Document:

Exhibit 10.01

 

FEDERAL HOME LOAN BANK OF NEW YORK 2013 INCENTIVE COMPENSATION PLAN

 

I.             OBJECTIVE

 

The objective of the Federal Home Loan Bank of New York’s (“Bank”) 2013 Incentive Compensation Plan (“Plan”) is to motivate employees to take actions that support the Bank’s strategies and lead to the attainment of the Bank’s business plan and fulfillment of its mission.

 

The Plan is intended to accomplish this objective by:

 

·      Linking annual cash pay-out award opportunities to Bank performance measured by the Bank’s “Business Effectiveness”; “Community Investment Effectiveness” ; and, “Growth Effectiveness” goals as well as utilizing individual, department and group performance measures for certain employees where appropriate and applicable;

 

·      Establishing the goal-setting process as an effective reward system so that employee monetary interests are related to and dependent upon Bank performance; and

 

·      Retaining top performing employees by affording them the opportunity to share in the Bank’s enhanced performance.

 

II.          DEFINITIONS

 

A.    Bank: The Federal Home Loan Bank of New York, its successors and assigns.

 

B.    Board: The Board of Directors of the Federal Home Loan Bank of New York.

 

C.    Committee: The Compensation and Human Resources Committee of the Board.

 

D.    Fiscal Year: The 12-month period used as the annual accounting period by the Bank.

 

E.    Manager: The person to whom the Participant reports directly.

 

F.     Participant: An employee of the Bank as defined by the terms of the Financial Institutions Retirement Fund who is exempt from the application of the overtime provisions of the Fair Labor Standards Act and who is also selected by the President to participate in the Plan.

 

G.    Plan: This Incentive Compensation Plan, as may be amended or supplemented from time to time.

 

H.    Plan Year: 2013

 

I.     President: The Chief Executive Officer of the Bank, regardless of title, or his designee.

 

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II.            ADMINISTRATION

 

A.    The Plan shall become effective upon fulfillment of the conditions included in the resolution pertaining to the Plan adopted by the Committee on March 20, 2013. Once such conditions are fulfilled, the terms of the Plan shall become effective for the Plan Year beginning January 1, 2013.

 

B.    The Plan shall be administered by the President, subject to any requirements for review and approval by the Committee that the Committee may establish. The Committee shall keep the Board apprised of any amendments to the Plan. The Director of Human Resources shall be the President’s designee until there is a written communication by the President naming other(s) to fulfill that duty. In all areas not specifically reserved by the Committee for its review and approval, decisions of the President or his designee concerning the Plan shall be binding on the Bank and on all Participants.

 

C.    While the President has the full power and authority to interpret and administer the Plan, he will also have the following specific rights and duties:

 

1.     To adopt, amend and rescind administrative guidelines, rules and regulations pertaining to the Plan.

 

2.     To accept, modify or reject recommendations of the Managers to set final awards.

 

3.     To interpret and rule on any questions pertaining to any provisions of the Plan.

 

4.     To retain all such other powers as may be necessary to discharge the duties and responsibilities herein. Notwithstanding the foregoing, matters specifically affecting the President shall be handled by the Committee.

 

D.    The President will be responsible for ensuring effective communication of Plan provisions each year. Each Participant will be given a copy of the Plan document and of any schedule deemed necessary by the President. Material modifications or changes to the Plan will be documented and distributed to Participants as soon as practicable.

 

E.    Nothing contained in this Plan shall be construed as a contract of employment between the Bank and a Participant, or as a right of a Participant to be continued in the employment of the Bank, or as a limitation of the right of the Bank to discharge a Participant with or without cause.

 

IV.          ELIGIBILITY

 

A.    Employees in positions determined to have a measurable impact on Bank results and for whom incentive participation is consistent with competitive practice may be eligible for participation in the Plan.

 

B.    The President will select annually, for approval by the Committee, those positions which will be eligible for awards granted under the terms of the Plan. Eligibility may vary from year to year.

 

C.    Incentive compensation opportunity by rank and position is listed in Schedule A, incorporated by reference, which may be updated annually or more frequently, as appropriate.

 

D.    New employees deemed eligible for Plan participation will be considered eligible immediately upon date of hire.

 

V.            INDIVIDUAL AWARD OPPORTUNITIES

 

A.    The President shall recommend to the Committee for its approval the award levels which shall be used to calculate awards earned by Plan Participants.

