Document:

Exhibit 10.1

 

 

SEPARATION AGREEMENT

 

This Separation Agreement is entered into by Neil Dial and Power-One, Inc. (“Power-One”).

 

1.                                       Termination of Employment. Mr. Dial’s employment with Power-One will terminate effective June 29, 2012 (the “Separation Date”).

 

2.                                       Final Wages, Vacation Pay. On the Separation Date, Power-One will pay the following to Mr. Dial:

 

(a)                                  All wages or salary earned and unpaid through Friday, June 29, 2012; and

 

(b)                                 Accrued, unused vacation, if any, as of the Separation Date.

 

Mr. Dial will receive the amounts described in (a) and (b) above whether or not Mr. Dial releases any claims he has or may have against Power-One. Payment of these sums will be subject to appropriate deductions and withholdings.

 

3.                                       Separation Payment. On the Separation Date, Mr. Dial will be presented with a release of claims agreement (the “Release of Claims”). On the eighth day following the execution and return of the Release of Claims by Mr. Dial (or on the next business day, if the eighth day is a weekend day or a holiday), and provided that Mr. Dial has not exercised his right to revoke the Release of Claims, Power-One will pay to Mr. Dial the gross sum of $187,500 (representing 26 weeks of base compensation), less appropriate payroll tax deductions and withholdings. In addition, the Company will pay a lump-sum of $15,000 to Mr. Dial, which Mr. Dial may use to purchase outplacement services or similar services at his own discretion. This amount will be paid through Power-One’s regular payroll system

 

4.                                       Benefits. Power-One acknowledges that at his own expense, Mr. Dial is eligible to elect continuation of his current medical, dental and vision benefit coverages under the Consolidated Omnibus Budget Reconciliation Act, as amended (“COBRA”), in accordance with its terms, regardless of whether he enters into a Release of Claims. Mr. Dial’s rights and responsibilities under the benefit plans and programs offered by Power-One to its employees are subject to applicable law and the terms of the plan documents, as they apply to terminated employees. Upon execution and non-revocation of the Release of Claims, the COBRA monthly premiums for Medical, Dental, and Vision will be paid by Power-One for a period of 12 months (July 2012 thru June 2013), or until such time as Mr. Dial is employed by a Company that offers health care benefits, as outlined in separate COBRA rights information provided to Mr. Dial by IGOE. Thereafter, Mr. Dial will be responsible for COBRA monthly premiums if he elects to continue coverage. Mr. Dial is eligible to continue participation in the Executive Medical Reimbursement plan through December 2012, maximum reimbursement allowance not to exceed $10,000USD.

 

Mr. Dial acknowledges that after the Separation Date he is not entitled to participate in any other Power-One benefit plan, including incentive and bonus plans, and he further acknowledges that he will not accrue further benefits under any plan or program, including allowances of any type and accruals of paid time off. After the Separation Date, Mr. Dial will be ineligible to contribute to any Power-One retirement plan, such as the 401K plan.

 

5.                                       Stock Option Exercise Period and Vesting of Stock Options, Restricted Stock Units (RSU) and Performance Stock Units (PSU). RSU’s that vest prior to the Separation Date represent stock owned by Mr. Dial, which he may retain or sell at his discretion. Upon execution and non-revocation of a Release of Claims, Mr. Dial will be granted 6 months (July 2012 through December 2012) to exercise any stock options vested as of his Separation Date, in accordance with the amended and restated 2004 Stock Incentive Plan. Any stock option and RSU awards that have not vested as of Mr. Dial’s Separation Date, and Mr. Dial’s PSU award, will terminate and be forfeited on the Separation Date.

