SEPARATION AGREEMENT AND GENERAL RELEASE
This Separation Agreement and General Release (this “Agreement”) is entered into by and between Marcellous P. Frye, Jr. (“Executive”) and Washington Gas Light Company, a corporation duly organized and existing under the laws of the District of Columbia and the Commonwealth of Virginia (the “Company”).
WHEREAS, Executive currently serves as the Vice President of Economic Development and Strategy of the Company;
WHEREAS, the Company currently maintains the WGL Holdings, Inc. and Washington Gas Light Company Change in Control Severance Plan for Certain Executives (as amended, the “CIC Severance Plan”), and Executive participates in the CIC Severance Plan;
WHEREAS, WGL Holdings, Inc., a Virginia corporation and parent of the Company (“Holdings”), maintains the WGL Holdings, Inc. 2016 Omnibus Incentive Compensation Plan (the “Omnibus Plan”), pursuant to which Executive has been granted certain long-term incentive awards, including grants of equity compensation awards and cash-settled performance unit awards (“LTI Awards”);
WHEREAS, on July 6, 2018, Holdings consummated the transactions contemplated by that certain Agreement and Plan of Merger, dated as of January 25, 2017 (the “Merger Agreement”), by and among AltaGas Ltd., a Canadian corporation (“Parent”), Wrangler Inc., a Virginia corporation, and Holdings;
WHEREAS, on or about August 1, 2018, Executive and Company entered into a retention agreement which provided for a retention bonus to be paid to Executive under certain circumstances (the “Retention Bonus Letter Agreement”);
WHEREAS, Executive’s employment with the Company will end effective as of May 10, 2019 (the “Separation Date”);
WHEREAS, the parties desire for Executive to receive (i) the benefits Executive is eligible to receive upon a Good Reason Resignation (as defined in the CIC Severance Plan) under the CIC Severance Plan, which benefits are conditioned upon Executive’s timely execution (and non-revocation) of this Agreement and Executive’s compliance with the terms of this Agreement, and (ii) accelerated vesting of Executive’s Post-Signing LTI Awards (as defined below) upon a Good Reason Resignation as provided in the Company Disclosure Schedules to the Merger Agreement (the “Disclosure Schedules”);
WHEREAS, this Agreement is intended to qualify as the “Separation of Employment Agreement and General Release” referenced in Section 2.23 of the CIC Severance Plan; and
WHEREAS, the parties wish to resolve any and all claims that Executive has or may have against the Company or any of the other Company Parties (as defined below), including any claims that Executive may have arising out of Executive’s employment or the end of such employment.
NOW, THEREFORE, in consideration of the promises set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the parties, the parties agree as follows:
1.Separation from Employment. Executive’s employment with the Company will end effective as of the Separation Date. The parties hereby acknowledge and agree that such termination is a Good Reason Resignation for purposes of the CIC Severance Plan and the Post-Signing LTI Awards. As of the Separation Date, Executive will not have any further employment relationship with the Company or any other Company Party. The end of Executive’s employment with the Company on the Separation Date shall constitute, as applicable, an automatic resignation of Executive: (a) as an officer of the Company, Holdings, and their direct and indirect subsidiaries (collectively, the “Company Group”); and (b) from the board of directors or board of managers (or similar governing body) of any member of the Company Group and from the board of directors or board of managers (or similar governing body) of any corporation, limited liability entity, unlimited liability entity or other entity in which any member of the Company Group holds an equity interest and with respect to which board of directors or board of managers (or similar governing body) Executive serves as such Company Group member’s designee or other representative.
2. Separation Benefits and Additional Benefits.
(a) Provided that Executive (x) executes this Agreement on or after the Separation Date and returns it to Luanne S. Gutermuth, EVP and Chief Administrative Officer, at 6801 Industrial Road, Springfield, VA 22151, no later than May 28, 2019; (y) does not exercise his revocation right described in Section 6 of this Agreement; and (z) abides by each of his commitments set forth herein and in the CIC Severance Plan, then:
Pursuant to Section 4.1(a) of the CIC Severance Plan, the Company will provide Executive with a salary replacement benefit in the total amount of $1,211,262.80, less applicable taxes and withholdings (the “Severance Payment”), which amount (I) equals the sum of: (A) an amount equal to the product of (1) Executive’s Annual Bonus (as defined in the CIC Severance Plan) for the 2019 calendar year ($189,500), multiplied by (2) a fraction, the numerator of which is the number of days in the 2019 calendar year up to and including the Separation Date and the denominator of which is 365; (B) an amount equal to the product of (1) the sum of (x) Executive’s Base Salary (as defined in the CIC Severance Plan plus (y) Executive’s Annual Bonus, and (2) two, and (C) Executive’s unpaid current-year PTOA through the Separation Date (II) is subject to adjustment under Section 4.5 of the CIC Severance Plan. In accordance with Section 5.1 of the CIC Severance Plan, the Severance Payment will be paid in a single lump sum on the date that is 65 days after the Separation Date (the date of such payment, the “Separation Payment Date”);
Pursuant to Section 4.1(b)(1) of the CIC Severance Plan, Executive shall continue to be eligible to participate in the medical and dental coverage in effect with respect to Executive on the Separation Date for Executive and,
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