 

B.    Award levels shall be expressed as a percent of the base salary of each Participant for that Plan Year.

 

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C.    Each position shall have an assigned threshold, target and maximum award opportunity level. The range of award opportunities for each Plan Participant is included in Schedule A, which is incorporated by reference. This Schedule A may be amended or otherwise modified from year to year by the Committee.

 

VI.          OBJECTIVE SETTING

 

The President shall from time to time recommend to the Committee Bankwide performance goals that incentive payments to Participants shall be based upon, either in their entirety or selectively. Individual and/or group performance measures and goals may be developed by Participants in collaboration with their Managers. The Bankwide performance goals will specify target performance levels as well as the achievement levels required to receive threshold and maximum incentive award amounts. Target performance goal(s) reflect achievement of the Bank’s budgeted performance. Maximum performance goal(s) shall be established as goal(s) representing a “reach” for the Bank and/or the group or individual as applicable. The Committee shall review and have final approval over the Bankwide performance measures and goals for all Participants, including the President. Individual and/or group performance measures and goals for Participants other than the President will be reviewed and approved by the participant’s and/or group’s manager. Changing the measures of Bankwide performance or changing the achievement levels of Bankwide performance will require approval of the Committee.

 

VII.         OBJECTIVE WEIGHTING

 

Actual incentive awards under the Plan will be based on (i) Bankwide performance results, and (ii) individual and/or group performance results, if applicable or appropriate. The relative weighting of Bank performance may vary for any group of Participants or individual Participant.

 

VIII.       PERFORMANCE MEASUREMENT

 

A.    Performance against goals will be measured as soon as practicable following the close of the Plan Year.

 

B.    Group and/or individual performance, where applicable, will be measured by each Participant’s Manager.

 

IX.        AWARD DETERMINATION

 

A.    Aggregate performance of Bankwide goals, individual and/or group goals, where applicable, will be used to determine the Participants’ awards. There will be no payout to Participants for Bankwide goals if results on all Bankwide goals fall below the threshold level. Should the Bank not meet all of its Bankwide goals, Participants who have attained at least an overall performance rating of 3.0 will be paid an incentive award based on their individual performance component.

 

B.    A Participant’s overall performance as rated in his/her last performance evaluation must be rated at least a 3.0 in order to receive an incentive payment. However, regardless of his or her overall rating, a Participant with a written performance warning in his or her employment file who does not also have corresponding documentation from his or her manager in his/her employment file evidencing acceptable improvement in the Participant’s performance prior to the payment of the award shall not receive any incentive payment.

 

C.    Participants who are on official leaves of absence, paid or unpaid, and who have an 1) executed 90-day follow-up performance evaluation (for newly- hired Participants) or 2) annual performance evaluation for the Plan Year shall be eligible to receive incentive

 

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awards for the Plan Year, payment of which will be made when the Participant returns from the paid or unpaid leave of absence if that occurs later than the payment of awards to other Participants.

 

D.    Recommendations will be made to the Committee regarding the actual Bankwide performance and the associated level of payments as soon as practicable following the conclusion of the Plan Year. Such recommendations shall be based on achieved levels of performance, measured against the performance objectives adopted for each portion of the award.

 

E.    Plan Participants, including the President, will receive a cash payment of the award as soon as practicable after final approval by the Committee, in accordance with Paragraph N below.

 

F.     Awards earned may vary from the target award defined for each Plan Participant according to performance achieved by the Bank, and where applicable by the group or individual.

 

G.    Payments may vary from the assigned threshold, target and maximum award opportunity level as indicated in Schedule A if the Committee determines at the end of the Plan year that an adjustment to the schedule would better serve the purposes of the Plan.

 

H.    Individuals who are hired during the Plan Year, but in no event after October 31 of that year, to fill eligible positions will receive prorated incentive payments based on length of time worked. To receive such payments, the newly hired employee must have an executed 90-day follow-up performance evaluation and have received at least a “Meets Requirements” rating. The final incentive payment will be calculated on a calendar day basis.

 

I.     If a Participant’s rank or assignment from one tier to another as indicated in Schedule A is changed, the incentive payment may be determined on a pro rata basis according to that portion of the Plan Year worked in each eligible position.

 

J.     If a Participant is promoted and their incentive compensation opportunity, as indicated in Schedule A, does not change, the incentive payment may be determined on a pro rata basis according to that portion of the Plan Year Participant worked in each eligible position.

