-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, M3SzL2bAeP4yACQ+OXeUtO5uRT9UYP5KYy5AEsOvYAF54JN8d8TViRXn3jt6xsNO 09NwtHazHZHMsYZIaJKpww== 0000950124-07-002120.txt : 20070411 0000950124-07-002120.hdr.sgml : 20070411 20070411150040 ACCESSION NUMBER: 0000950124-07-002120 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 20070411 DATE AS OF CHANGE: 20070411 GROUP MEMBERS: TONI L. HERRICK SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: TECUMSEH PRODUCTS CO CENTRAL INDEX KEY: 0000096831 STANDARD INDUSTRIAL CLASSIFICATION: AIR COND & WARM AIR HEATING EQUIP & COMM & INDL REFRIG EQUIP [3585] IRS NUMBER: 381093240 STATE OF INCORPORATION: MI FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-30158 FILM NUMBER: 07761112 BUSINESS ADDRESS: STREET 1: 100 E PATTERSON ST CITY: TECUMSEH STATE: MI ZIP: 49286 BUSINESS PHONE: 5174238411 MAIL ADDRESS: STREET 1: 100 EAST PATTERSON STREET CITY: TECUMSEH STATE: MI ZIP: 49286 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: HERRICK TODD W CENTRAL INDEX KEY: 0000920678 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 150 W JEFFERSON STREET 2: SUITE 2500 CITY: DETROIT STATE: MI ZIP: 48226 BUSINESS PHONE: 3134967570 MAIL ADDRESS: STREET 1: 100 EAST PATTERSON STREET CITY: TECUMSEH STATE: MI ZIP: 49286 SC 13D/A 1 k14075a1sc13dza.txt AMENDMENT NO.3 TO SCHEDULE 13D ------------------------------------------ OMB APPROVAL ------------------------------------------ OMB Number: 3235-0145 Expires: February 28, 2009 Estimated average burden hours per response....................14.5 ------------------------------------------ UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 13D Under the Securities Exchange Act of 1934 (Amendment No. 3)* Tecumseh Products Company (Name of Issuer) Class B Common Stock, par value $1.00 per share (Title of Class of Securities) 878895 10 1 (CUSIP Number) Todd W. Herrick 261 Wildwood Tecumseh, Michigan 49286-8706 (517) 423-2278 (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) April 2, 2007 (Date of Event Which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this Schedule because of Sections 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. [ ] NOTE: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7 for other parties to whom copies are to be sent. * The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter the disclosures provided in a prior cover page. The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). POTENTIAL PERSONS WHO ARE TO RESPOND TO THE COLLECTION OF INFORMATION CONTAINED IN THIS FORM ARE NOT REQUIRED TO RESPOND UNLESS THE FORM DISPLAYS A CURRENTLY VALID OMB CONTROL NUMBER. Page 1 of 11 pages CUSIP No. 878895 10 1 - -------------------------------------------------------------------------------- 1. Names of Reporting Persons. I.R.S. Identification Nos. of above persons (entities only) Todd W. Herrick - -------------------------------------------------------------------------------- 2. Check the Appropriate Box if a Member of a Group (See Instructions) (a) [ ] (b) [X] - -------------------------------------------------------------------------------- 3. SEC Use Only - -------------------------------------------------------------------------------- 4. Source of Funds (See Instructions) Not Applicable - -------------------------------------------------------------------------------- 5. Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6. Citizenship or Place of Organization United States of America - -------------------------------------------------------------------------------- 7. Sole Voting Power 21,906 Number of ----------------------------------------------------------------- Shares 8. Shared Voting Power Beneficially 2,193,538 Owned by ----------------------------------------------------------------- Each 9. Sole Dispositive Power Reporting 21,906 Person ----------------------------------------------------------------- With: 10. Shared Dispositive Power 2,193,538 - -------------------------------------------------------------------------------- 11. Aggregate Amount Beneficially Owned by Each Reporting Person 2,215,444 - -------------------------------------------------------------------------------- 12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) [ ] - -------------------------------------------------------------------------------- 