WHELEN ENG VICE PRESIDENT $600,000 PER YEAR, ARTIFICIAL INTELLIGENCE EXAMINES CONTRACT

This Release and Severance Agreement between a Vice President (Employee) and Whelen Engineering Company, Inc. (Company) outlines the terms of the employee's separation, including severance pay, confidentiality, non-disparagement, and a broad release of claims. Below is a structured analysis of key provisions:

1. Separation Terms & Severance Payments
Voluntary Resignation: The Company will record the separation as a voluntary resignation (not termination).

Severance Structure:
$900,000 (24 months’ salary + prorated bonus), paid in weekly installments over 24 months.
$300,000 lump sum paid at the end of the 24-month period.

Payments begin after the 7-day revocation period (see below). Taxes: All payments are subject to standard withholdings (W-2 reported).
Conditions: Payments are contingent on the employee’s compliance with the Supplemental Benefits Agreement (e.g., non-compete, confidentiality) and this agreement.

2. Supplemental Benefits Agreement
Continues in effect, including:
Confidentiality (Section 3)
Inventions/Patents (Section 4)
Non-Compete & Non-Solicitation (Section 5)
Enforcement (Section 6)
Long-Term Care Insurance: Company will cover premiums (up to 110% of average for other officers) if policies are unavailable commercially.
Breach Consequences: Failure to comply voids severance payments and permits the Company to seek legal remedies.

3. Release of Claims (Key Waivers)
The employee irrevocably waives all claims against the Company, including:
Employment laws: Title VII, ADEA, Connecticut Fair Employment Practices Act.
Contract/tort claims: Wrongful discharge, defamation, emotional distress, breach of good faith.
Exceptions:
Vested retirement benefits (e.g., profit-sharing).
Right to file EEOC/CHRO complaints (but waives monetary recovery).
Right to cooperate in government investigations.

4. Employee Obligations
Confidentiality: Cannot disclose agreement terms except to spouse, attorney, or as legally required.
Non-Disparagement: Both parties agree not to make negative statements.
No Admission of Liability: The agreement is not an admission of wrongdoing by the Company.

5. Legal Safeguards
21-Day Consideration Period: Employee had 21 days to review (cannot reset if terms change).
7-Day Revocation Right: Employee may revoke acceptance within 7 days of signing.
Attorney Consultation: Employee advised to seek legal counsel.
Governing Law: Connecticut (no conflict-of-law principles).

6. Enforcement & Penalties
Severability: Unenforceable provisions may be modified or ignored without invalidating the rest.
Indemnification: Employee must repay severance and cover legal costs if suing in violation of the agreement.
Remedies for Breach: Company may cease payments and recover prior payments if the employee violates terms.

Key Takeaways
Generous Severance: $1.2 million total, tied to strict compliance with post-employment restrictions.
Strong Protections for Company: Broad release of claims, non-compete, and confidentiality clauses.
Employee Safeguards: Revocation period, attorney review, and carve-outs for lawful whistleblowing.
Risk for Employee: Breach (e.g., disparagement, violating non-compete) could result in forfeiture of all payments.

This agreement is highly favorable to the Company, ensuring a clean separation while mitigating legal risks. The employee benefits from substantial compensation but must adhere to restrictive covenants. Legal counsel review was critical given the complexity and finality of the waiver provisions.