 

K.    Incentive payments for Participants who are non-officers shall be calculated using the base salary as of the end of the Plan year without regard to prorating.

 

L.    If a Participant other than the President dies, the payment may be awarded based upon the judgment of the Committee. The final payment may be made after approval by the Committee following the conclusion of the Plan Year. If the President dies, the payment may be awarded based upon the judgment of the Board. The final payment may be made after approval by the Board following the conclusion of the Plan Year.

 

M.   If, prior to the payment of an award, (i) the employment of a Participant is terminated by the Bank or (ii) the Participant leaves the Bank voluntarily, no incentive award will be made or payable under this Plan, except in the discretion of the Committee (or in the case of the President, the Board).

 

N.    All incentive awards under this Plan shall be paid to Participants on or before March 14, 2014; provided that, in the event the Bank shall be prevented from calculating and paying such incentive awards by March 14, 2014 by any event, including specifically, but not limited to, (i) its unforeseeable failure to receive any necessary approvals of its financial statements of the Bank for the calendar year 2013 from its regulators or outside accountants in sufficient time in advance of March 14, 2014, (ii) the unforeseeable temporary absence of Bank employees necessary to calculate such incentive awards by such date, or (iii) any other event which the Bank may reasonably deem, in good faith, to constitute administrative impracticability of the Bank to calculate and pay such incentive awards by such date, the failure of the Bank to pay

 

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such incentive awards to Participants by March 14, 2014 shall be deemed to be due to administrative impracticability, within the meaning of § 1.409A-1(b)(4)(ii) of the Regulations under § 409A of the Internal Revenue Code of 1986, as amended (the “Code”), should such provision of the Code be deemed applicable to the Plan notwithstanding the provisions of Section X of this Plan, in which event, or in any other event which may meet the requirements of such provision of such Regulations, the Bank shall pay such incentive awards as soon as the calculation and payment thereof shall be practicable, both administratively and otherwise.

 

O.    Notwithstanding anything to the contrary contained above, payments will be made to certain Participants who are members of the Bank’s Management Committee on a deferred basis in accordance with the provisions of Schedule B attached hereto.

 

X.          BINDING EFFECT AND AMENDMENT AND TERMINATION OF PLAN

 

No Participant shall have any legally binding right, whether by reason of the performance of services or otherwise, to receive any incentive awards or payments under this Plan and nothing in this Plan is intended, nor shall it be deemed, to confer upon any Participant any such legally binding right, the Bank reserving and retaining the right, by its unilateral action at any time and for any reason, to reduce or eliminate any incentive awards or payments and to amend, modify or terminate this Plan. All actions by the Bank pursuant to this Section X shall be made in writing and shall be effective when approved by the Committee or, in the case of actions affecting the President, when approved by the Board.

 

XI.        CLAWBACK PROVISION

 

Any undue incentives paid to a Participant with a rank of Vice President or higher based on the achievement of financial or operational goals within this Plan that subsequently are deemed by the Bank to be inaccurate, misstated or misleading shall be recoverable from such Participant by the Bank. Inaccurate, misstated and/or misleading achievement of financial or operational goals shall include, but not be limited to, overstatements of revenue, income, capital, return measures and/or understatements of credit risk, market risk, operational risk or expenses. The value of any benefits delivered or accrued related to the undue incentive (i.e., the amount of the incentive over and above what should have been paid to the Participant barring inaccurate, misstated and/or misleading achievement of financial or operational goals) shall be reduced and/or recovered by the Bank to the fullest extent possible. Participants shall be responsible for the repayment of any such excess incentive payments as described in this paragraph upon demand by the Bank.

 

XII.       OTHER PROVISIONS

 

The provisions of the Plan shall be governed by the laws of the State of New York.