13. Percent of Class Represented by Amount in Row (11) 43.6% - -------------------------------------------------------------------------------- 14. Type of Reporting Person (See Instructions) IN - -------------------------------------------------------------------------------- Page 2 of 11 pages - -------------------------------------------------------------------------------- 1. Names of Reporting Persons. I.R.S. Identification Nos. of above persons (entities only) Toni L. Herrick - -------------------------------------------------------------------------------- 2. Check the Appropriate Box if a Member of a Group (See Instructions) (a) [ ] (b) [X] - -------------------------------------------------------------------------------- 3. SEC Use Only - -------------------------------------------------------------------------------- 4. Source of Funds (See Instructions) Not Applicable - -------------------------------------------------------------------------------- 5. Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6. Citizenship or Place of Organization United States of America - -------------------------------------------------------------------------------- 7. Sole Voting Power 0 ----------------------------------------------------------------- Number of 8. Shared Voting Power Shares 888,113(1) Beneficially ----------------------------------------------------------------- Owned by 9. Sole Dispositive Power Each 0 Reporting ----------------------------------------------------------------- Person 10. Shared Dispositive Power With: 888,113(1) - -------------------------------------------------------------------------------- 11. Aggregate Amount Beneficially Owned by Each Reporting Person 888,113(1) - -------------------------------------------------------------------------------- 12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) [ ] - -------------------------------------------------------------------------------- 13. Percent of Class Represented by Amount in Row (11) 17.5% - -------------------------------------------------------------------------------- 14. Type of Reporting Person (See Instructions) IN - -------------------------------------------------------------------------------- - ---------- (1) These shares are included in the shares shown as beneficially owned by Todd W. Herrick. Page 3 of 11 pages ITEM 1. SECURITY AND ISSUER. The title of the class of equity securities to which this statement relates is Class B Common Stock, par value $1.00 per share ("Class B Stock"), of Tecumseh Products Company, a Michigan corporation ("Tecumseh"). The address of Tecumseh's principal executive offices is 100 East Patterson Street, Tecumseh, Michigan 49286. ITEM 2. IDENTITY AND BACKGROUND. This statement is being filed by Todd W. Herrick and Toni L. Herrick. Todd W. Herrick's address is 261 Wildwood, Tecumseh, Michigan 49286-8706. Todd W. Herrick is Chairman Emeritus of Tecumseh and a consultant to Tecumseh and this is his present principal occupation or employment. Toni L. Herrick's address is 7028 Foxmoor Court E, P.O. Box 19555, Kalamazoo, Michigan 49009. Toni L. Herrick is an artist and this is her present principal occupation or employment. Toni L. Herrick is Todd W. Herrick's sister. Tecumseh's principal business address is 100 East Patterson Street, Tecumseh, Michigan 49286. Neither Todd W. Herrick nor Toni L. Herrick has, during the last five years, been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors). Neither Todd W. Herrick nor Toni L. Herrick has, during the last five years, been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. Todd W. Herrick and Toni L. Herrick are citizens of the United States of America. ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION. Not applicable. ITEM 4. PURPOSE OF TRANSACTION. Todd W. Herrick's purpose in serving as one of the trustees of Herrick Foundation is to take part in the management of its charitable activities. Todd W. Herrick's and Toni L. Herrick's purpose in serving as trustees of the Ray W. Herrick and Hazel M. Herrick Trusts u/a/d February 26, 1949 and February 24, 1956 f/b/o Kenneth Herrick and his descendants (the "Trusts") is to take part in the management of the activities of the Trusts of which one of them is the beneficiary. In his capacity as Chairman Emeritus of Tecumseh, as a consultant to Tecumseh, as a member of the Board of Trustees of Herrick Foundation, as a trustee of the Trusts and/or in his personal capacity, Todd W. Herrick, and in her capacity as a trustee of the Trusts and/or in her personal capacity, Toni L. Herrick, expect from time to time to be presented with, give consideration to, and/or act upon, proposals similar to those enumerated below and/or proposals that one or more of Tecumseh, Herrick Foundation, the Trusts, Todd W. Herrick and/or Toni L. Page 4 of 11 pages Herrick acquire, dispose of, or vote shares of Class B Stock or other securities of Tecumseh, including, without limitation, by public or private sale (registered or unregistered and with or without the simultaneous sale of newly-issued shares of Class B Stock by Tecumseh), gift, pledge or otherwise, including, without limitation, sales of Class B Stock pursuant to Rule 144 under the Securities Act of 1933, as amended, or otherwise. Todd W. Herrick, as Chairman Emeritus of Tecumseh, as a consultant to Tecumseh, as a member of the Board of Trustees of Herrick Foundation, as a trustee of the Trusts, and/or in his personal capacity, and Toni L. Herrick, as a trustee of the Trusts and/or in her personal capacity, reserve the right not to acquire Class B Stock or not to dispose of all or part of such Class B Stock if he or she determines such acquisition or disposal is not in Tecumseh's, Herrick Foundation's, the Trusts' or his or her personal best interests at that time. On March 6, 2007, Todd W. Herrick and the Herrick Foundation filed a lawsuit against Albert A. Koch, Peter M. Banks, David M. Risley (collectively, the "Director Defendants") and Tecumseh in the Lenawee County Circuit Court, Case No. 07-2525-CZ (the "Herrick Lawsuit"). On March 20, 2007, Tecumseh filed a lawsuit against Todd W. Herrick, Kent B. Herrick, Toni Herrick, Michael Indenbaum and Herrick Foundation in the United States District Court for the Eastern District of Michigan, Southern Division, Case No. 07-2525-CZ (the "Tecumseh Lawsuit"). On April 2, 2007, Tecumseh entered into a Settlement and Release Agreement, a copy of which is attached as Exhibit 99.2 and incorporated into this Schedule by reference (the "Settlement Agreement"), with Todd W. Herrick, Kent B. Herrick, Toni L. Herrick, Herrick Foundation, and Michael A. Indenbaum (collectively, the "Herrick Entities") and the Director Defendants settling corporate governance disputes that had been the subject of the Herrick Lawsuit and the Tecumseh Lawsuit. Under the Settlement Agreement, among other things: - Board of directors - There will continue to be five directors of Tecumseh until it names a new permanent Chief Executive Officer. - Todd W. Herrick resigned from Tecumseh's board and became "Chairman Emeritus," with the right to attend board meetings and to receive materials distributed to the board, but with no vote. Todd W. Herrick will continue as "Chairman Emeritus" during the term of the Settlement Agreement, which continues until the earlier of the conclusion of Tecumseh's 2008 annual meeting of shareholders or April 30, 2008. - The board appointed Kent B. Herrick to fill the vacancy created by Todd Herrick's resignation. The board must continue to nominate Kent B. Herrick for re-election to the board during the term of the Settlement Agreement. - A search committee is to be charged with immediately locating a new director with restructuring experience reasonably acceptable to the independent members of the board and who is not affiliated with AlixPartners. Mr. Koch must resign from the board by the earliest of: (1) the date this new director is appointed; (2) 60 days after Tecumseh appoints its new Chief Executive Officer; or (3) July 31, 2007. Page 5 of 11 pages - When Tecumseh names a new permanent Chief Executive Officer, the board will be expanded to seven members. The new Chief Executive Officer will become a director and Chairman of the Board. At that time, Tecumseh also must appoint Steven Lebowski to the board if he qualifies as an "independent director" under Nasdaq rules, and Tecumseh must continue to nominate Mr. Lebowski for re-election to the board during the term of the Settlement Agreement. If Mr. Lebowski does not qualify as an independent director, Tecumseh