 

1

 

6.                                       Acknowledgement of Consideration. Mr. Dial acknowledges that he is not entitled to the payments set forth in Paragraph 3 above, the payment of his COBRA premiums by Power-One for one year, or the additional three months extension of time to exercise his stock options (collectively the “Separation Benefits”), and that he has been offered the Separation Benefits in return for execution and non-revocation of the Release of Claims. Mr. Dial acknowledges that separate and apart from the Release of Claims, he is entitled only to (i) the monies described in paragraph 2 of this Agreement, and (ii) COBRA coverage in accordance with COBRA, as amended, at his own expense

 

7.                                       Return of Property and Documents. On or before the Separation Date, Mr. Dial will return to Power-One all property, including but not limited to his laptop computer, cell phone, office keys and American Express credit card, and any documents, electronic information and materials of Power-One, including any copies thereof, that are in his possession. On or before the Separation, Mr. Dial shall reconcile and submit for approval any outstanding American Express bills. Mr. Dial agrees to provide any passwords, access codes or other information necessary for Power-One to access files and records created and maintained by him during his term of employment with Power-One. Mr. Dial further agrees that on or before the Separation Date he will prepare a list of the dates, times and places of any scheduled meetings and open projects with Power-One Inc. and its strategic business units, and that he will provide the list, and any relevant detail and information about the meetings and projects to Human Resources.

 

8.                                       No Admissions. Nothing contained herein is an admission of wrongdoing or liability by either party to this Agreement.

 

9.                                       Entire Agreement, California Law. This Separation Agreement constitutes a single integrated contract expressing the entire agreement of the parties with respect to the subject matter hereof and supersedes and controls over all prior and contemporaneous oral and written agreements and discussions with respect to the subject matter hereof. There are no other agreements, written or oral, express or implied, between the parties hereto, concerning the subject matter of this Separation Agreement, except as set forth herein. This Separation Agreement may be amended or modified only in writing. This Separation Agreement is governed by California law.

 

10.                                 Partial Invalidity. The invalidity or unenforceability of any provision or portion of this Separation Agreement will not affect the validity or enforceability of the other provisions or portions of this Separation Agreement. Should any provision or portion of this Separation Agreement be declared invalid or unenforceable, the remaining provisions of this Separation Agreement shall remain in full force and effect.

 

 

	
Dated: May 21, 2012
    	
/s/ Neil Dial
    
	
 
    	
Neil Dial
    
	
 
    	
 
    
	
 
    	
 
    
	
Dated: May 21, 2012
    	
POWER-ONE, INC.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
/s/ Alex Levran
    
	
 
    	
By:
    	
Alex Levran
    
	
 
    	
 
    	
President, Renewable Energy Solutions
    

 

2LTM-2012-Q2 Exhibit 10.2

EXHIBIT 10.2

AMENDMENT NO. 1
 
to
 
THIRD AMENDED AND RESTATED CREDIT AGREEMENT
This Amendment No. 1 to Third Amended and Restated Credit Agreement (the “Amendment”) is dated June 8, 2012 and is between Life Time Fitness, Inc., a Minnesota corporation (“Company”), U.S. Bank National Association, a national banking association, as Agent (“Agent”), and the Lenders who have signed this Amendment.
Company, Agent, and the Lenders are parties to the Third Amended and Restated Credit Agreement dated as of June 30, 2011 (the “Original Agreement”).  Each capitalized term in this Amendment that this Amendment does not define has the meaning the Original Agreement gives it.  
Company has requested certain amendments to the Original Agreement, and Agent and Lenders constituting Majority Lenders have agreed to amend the Original Agreement pursuant to this Amendment. 
Therefore, Company, Agent, and the Lenders who have signed this Agreement agree as follows:
1.Effect of Amendment.  The Original Agreement is in full force and effect and has not been amended or modified.  This Amendment amends the Original Agreement.  To the extent the Original Agreement and this Amendment conflict or are inconsistent, this Amendment controls.  Except to the extent this Amendment expressly does so, this Amendment does not, by implication or otherwise, limit, impair, constitute a waiver of, or otherwise affect Agent’s or the Lenders’ rights and remedies under the Original Agreement or any other Loan Document, and does not alter, modify, amend or in any way affect any of the terms, conditions, obligations, covenants, or agreements in the Original Agreement or any other Loan Document, all of which Company ratifies and affirms in all respects, and all of which shall continue in full force and effect.  The Original Agreement, as amended by and together with this Amendment, is the “Agreement”, and each reference in the Original Agreement and the other Loan Documents “Agreement” refers to the Original Agreement as amended by and together with this Amendment.  
2.Amendments.  The Original Agreement is hereby amended as follows:
a.Pledge of Equity Interests.  Section 5.19 of the Original Agreement is hereby deleted and replaced in its entirety with the following:
“    5.19    Pledge of Equity Interests.  Notwithstanding any other term of this Agreement to the contrary, Company shall grant, and cause its applicable Restricted Subsidiaries to grant, a continuing perfected Lien to Agent, for the benefit 