 

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Schedule A

 

2013 Incentive Compensation Opportunity Table

 

	
Ranking
    	
 
    	
Bank
   Performance/Individual
   Performance
    	
 
    	
Incentive Compensation
   Opportunity
    
	
President
    	
 
    	
90%/10%
    	
 
    	
20% (Threshold)
   40% (Target)
   80% (Maximum)
    
	
Management Committee   Member
    	
 
    	
90%/10%
    	
 
    	
15% (Threshold)
   30% (Target)
   60% (Maximum)
    
	
Key Vice President
    	
 
    	
70%/30%
    	
 
    	
12.5% (Threshold)
   25% (Target)
   50% (Maximum)
    
	
Other Vice President
   &
   Director of Compliance
    	
 
    	
60%/40%
    	
 
    	
10% (Threshold)
   20% (Target)
   40% (Maximum)
    
	
Assistant Vice President
    	
 
    	
40%/60%
    	
 
    	
7.5% (Threshold)
   15% (Target)
   30% (Maximum)
    
	
Sales/Calling Officer   Responsibilities
    	
 
    	
35%/65%
    	
 
    	
15% (Threshold)
   32.5% (Target)
   50% (Maximum)
    
	
Officer
    	
 
    	
40%/60%
    	
 
    	
5% (Threshold) 
   10% (Target)
   20% (Maximum)
    
	
Exempt
    	
 
    	
25%/75%
    	
 
    	
2% (Threshold)
   4% (Target)
   8% (Maximum)
    

 

 

SCHEDULE B TO FEDERAL HOME LOAN BANK OF NEW YORK 2013 INCENTIVE COMPENSATION PLAN

 

DEFERRED INCENTIVE COMPENSATION PLAN PROVISIONS APPLICABLE TO THE MEMBERS OF THE BANK’S MANAGEMENT COMMITTEE

 

Definitions

 

The total amount of the incentive award (if any) under the Plan communicated to Management Committee Participants shall be referred to in this Schedule B as the “Total Communicated Award”.

 

The Total Communicated Award, if any, will be divided such that: 1) 50 percent of the Total Communicated Award shall be referred to as the “Current Communicated Incentive Award” and 2) the remaining 50 percent of the Total Communicated Award shall be referred to as the “Deferred Incentive Award.”

 

Payment Schedule

 

The following illustrates how the Current Communicated Incentive Award and Deferred Incentive Award will be paid:

 

	
Payment
    	
 
    	
Description
    	
 
    	
Payment Year
    
	
Current Communicated Incentive Award
    	
 
    	
50% of the Total Communicated Award
    	
 
    	
2014*
    
	
Deferred Incentive Award installment
    	
 
    	
Up to 33 1/3% of the Deferred Incentive Award
    	
 
    	
2015**
    
	
Deferred Incentive Award installment
    	
 
    	
Up to 33 1/3% of the Deferred Incentive Award
    	
 
    	
2016**
    
	
Deferred Incentive Award installment
    	
 
    	
Up to 33 1/3% of the Deferred Incentive Award
    	
 
    	
2017**
    

 

*Payment shall be made on or before March 14, 2014.

**Payment shall be made within the first two and a half weeks of March in the year indicated.

 

The Current Communicated Incentive Award at maximum shall not exceed 100 percent of the participant’s base salary.

 

Payments of Deferred Incentive Awards In The Event of a Change in Control

 

If prior to the payout of all Deferred Incentive Award payments a Change in Control event occurs (as defined below) then, in such case, the Deferred Incentive Awards shall be inapplicable and all unpaid Deferred Incentive Awards: (i) shall vest 30 days after the Federal Housing Finance Agency (“Finance Agency”) issues its written approval of such a transaction and (ii) shall be paid to the participants 30 days after the closing of the transaction.

 

For purposes of this section, “Change in Control” shall mean a “change in control event” as defined in IRS regulations pertaining to Code Section 409A which involves: (i) the merger,

 

 

reorganization, or consolidation of the Bank with or into another Federal Home Loan Bank or other entity, (ii) the sale or transfer of all or substantially all of the business or assets of the Bank to another Federal Home Loan Bank or other entity, (iii) the purchase by the Bank or transfer to the Bank of all or substantially all of the business or assets of another Federal Home Loan Bank, (iv) a change in the composition of the Board of Directors, as a result of one or a series of related transactions, that causes the number of directors of the Bank elected by members of the Bank located in New Jersey, New York, Puerto Rico and the U.S. Virgin Islands to cease to constitute a majority of the directors of the Bank that are elected by members of the Bank (excluding, for purposes of this clause (iv), non-member independent directors), or (v) the liquidation of the Bank, provided that the term “reorganization” contained in this definition shall not include any reorganization that is mandated by federal statute, rule, regulation, or directive, including 12 U.S.C. Section 1421, et seq., as amended, and 12 U.S.C. Section 4501 et seq., as amended, and which the Director of the Finance Agency (or successor agency) has determined should not be a basis for making payment under this Plan, by reason of the capital condition of the Bank or because of unsafe or unsound acts, practices, or condition ascertained in the course of the Agency’s supervision of the Bank or because any of the conditions identified in 12 U.S.C. Section 4617(a)(3) are met with respect to the Bank (which conditions do not result solely from the mandated reorganization itself, or from action that the Agency has required the Bank to take under 12 U.S. C. Section 1431(d)).