must follow a process set forth in the Settlement Agreement to select and appoint another person selected by Kent B. Herrick who does qualify. - Management - The search for a new permanent Chief Executive Officer of Tecumseh will continue. Appointment of a new Chief Executive Officer must be approved by majority vote of the full five-member board. - Mr. Bonsall will continue as President and Chief Operating Officer under Tecumseh's existing contract with his employer, AP Services, LLC, while the Chief Executive Officer search is in progress. - Todd W. Herrick will serve as a consultant to Tecumseh in a capacity to be determined by the new Chief Executive Officer. He will not receive any compensation but will be entitled to reimbursement for reasonable and documented expenses. - When Tecumseh's new Chief Executive Officer is appointed, he will decide whether or not to rehire Kent B. Herrick and, if so, in what capacity. If Mr. Herrick is rehired, he will receive an agreement to provide him with a lump sum severance payment on termination equal to one year's salary less any salary paid to him from the date he is rehired through the date of his termination. If the new Chief Executive Officer has not rehired Mr. Herrick within three months after his appointment, Mr. Herrick will be entitled to a lump sum severance payment equal to one year's salary at the rate in effect when he was terminated from his position with Tecumseh on January 19, 2007. - Other matters - The parties dismissed their lawsuits with prejudice. Tecumseh and the Director Defendants agreed not to challenge the right of Todd W. Herrick and the other Herrick Entities to vote their shares and agreed that they have the right to vote all of their shares. - Tecumseh agreed to reimburse Todd W. Herrick and the other Herrick Entities for their reasonable and documented expenses in connection with the Herrick Lawsuit and the Tecumseh Lawsuit, the Settlement Agreement, and other specified matters, up to a maximum of $300,000. - Todd W. Herrick and the other Herrick Entities agreed to exercise their voting rights in a manner consistent with the terms of the Settlement Agreement. - Various parties released each other from claims in connection with the matters referenced in the Settlement Agreement. Execution of the settlement agreement was a condition precedent to the effectiveness of the amendments to Tecumseh's First and Second Lien Credit Agreements that Tecumseh Page 6 of 11 pages recently signed. The Settlement Agreement has additional terms and conditions, and the full Settlement Agreement, attached as Exhibit 99.2, should be reviewed in its entirety. Other than as described above and other than as described in Tecumseh's SEC filings, neither Todd W. Herrick nor Toni L. Herrick has any current plans or proposals which relate to, or would result in, (a) the acquisition by any person of additional securities of Tecumseh, or the disposition of securities of Tecumseh, except for the disposition of shares of Class B Stock required by rules under the Internal Revenue Code of 1986, (b) any extraordinary corporate transaction, such as a merger, reorganization or liquidation, involving Tecumseh or any of its subsidiaries, other than those described by Tecumseh in its SEC filings, (c) any sale or transfer of a material amount of assets of Tecumseh or any of its subsidiaries, other than those described by Tecumseh in its SEC filings, (d) any change in the present board of directors or management of Tecumseh, including any plans or proposals to change the number or term of directors or to fill any existing vacancies on the board, except as described above and except that, from time to time, Tecumseh might add additional directors to fill existing vacancies if it finds qualified candidates willing to serve and from time to time, directors might resign and the Second Lien Credit Agreement includes a commitment to create an advisory committee to assist Tecumseh's Board of Directors in working with a nationally recognized executive recruiting firm and to recommend to the board qualified candidates for various executive management positions, including the Chief Executive Officer position, (e) any material change in Tecumseh's present capitalization or dividend policy, (f) any other material change