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of the Lenders, in the Equity Interests Company or any of its Restricted Subsidiaries owns in each Restricted Subsidiary other than each Encumbered Real Estate Subsidiary that is prohibited, restricted, or otherwise limited by the Related Agreements for a Permitted Permanent Loan to which it or any of its Subsidiaries is a party from permitting a Lien on the Equity Interests in such Encumbered Real Estate Subsidiary to secure any Indebtedness other than such Permitted Permanent Loan, but only so long as such prohibitions, restrictions, or limitations apply; except that, in the case of a Foreign Subsidiary that is a Restricted Subsidiary where the granting of such pledge would result in a Deemed Dividend Problem, the Lien of such pledge shall be limited to 65% of the Equity Interest of such Subsidiary.”
b.Definition of Acquisition.  Section 1.1 of the Original Agreement is hereby amended as follows:
i.The definition of “Acquisition” in Section 1.1 of the Original Agreement is hereby deleted and replaced in its entirety with the following:
“    “Acquisition”:  Any transaction or series of transactions consummated after the Effective Date by which Company or any of its Subsidiaries acquires, either directly or through an Affiliate or otherwise, (a) any or all of the stock or other securities of any class of any Person if, after giving effect to such transaction, such Person would be an Affiliate of Company; or (b) a substantial portion of the assets, or a division, or line of business of any Person, except that “Acquisition” does not include (i) the acquisition of fee title to any real estate, improved or unimproved, or a leasehold estate in real estate, or the Equity Interests of any Person whose assets consist solely of any such real estate or leasehold estate in real estate and related fixtures and personal property, that Company or any Subsidiary or the acquired entity intends to use, operate, or develop, either wholly or in substantial part, as a Club or otherwise in the ordinary course of the businesses engaged in by Company or its Restricted Subsidiaries on the Effective Date or other businesses that are similar, ancillary, or complementary lines of business, or are reasonable extensions of such business, (ii) the acquisition of the lessor’s interest any real estate and related improvements and other assets that Company or any Subsidiary leases under a sale-leaseback transaction permitted by Section 6.18 of the Original Agreement, or (iii) the acquisition of any Existing Club that Company or any of its Subsidiaries intends to use, operate, or develop as a Club.” 
ii.The definition of “Encumbered Real Estate Subsidiary” in Section 1.1 of the Original Agreement is hereby deleted and replaced in its entirety with the following:

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“    “Encumbered Real Estate Subsidiary”:  Any Subsidiary that (a) is the obligor on a Permitted Permanent Loan, including any Related Mezzanine Encumbered Real Estate Subsidiary; or (b) is a Related Encumbered Real Estate Subsidiary.  The Encumbered Real Estate Subsidiaries on the Effective Date are listed in Schedule 1.1.b”
iii.The following definition of “Existing Club” is hereby added to Section 1.1 in alphabetical order:
“    “Existing Club”:  A health club facility owned by a Person other than Company or any Subsidiary, together with any and all related improvements and other assets used in the normal course of operation of such facility, including, but not limited to, real estate and equipment.”
iv.The following definition of “Related Encumbered Real Estate Subsidiary” is hereby added to Section 1.1 in alphabetical order:
“    “Related Encumbered Real Estate Subsidiary”:  Any Subsidiary whose assets consist solely of the Equity Interests of one or more Encumbered Real Estate Subsidiaries.”
c.Sale Leasebacks.  Section 6.11.f of the Original Agreement is hereby deleted and replaced with the following:
“    f.    Contingent liabilities permitted by Section 6.13 and sale leaseback transactions permitted by Section 6.18.”
d.Contingent Liabilities.  Clause (a)(vi) of Section 6.13 of the Original Agreement is hereby deleted and replaced in its entirety with the following:  
“(vi) Company’s guaranty of the obligations of any Subsidiary as the lessee under ground leases, sale leaseback leases, or other real estate leases covering any real estate that Company or any Subsidiary intends to use, operate, or develop, either wholly or in substantial part, as a Club or otherwise in the ordinary course of the businesses engaged in by Company or its Restricted Subsidiaries on the Effective Date or other businesses that are similar, ancillary, or complementary lines of business, or are reasonable extensions of such business (including, without limitation, the lease guaranties existing on the Effective Date and described in Schedule 6.13) so long as:  (A) the applicable Related Agreements evidencing any lease guaranty issued after the Effective Date shall not:  (1) impose any materially greater liability on Company than that incurred by Company pursuant to the lease guaranty Company gave as part of the LTF CMBS I Related Agreements; (2)(a) 