 

Payments of Deferred Incentive Awards in the Event Employment Ends After The Current Communicated Incentive Award Is Paid

 

A.    Retirement or Involuntary Termination of Employment Other Than For Cause

 

Participants who terminate employment due to retirement(1) or involuntary termination(2) (other than for cause(3)) after the Current Communicated Incentive Award payout date but before completion of the payment of all corresponding Deferred Incentive Award installments (as set forth above) shall receive such Deferred Incentive Award installment payments at the same time as such payments are made to Plan participants who are current Bank employees.

 

B.    Resignation from Employment or Involuntary Termination of Employment For Cause

 

(1) “Retirement” for purposes of this Plan is defined as any individual who retires as an Employee in accordance with the rules of the Bank’s Retirement Plan.

 

(2) “Involuntary termination” shall, in all events, result in a “separation from service” as defined in the IRS regulations pertaining to Code Section 409A and (i) exclude termination for cause and (ii) include a resignation for “good reason” as defined in the “safe harbor” contained in such regulations.

 

(3) For purposes of the Plan, “cause” means: (1) continued failure of the Participant to perform his or her duties with the Bank (other than any such failure resulting from disability), after a warning approved by the Director of Human Resources has been delivered to the Participant which specifically identifies the manner in which the Participant has not performed his or her duties; or (2) removal of the Participant by or at the direction of the Federal Housing Finance Agency pursuant to federal laws, rules, and regulations, including 12 U.S.C. §4501 et. seq. as amended or by any successor agency to the Federal Housing Finance Agency pursuant to a similar statute.

 

 

Participants who otherwise resign employment before the completion of the payment of all corresponding Deferred Incentive Award installments shall not receive payment of such installments. Any Participant that is terminated by the Bank for cause (as defined in this Plan) prior to receiving payment of all corresponding Deferred Incentive Award installments shall not receive payment of any remaining unpaid Deferred Incentive Award installments.

 

C. Death or Disability

 

In the case of a Participant whose employment terminates due to death or disability before completion of the payment of all corresponding Deferred Incentive Award installments, such installments shall promptly vest following the death or disability and the remaining installments shall be paid by the Bank within 90 days of the date of death or determination of disability.

 

The “Performance Scorecard” below shall be used for determining the payment of Deferred Incentive Awards:

 

	
 
    	
 
    	
Threshold
    	
 
    	
Target
    	
 
    	
Maximum
    
	
Performance
   Measure
    	
 
    	
75% of Deferred
   Incentive Award
   Installment
    	
 
    	
100% of Deferred
   Incentive Award
   Installment
    	
 
    	
125% of Deferred
   Incentive Award
   Installment
    
	
Market Value of Equity (“MVE”) to Par Value of Capital Stock
    	
 
    	
95%
    	
 
    	
100%
    	
 
    	
105%
    

 

Each Deferred Incentive Award payment may be increased or decreased by 25% based on the Bank’s performance on MVE as outlined in the table above. An employee who terminates employment with the Bank other than for “good reason” or who is terminated by the Bank for “cause” (each as defined in the 2013 Plan ) will forfeit any portion of the Deferred Incentive Award that has not yet been paid upon such termination. In addition, the Deferred Incentive Award will be paid in full in connection with a “change in control” (as defined in the 2013 Plan).

 

The actual results may fall between two benchmark levels. When this happens, the payout figures are interpolated for results that fall between the two applicable ranges; either threshold and target, or target and maximum.