in Tecumseh's business or corporate structure, (g) any changes in Tecumseh's Articles of Incorporation or Bylaws or other actions which may impede the acquisition of control of Tecumseh by any person, (h) causing a class of securities of Tecumseh to be delisted from a national securities exchange or to cease to be authorized to be quoted in an inter-dealer quotation system of a registered national securities association, (i) a class of Tecumseh's equity securities becoming eligible for termination of registration pursuant to Section 12(g)(4) of the Securities Exchange Act of 1934, as amended, or (j) any action similar to those enumerated above. The foregoing notwithstanding, Todd W. Herrick and Toni L. Herrick intend to remain free to take such actions, including the making of such proposals, as he or she may from time to time deem appropriate in light of the circumstances which might arise from time to time. ITEM 5. INTEREST IN SECURITIES OF THE ISSUER. The number and percentage of shares of Class B Stock beneficially owned by Todd W. Herrick and Toni L. Herrick as of April 11, 2007 are as follows:
Number Percent --------- -------- Todd W. Herrick 2,215,444(1) 43.6%(2) Toni L. Herrick 888,113(3) 17.5%(2)
(1) The shares shown above as beneficially owned by Todd W. Herrick consist of (1) 21,906 shares of Class B Stock owned by Todd W. Herrick, (2) 1,305,425 shares owned by Herrick Foundation, of which Todd W. Herrick is one of three members of the Board of Trustees, and (3) 888,113 shares of Class B Stock held by the Trusts of which Todd W. Herrick and Toni L. Page 7 of 11 pages Herrick are the trustees who are descendants of Kenneth Herrick and, therefore, control the Trusts' Tecumseh stock. (2) Based on the 5,077,746 shares of Class B Stock reported as outstanding as of September 30, 2006 in Tecumseh's Quarterly Report on Form 10-Q for the quarter ended September 30, 2006. (3) The shares shown above as beneficially owned by Toni L. Herrick consist of 888,113 shares of Class B Stock held by the Trusts of which Todd W. Herrick and Toni L. Herrick are the trustees who are descendants of Kenneth Herrick and, therefore, control the Trusts' Tecumseh stock. These shares are also shown above as beneficially owned by Todd W. Herrick. Todd W. Herrick is the sole beneficial owner of 21,906 shares of Class B Stock, or approximately 0.4% of the outstanding Class B Stock. Todd W. Herrick is also one of three members of the Board of Trustees of Herrick Foundation, the others being Kent B. Herrick and Michael A. Indenbaum. Herrick Foundation is a Michigan nonprofit corporation, which is a "Private Foundation" as defined in the Internal Revenue Code of 1986, as amended, organized for charitable purposes. Herrick Foundation owns 1,305,425 shares of Class B Common Stock, or approximately 25.7% of the outstanding shares of Class B Stock. Kent B. Herrick is Todd W. Herrick's son, has been a director of Tecumseh since April 10, 2007 and was the Executive Vice President of Global Business Development of Tecumseh until January 19, 2007 and this was his present principal occupation or employment. Kent B. Herrick's address is 9693 Woodbend, Saline, Michigan 48176, and Tecumseh's business address at 100 East Patterson Street, Tecumseh, Michigan 49286. Kent B. Herrick is a citizen of the United States of America. Michael A. Indenbaum is an attorney and this is his present principal occupation or employment. Michael A. Indenbaum's business address is 2290 First National Building, 660 Woodward Ave., Detroit, Michigan 48226-3506. He carries on his business as a partner of Honigman Miller Schwartz and Cohn LLP, a law firm organized as a Michigan limited liability partnership ("Honigman"). The principal business address of Honigman at which Michael A. Indenbaum carries on that business is 2290 First National Building, 660 Woodward Ave., Detroit, Michigan 48226-3506. Michael A. Indenbaum is a citizen of the United States of America. Todd W. Herrick and Toni L. Herrick share voting and investment power over the shares of Class B Common Stock held in the Trusts. Michael A. Indenbaum and National City Bank are also trustees of the Trusts, but they do not exercise any voting or investment power over the Tecumseh shares held in the Trusts. Comerica Bank resigned as a trustee of the