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EXHIBIT 10.2

cross-default to any other Indebtedness of Company or any other Subsidiary; and/or (b) violate Section 6.6; and/or (c) require Company to waive its rights of contribution, subrogation, or other similar rights to succeed to the relevant lender’s rights against the applicable Subsidiary or its assets upon Company’s payment and performance in full of its obligations under such Related Agreements; and (B) in the case of a ground lease, such ground lease contains the material provisions that are routinely required by rating agencies in connection with rating a Securitized commercial loan that is secured by a leasehold mortgage (any guaranty described in this clause (a)(vi) shall cause any automatic amendment of this Agreement that applies under the “most favored lender” provision in Section 5.20);”.
e.Restricted Payments.  Section 6.7.a of the Original Agreement is hereby amended by inserting “and its Restricted Subsidiaries” after “Company" in the second line.  
f.Prepayments.  Section 6.7.d of the Original Agreement is hereby amended by deleting the following phrase from the last two lines: “and such prepayment does not require Company or any of its Subsidiaries to pay any prepayment premium or penalty”.  
3.Representations and Warranties.  To induce Agent to enter into this Amendment, Company represents and warrants to Agent as follows:
a.    The signing, delivery, and performance by Company of this Amendment have been duly authorized by all necessary corporate action, do not require any approval or consent of, or any registration, qualification or filing with, any government agency or authority or any approval or consent of any other person (including, without limitation, any stockholder) that has not been obtained, do not and will not conflict with, result in any violation of, or constitute a default under, any provision of Company’s articles of incorporation or bylaws, any agreement that binds or applies to Company or any of its assets, or any law or governmental regulation or court decree or order that binds or applies to Company or any of its assets, and will not result in the creation or imposition of any security interest or other lien or encumbrance in or on any of its assets under any agreement that applies to Company or any of its assets, except under the Agreement and the other Loan Documents.  
b.    No events have occurred and no circumstances exist on the date of this Agreement that would give Company the right to assert a defense, offset, or counterclaim to any claim by Agent or any Lender for the payment of the Obligations that now exist or that arise in the future under the Agreement or any other Loan Document.
c.    The Original Agreement, as amended by this Amendment, and each other Loan Document to which Company is a party remains in full force and effect and is the 

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Amendment No. 1 to
 
Third Amended and Restated Credit Agreement

EXHIBIT 10.2

legal, valid, and binding obligation of Company and is enforceable in accordance with its terms, subject only to limitations on enforceability that result from bankruptcy, insolvency, moratorium, and other similar laws affecting creditors’ rights generally and subject to limitations on the availability of equitable remedies.  
d.    No Default, Event of Default, or Material Adverse Occurrence exists on the date of this Amendment after giving effect to this Amendment.
4.Costs and Expenses.  Company shall reimburse Agent for all reasonable out-of-pocket costs and expenses Agent pays or incurs in connection with negotiating, preparing, signing, and delivering this Amendment, including the fees and expenses of Fabyanske, Westra, Hart & Thomson, P.A., as counsel to Agent.  
5.Governing Law.  THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF MINNESOTA, WITHOUT GIVING EFFECT TO CONFLICT OF LAWS PRINCIPLES, BUT GIVING EFFECT TO FEDERAL LAWS OF THE UNITED STATES THAT APPLY TO NATIONAL BANKS.
6.Captions.  The captions and headings to this Amendment are for convenience only and in no way define, limit, or describe the scope or intent of any provision of this Amendment.  
7.Counterparts.  This Amendment may be signed and delivered in any number of separate counterparts, all of which taken together shall constitute one and the same agreement.  The delivery of a copy of signed counterpart of a signature page to this Amendment by email or fax has the same binding effect as the delivery of an original signed by hand in ink on paper.  
Signature Pages Follow