 

Qualifiers

 

The failure to disclose required information, report financial results and/or resolve material regulatory deficiencies in a timely manner as determined by the Board may result in the reduction or elimination of Deferred Incentive Awards; further, the achievement of financial or operational goals within this Plan that subsequently are deemed by the Bank to be inaccurate, misstated or misleading may also result in the reduction or elimination of Deferred Incentive Awards. Inaccurate, misstated and/or misleading achievement of financial or operational goals shall include, but not be limited to, overstatements of revenue, income, capital, return measures and/or understatements of credit risk, market risk, operational risk or expenses. The value of any benefits delivered or accrued related to the undue incentive (i.e., the amount of the incentive over

 

 

and above what should have been paid to the Participant barring inaccurate, misstated and/or misleading achievement of financial or operational goals) shall be reduced and/or recovered by the Bank to the fullest extent possible. Participants shall be responsible for the repayment of any such excess incentive payments as described in this paragraph upon demand by the Bank.Exhibit 10.5

 

SETTLEMENT AND RELEASE AGREEMENT

 

This Settlement and Release Agreement (“Agreement”) is entered into by and between King County, Washington (“King County”) and Supreme Indiana Operations, Inc. (f/k/a Supreme Corporation) (“Supreme”) (individually, a “Party,” and collectively, the “Parties”) as of the 14th day of June 2013 (the “Effective Date”).

 

I.                              RECITALS

 

1.             King County and Supreme entered into a contract for the manufacture and delivery of 35 medium-duty, diesel-fueled public transit buses known as the 1900 Series (the “Buses”).  The Buses were delivered to and accepted by King County between 2009 and 2010.

 

2.             On February 22, 2012, King County filed a lawsuit concerning the Buses against Supreme in King County Superior Court, Case No. 12-2-06711-2 SEA, captioned as King County v. Supreme Corporation, and Supreme counterclaimed (the “Litigation”).  Supreme also asserted third-party claims against Workhorse Custom Chassis, LLC (“Workhorse”), and ProAir, LLC (“ProAir”).

 

3.             King County and Supreme have conducted discovery on the claims, counterclaim, and defenses that they have asserted against each other in the Litigation.

 

4.             By this Agreement, the Parties desire to fully and finally compromise and resolve all claims concerning the Buses that they brought against each other or could have brought against each other in the Litigation.  This Agreement is not intended to address or resolve Supreme’s claims against Workhorse or ProAir.

 

5.             The Parties have fully considered and reviewed the Litigation and the advisability of entering into this Agreement.

 

II.                         AGREEMENT

 

NOW, THEREFORE, in consideration of the promises, covenants, and agreements set forth in this Agreement, the Parties agree as follows:

 

6.             Payment to King County.  Within ninety (90) days of the Effective Date, Supreme will cause $4,737,500.00, by check made payable to “King County”, to be paid and delivered to King County.

 

7.             Storage and Retrieval of the Buses.  By July 9, 2013, Supreme will take possession of and remove the Buses from the facility in King County, Washington, where they are currently being stored.  Supreme also will pay the cost of storing the Buses in this facility from the date of May 10, 2013 until removal, with such costs to be invoiced to Supreme by King County upon removal of the Buses from King County’s possession and paid within thirty (30) days of the date of the invoice.

 

 

8.             Mutual Release of Claims.  Each Party forever releases and discharges the other and its subsidiaries, parents, divisions, affiliates, officers, directors, owners, shareholders, members, managers, associates, predecessors, successors, assigns, agents, partners, employees, insurers, representatives, attorneys, and any and all persons acting by, through, under or in concert with them, of and from any and all manner of action(s) and cause(s) of action, damages, losses, liabilities and demands, in law or in equity, of whatsoever nature or description, whether known or unknown, whether foreseen or unforeseen, which have arisen, may have arisen or which may in the future arise, concerning the Buses and the claims and counterclaims asserted against each other in the Litigation.  This Agreement expressly extends to and includes, but is not limited to, any and all causes of action based on any statute, common law, claim of fraud, or fraudulent inducement and expressly extends to and includes, but is not limited to, each and every claim or cause of action that was asserted or that could have been asserted by either Party against the other for all past and future economic damages, non-economic damages and awards recoverable or potentially recoverable.  In addition, King County agrees to release any and all claims relating to the Buses that it could have brought in the Litigation against Workhorse or ProAir, as well as any non-parties, including but not limited to Emmett Koelsch Coaches, Inc. and Husky Trucks, LLC.  Further, Supreme will have no obligation to provide indemnity against any future claims for medical or health-related issues relating to the Buses.

 

9.             Acknowledgment of Release.  It is the intention of the Parties that the releases contained herein shall be effective to bar each and every claim, demand, or cause of action released hereby.  Each Party recognizes that it may have some claim, demand, or cause of action against the other Party or entities that are released hereby of which they are unaware.  It is the intention of each Party in executing this Agreement that it will deprive itself of each such claim, demand or cause of action and prevent itself from asserting same against the other Party.