Trusts effective December 31, 2006 and National City Bank became a trustee of the Trusts effective March 15, 2007. National City Bank is a national banking association with its principal offices located at National City Center, 1900 East Ninth Street, Cleveland, Ohio 44114-3484. The Trusts own Page 8 of 11 pages 888,113 shares of Class B Common Stock, or approximately 17.5% of the outstanding Class B Stock. None of Kent B. Herrick, Michael A. Indenbaum or National City Bank has, during the last five years, been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors). None of Kent B. Herrick, Michael A. Indenbaum or National City Bank has, during the last five years, been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. Pursuant to Rule 13d-4 under the Securities Exchange Act of 1934, each of Todd W. Herrick and Toni L. Herrick expressly declares that the filing of this Schedule 13D shall not be construed as an admission that he or she is a beneficial owner of any of the shares of Tecumseh covered by this Schedule 13D, for purposes of Section 13(d) or 13(g) of the Securities Exchange Act of 1934, except the 21,906 shares of Class B Stock referred to above as beneficially owned by Todd W. Herrick, and each of Todd W. Herrick and Toni L. Herrick expressly disclaims all beneficial ownership of any kind or character in, to, or with respect to, all or any of the balance of the Class B Stock referred to in this Schedule 13D. Todd W. Herrick has the sole power to vote or direct the vote and sole power to dispose or to direct the disposition of 21,906 shares of the outstanding Class B Common Stock. Todd W. Herrick has shared power to vote or direct the vote and to dispose or to direct the disposition of 2,193,538 shares of Class B Stock. Toni L. Herrick has shared power to vote or direct the vote and to dispose or to direct the disposition of 888,113 shares of Class B Stock. Each of Todd W. Herrick and Toni L. Herrick expressly disclaims that he or she or any one or more of the above named persons constitute a "group" within the meaning of Rule 13d-3 under the Securities Exchange Act of 1934. None of Todd W. Herrick, Toni L. Herrick, Herrick Foundation or the Trusts has engaged in any transactions in shares of Class B Stock in the past 60 days. Todd W. Herrick and Toni L. Herrick are filing this Schedule 13D solely to update this Schedule 13D. Herrick Foundation has the right to receive and the power to direct the receipt of dividends from, and the proceeds from the sale of, the 1,305,425 shares of Class B Stock owned by Herrick Foundation. The beneficiaries of the Trusts have the right to receive dividends on shares of Class B Stock held in those trusts and the right to receive the proceeds from any sale of those securities. The beneficiaries of the Trusts are Todd W. Herrick, his sister, Toni L. Herrick, and their descendants. Page 9 of 11 pages ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER. Other than those relationships with other members of the Board of Trustees of Herrick Foundation and the other trustees of the Trusts, Todd W. Herrick's oversight responsibilities for Herrick Foundation and Todd W. Herrick's and Toni L. Herrick's responsibilities for the Trusts, which are necessarily shared with the other trustees, those responsibilities that arise from Todd W. Herrick's position as Chairman Emeritus of Tecumseh, options granted to Tricap Partners LLC, described in amendment no. 1 to this Schedule 13D, and the Settlement Agreement, described in Item 4 above and attached as Exhibit 99.2, neither Todd W. Herrick nor Toni L. Herrick has any contracts, arrangements, understandings or relationships (legal or otherwise) with any person with respect to any Class B Stock or any other securities of Tecumseh, including, but not limited to, transfer or voting of any of the securities, finder's fees, joint ventures, loan or option agreements, puts or calls, guarantees of profits or loss, division or profits or loss, or the giving or withholding of proxies. ITEM 7. MATERIAL TO BE FILED AS EXHIBITS. 99.1 Agreement of Joint Filing among the Reporting Persons, dated as of February 22, 2007, incorporated by reference to Exhibit 99.1 to Amendment No. 2 to this Schedule 13D, dated August 12, 2004 and filed February 23, 2007. 