Company and Agent hereby sign this Amendment No. 1 to Third Amended and Restated Credit Agreement.
Life Time Fitness, Inc.
By:    /s/ Michael R. Robinson             
 
Name:  Michael R. Robinson                
 
Title:    EVP and CFO                    

U.S. Bank National Association
By:    /s/ Ludmila Yakovlev                
 
Name:    Ludmila Yakovlev                
 
Title:    Assistant Vice President            
 

	
		
	

	JPMorgan Chase Bank, N. A.

By:  /s/ Krys Szremski                                                          
Name:   Krys Szremski            
Title:   Vice President            

	 

	
		
	

	Royal Bank of Canada

By:_/s/ John Flores_____                    ______
Name: _John Flores_____                    ______   
Title:   Authorized Signatory_________  ____

	 

	
		
	

	Bank of America National Association

By:  /s/ Olivier Lopez            
Name:   Olivier Lopez            
Title:   Vice President                    

	 

	
		
	

	Compass Bank

By:    /s/ Brandon Kelley         
Name:   Brandon Kelley         
Title:   Senior Vice President         

	

	
		
	 
	RBS Citizens, N.A.

By:  /s/ Mark Wegener         
Name:   Mark Wegener         
Title:   Senior Vice President         

	 

	
		
	

	BMO Harris Bank National Association

By:   /s/ Kristin Leuer            
Name:   Kristin Leuer            
Title:   Vice President            

and

By:  /s/ Barbara Nieland                  
Name:   Barbara Nieland         
Title:  Senior Vice President         

	 

	
		
	

	Bank of the West, a California banking corporation

By:  /s/ Philip P. Krump         
Name:   Philip P. Krump         
Title:   Vice President            

	

	
		
	

	Fifth Third Bank

By:  /s/ Gary S. Losey            
Name:   Gary S. Losey            
Title:   Vice President            

	

	
		
	 
	Union Bank, N.A.

By:   Michael Gardner            
Name:   Michael Gardner         
Title:   Vice President            

	 

	
		
	

	Associated Bank, National Association

By:   /s/ Paul Way            
Name:    Paul Way            
Title:    Senior Vice President         

	 

	
		
	

	BOKF, N.A., dba Bank of Texas

By:  /s/ Alan Morris            
Name:   Alan Morris            
Title:   Vice President            

	

	
		
	

	Branch Banking and Trust Company

By:  /s/ Kenneth M. Blackwell      
Name:   Kenneth M. Blackwell      
Title: Senior Vice President         

	

	
		
	

	First Tennessee Bank National Association

By:  /s/ Bob Nieman            
Name:   Bob Nieman            
Title:   Senior Vice President         

	

	
		
	

	Bank of Taiwan, New York Agency

By:                  
Name:                  
Title:                  

	

	
		
	

	Mega International Commercial Bank Co., Ltd. Silicon Valley Branch

By:                  
Name:                  
Title:                  

	

	
		
	

	Chang Hwa Commercial Bank, Ltd.

By:  /s/ Chu-I Hung            
Name:   Chu-I Hung            
Title:  Vice President and General Manager   

	
		
	

	Taiwan Cooperative Bank

By:                  
Name:                  
Title:                  

	 

	
		
	 
	Hua Nan Commercial Bank, Ltd. New York Agency 

By:                  
Name:                  
Title:                  

	 

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Amendment No. 1 to
 
Third Amended and Restated Credit Agreement

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