 

10.          Dismissal of Claims.  Upon the execution of this Agreement by the Parties, counsel for the Parties shall execute, and counsel for King County shall promptly cause to be filed with the King County Superior Court, a Stipulated Order of Dismissal of King County’s claims against Supreme, including all claims that were brought or could have been brought by King County against Supreme in the Litigation, and of Supreme’s counterclaim against King County, including all claims that were brought or could have been brought by Supreme against King County in the Litigation, in the form attached hereto.

 

11.          Confidentiality.  The terms and conditions of this Agreement are confidential and are intended to remain confidential.  Each Party reserves the right to disclose the existence and/or terms of this Agreement (a) as may be required by law, court order, or rule or (b) to enforce the terms of this Agreement.  Notwithstanding this provision, the Parties may disclose the terms of this Settlement Agreement to their respective attorneys, auditors, regulators, accountants, insurers, and/or any other similar professionals on a need-to-know basis.  The content of this Agreement may be disclosed pursuant to an order by a court of competent jurisdiction or pursuant to a public records disclosure request under either Washington or federal law, or as otherwise expressly required by applicable law (in each case a “Request”).  In the event any Party receives a Request for production or disclosure of information related to this Agreement, that Party shall promptly provide the other Party with written notice of the Request.  A Party may seek court ordered protection from disclosure of any such requested information at that Party’s 

 

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own expense.  If court protection is not obtained, the Party who received the Request shall disclose only that information required by applicable law.

 

12.          Binding Effect.  This Agreement shall be binding upon and shall inure to the benefit of the Parties, their successors-in-interest, and assigns.  All representations and warranties made by the Parties in this Agreement shall survive execution of this Agreement and shall at all times subsequent to execution of this Agreement remain binding and fully enforceable.  The releases in this Agreement do not release the Parties for any of their own acts or omissions going forward on or after the Effective Date.

 

13.          Construction of this Agreement; Venue for Disputes.  This Agreement will be construed as a whole in accordance with its fair meaning and in accordance with the laws of the State of Washington.  This Agreement has been negotiated by counsel for each of the Parties, and the language of this Agreement shall not be construed for or against any particular Party.  Subject to section 17 hereof, the Parties agree that any dispute related to or arising out of this Agreement must be brought in King County Superior Court.

 

14.          Amendment to Agreement.  Any amendment to this Agreement must be in writing signed by duly authorized representatives of the Parties stating the intent of the Parties to amend this Agreement.

 

15.          Review by Counsel.  This Agreement has been carefully reviewed by the Parties and has been reviewed by the Parties’ respective legal counsel; the contents hereof are known and understood by the Parties; and each Party executes this Agreement as its own free and voluntary act.

 

16.          Counterparts.  This Agreement, and any amendment or modification hereto, may be executed by the Parties in any number of counterparts, each of which, once executed and delivered in accordance with the terms of this Agreement, will be deemed an original, and all such counterparts, taken together, shall constitute one and the same instrument.  Delivery by fax or by encrypted e-mail or e-mail file attachment (e.g., in Portable Document Format) of any such executed counterpart to this Agreement, or any amendment or modification hereto, will be deemed the equivalent of the delivery of the original executed Agreement or instrument.

 

17.          Mediation.  In the event of any suit, action, and/or legal proceeding to enforce, interpret, and/or seek damages for breach of this Agreement or any obligation assumed hereunder, the Parties, and any successors-in-interest and assigns, shall, prior to filing a claim in court, mediate (on a non-binding basis) all such issues before Stew Cogan, 1420 Fifth Avenue, Suite 3400, Seattle, Washington 98101.

 

18.          Settlement Negotiations.  Except to enforce the terms of this Agreement, or to respond to any assertions about its effect, no Party shall use the execution of this Agreement or any discussions or negotiations leading to it or its substance or terms against any other Party in any litigation or other legal controversy.  This Agreement, such discussions and negotiations, and all unexecuted drafts of this Agreement and related documents are expressly intended to be subject to the protections afforded by Washington’s Uniform Mediation Act, chapter 7.07 RCW, Washington Rule of Evidence 408, and Federal Rule of Evidence 408.