99.2 Settlement and Release Agreement, dated as of April 1, 2007, among Tecumseh Products Company, Herrick Foundation, Todd W. Herrick, Toni Herrick, Kent B. Herrick, Michael Indenbaum, Albert A. Koch, Peter Banks and David M. Risley. SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. Dated: April 11, 2007 /s/ TODD W. HERRICK ---------------------------------------- Todd W. Herrick Dated: April 11, 2007 /s/ TONI L. HERRICK ---------------------------------------- Toni L. Herrick Page 10 of 11 pages EXHIBIT INDEX Exhibit Number and Description 99.1 Agreement of Joint Filing among the Reporting Persons, dated as of February 22, 2007, incorporated by reference to Exhibit 99.1 to Amendment No. 2 to this Schedule 13D, dated August 12, 2004 and filed February 23, 2007. 99.2 Settlement and Release Agreement, dated as of April 1, 2007, among Tecumseh Products Company, Herrick Foundation, Todd W. Herrick, Toni Herrick, Kent B. Herrick, Michael Indenbaum, Albert A. Koch, Peter Banks and David M. Risley. Page 11 of 11 pages EX-99.2 2 k14075a1exv99w2.txt SETTLEMENT AND RELEASE AGREEMENT, DATED APRIL 1, 2007 SETTLEMENT AND RELEASE AGREEMENT This SETTLEMENT AND RELEASE AGREEMENT (the "SETTLEMENT AGREEMENT") is made and entered into as of April 2, 2007, by and among: (i) Tecumseh Products Company, a Michigan corporation (the "COMPANY"); (ii) Herrick Foundation, a Michigan nonprofit corporation, Todd W. Herrick and Toni Herrick, each in their capacity as trustee for the Ray W. Herrick and Hazel M. Herrick Trusts u/a/d February 26, 1949 and February 24, 1956 f/b/o Todd W. Herrick and his descendants and Ray W. Herrick and Hazel M. Herrick Trusts u/a/d February 26, 1949 and February 24, 1956 f/b/o Toni Herrick and her descendants (the "Herrick Trusts"), Todd W. Herrick, Kent B. Herrick and Michael Indenbaum, each in their capacity as members of the Board of Trustees of Herrick Foundation, Todd W. Herrick, Kent B. Herrick, Michael Indenbaum, and Toni Herrick, each in their individual capacities (collectively referred to herein as the "HERRICK ENTITIES"); and (iii) Albert A. Koch, Peter Banks, and David M. Risley, each in their capacity as directors of the Company and collectively referred to herein as the "DEFENDANT DIRECTORS." The Company, the Herrick Entities and the Defendant Directors, and any subsequent Person that becomes a party hereto in accordance with the terms hereof, are each referred to herein as a "PARTY," and collectively, the "PARTIES." WITNESSETH: WHEREAS AlixPartners, LLP, through its affiliate AP Services, LLC ("ALIXPARTNERS") is currently engaged to work on a turnaround plan for the Company; WHEREAS James Bonsall has been appointed interim President and Chief Operating Officer ("COO") of the Company pending selection of a Chief Executive Officer (the "CEO"), the hiring of a CEO being a condition required by that certain Amended And Restated Second Lien Credit Agreement, dated as of November 13, 2006 (as the same has heretofore been amended and as it may be further amended, supplemented or otherwise modified from time to time, the "SECOND LIEN CREDIT AGREEMENT") among the Company, Tricap Partners, LLC, as Lender (the "SECOND LIEN LENDER"), Tricap Partners II L.P. as Administrative Agent (the "SECOND LIEN ADMINISTRATIVE AGENT") and Citicorp USA, Inc., as Collateral Agent for the Secured Parties; WHEREAS, on March 6, 2007, Herrick Foundation and Todd Herrick commenced an action against the Company and the Defendant Directors in the Circuit Court for the County of Lenawee, State of Michigan, Case No. 07-2525-CZ (the "STATE COURT ACTION"), requesting that the court declare as void and of no force or effect resolutions passed by the Board of Directors of the Company (the "BOARD") on February 28, 2007 increasing the size of the Board to seven members, amending the Company's bylaws, and removing Todd Herrick as Chairman of the Board, but having him remain as a Board member; WHEREAS, on March 15, 2007, the Company commenced an action against each of the Herrick Entities in the United States District Court for the Eastern District of Michigan, Case No. 2:07-cv-11144 (the "FEDERAL ACTION," and together with the State Court Action, the "GOVERNANCE LAWSUITS") requesting that the court declare certain shareholder voting rights of Herrick Foundation, the Herrick Trusts and Todd