
	
  By:

  	
  Paula Patineau

  	
  Eric S. Rangen

  
	
  Its:

  	
  Sr. V.P. Humans
  Resources

  and Administration

  	
   

  
	
   

  	
   

  
	
  Date:

  	
  3/24/06

  	
   

  	
  Date:

  	
  3/24/06

  	
   

  
							



 


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