 

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19.          Compromise / No Admission.  This Agreement is the result of a compromise and neither this Agreement, nor anything contained herein, shall be construed as an admission by either Party: (a) that it has in any respect violated or abridged any federal, state, local, or foreign law; (b) of any liability, wrongdoing, or responsibility on its part or on the part of its predecessors, successors, assigns, agents, parents, subsidiaries, affiliates, directors, officers, employees, executors, or administrators; or (c) of any obligation that it may owe or may have owed to the other Party.  The Parties expressly deny any such liability, wrongdoing, obligation, and responsibility, and intend solely to resolve their dispute and avoid litigation.  No findings of any kind have been made, and each of the Parties agrees that it does not purport and will not claim to be a prevailing party, to any degree or extent, nor will this Agreement or its terms be admissible in any proceeding other than in accordance with section 11 hereof.

 

20.          Rights and Remedies.  The rights and remedies conferred in this Agreement with respect to breach of or default under its terms and conditions are cumulative and not exclusive of any other rights and remedies, and shall be in addition to every other right, power and remedy herein specifically granted or hereafter existing at law, in equity, or by statute, and all such rights and remedies may be exercised from time to time and as often and in such order as may be expedient.  No delay or omission in the exercise of any such right, power, or remedy or in pursuit of any remedy shall impair any such right, power, or remedy or be construed to be a waiver thereof or of any default or to be an acquiescence therein.

 

21.          Attorneys’ Fees and Costs.  In the event of breach or default under the terms of this Agreement, the Party in breach or default shall pay all costs and expenses, including reasonable attorneys’ fees and legal expenses, incurred by the Party not in breach or default in enforcing, or exercising any remedies under this Agreement.

 

22.          Entire Agreement.  This Agreement, including any attached exhibits, constitutes a single, integrated, written contract expressing the entire understanding and agreement between the Parties, and the terms of the Agreement are contractual and not merely recitals.

 

23.          Headings and Captions.  The headings and captions inserted into this Agreement are for convenience of reference only and in no way define, limit, or otherwise describe the scope or intent of this Agreement, or any provision hereof, or in any way affect the interpretation of this Agreement.

 

24.          Further Assurances.  The Parties hereby agree to perform such acts and to prepare, execute, and file all documents or stipulations reasonably required to satisfy the conditions herein contained, or to give full force and effect to this Agreement.

 

25.          Correspondence.  Any notice or communication required or permitted hereunder shall be sufficiently given if delivered (a) by hand, (b) sent by certified mail, postage prepaid, return receipt requested, (c) sent by overnight delivery service for next day delivery with delivery receipt requested, (d) by fax, or (e) by e-mail:

 

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a.             To King County:

 

Jennifer G. Ritchie

Senior Deputy Prosecuting Attorney

516 Third Avenue, Room W400

Seattle, WA 98104

Fax: 206-296-0191

Email: jennifer.ritchie@kingcounty.gov

 

With a copy to:

David R. Goodnight

Hunter Ferguson

Stoel Rives LLP

600 University Street, Suite 3600

Seattle, WA 98101

Fax: 206-386-7500

Email: drgoodnight@stoel.com

Email: hoferguson@stoel.com

 

b.             To Supreme:

 

Mark Weber

Chief Executive Officer

Supreme Corporation/Supreme Indiana Operations, Inc.

2851 East Kercher Road

P.O. Box 463

Goshen, IN 46528

Fax: 574-642-4729

Email:  mark.weber@supremecorp.com

 

With copy to:

Joe Silvernale

Mack Shultz

Gretchen Paine

Perkins Coie LLP

1201 Third Avenue, Suite 4900

Seattle, WA 98101

Fax: 206-359-9000

Email: jsilvernale@perkinscoie.com

Email: mschultz@perkinscoie.com

Email: gpaine@perkinscoie.com

 

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IN WITNESS WHEREOF, each of the Parties has executed this Agreement as of the Effective Date.

 

King County, Washington

 

 

	
By:
    	
/s/   Christine Oh
    	
 
    
	
 
    	
Christine   Oh
    	
 
    
	
 
    	
Deputy   Risk Manager
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/   Kevin Desmond
    	
 
    
	
 
    	
Kevin   Desmond
    	
 
    
	
 
    	
General   Manager, Department of
    	
 
    
	
 
    	
Transportation,   Metro Transit
    	
 
    

 

 

	
Supreme   Indiana Operations, Inc.
    
	
 
    
	
 
    
	
By:
    	
/s/   Mark Weber
    	
 
    
	
 
    	
Mark   Weber
    	
 
    
	
 
    	
Chief   Executive Officer
    	
 
    

 

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