Herrick suspended, and enjoin the Herrick Entities from exercising those rights; WHEREAS, the Company, the Herrick Entities and the Defendant Directors have agreed to fully and finally settle all their disputes and claims with respect to the Governance Lawsuits, as set forth in this Settlement Agreement, which global settlement will be effected in the manner and subject to the conditions set forth herein; and WHEREAS, this Settlement Agreement is being executed in connection with (i) Amendment No. 5 (the "FIRST LIEN AMENDMENT") to that certain First Lien Credit Agreement, dated as of February 6, 2006 (as the same has heretofore been amended and as it may be further amended, supplemented or otherwise modified from time to time, the "FIRST LIEN CREDIT AGREEMENT"), among the Company, the financial institutions from time to time a party thereto as lenders (the "FIRST LIEN LENDER"), the financial institutions from time to time a party thereto as issuing banks (the "ISSUERS") and Citicorp USA, Inc., as administrative agent and collateral agent for the First Lien Lenders and the Issuers (in such capacities, the "FIRST LIEN ADMINISTRATIVE AGENT"), and (ii) Amendment No. 2 to the Second Lien Credit Agreement (the "SECOND LIEN AMENDMENT" and together with the First Lien Amendment, the "AMENDMENTS"), and it is a condition precedent to the effectiveness of each of the First Lien Amendment and the Second Lien Amendment that this Settlement Agreement be executed and delivered to the First Lien Administrative Agent and the Second Lien Administrative Agent, respectively; WHEREAS, the First Lien Lender, the First Lien Administrative Agent, the Second Lien Lender, and the Second Lien Administrative Agent (collectively, the "LENDER PARTIES"), have agreed to provide the Amendments for the benefit of the Company and its shareholders; WHEREAS, each of the Parties recognizes and is aware that a breach of this Settlement Agreement during the term of the First Lien Credit Agreement and the Second Lien Credit Agreement will constitute an "Event of Default" under each of the First Lien Credit Agreement and the Second Lien Credit Agreement; WHEREAS, each of the Parties has reviewed, or has had the opportunity to review, this Settlement Agreement with the assistance of their respective legal and financial advisors of their own choosing. NOW, THEREFORE, in consideration of the premises and mutual covenants and agreements set forth herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows: Section 1. Composition of the Board. (a) Resignation of Todd Herrick. Upon execution of this Settlement Agreement, Todd Herrick will immediately resign from his current position as a member of the Board, and the Company and the Defendant Directors will cause the Company's Board of Directors to appoint Todd Herrick as "Chairman Emeritus" during the term of this Settlement Agreement, subject to his earlier death or resignation, with Board observer rights, including the right (but not the obligation) to attend and participate in all meetings of the Company's Board of Directors (but not the right to vote at any such meeting) and the right to receive all notices of Board and Board committee meetings and a copy of all materials provided to any Board member (other than materials provided to members of standing committees in existence as of the date of this Settlement Agreement and as to which Todd Herrick does not have observer rights) concurrently with the provision of the same to any Board member and in the same manner as provided to such Board member. 2 (b) Initial Five Member Board. The Board will initially be comprised of five members, as follows: (i) Messrs Risley, Banks and Kevin Sheehan will remain as independent directors. (ii) Kent Herrick will replace Todd Herrick as a member of the Board and shall be nominated and recommended by the Company for election as a director of the Company during the term of this Settlement Agreement (including, without limitation, at the 2007 Annual Meeting of Shareholders), subject only to his earlier death or resignation. (iii) Upon the execution of this Settlement Agreement, a search committee will be charged with immediately locating a director with restructuring experience reasonably acceptable to the independent members of the Board and who is not affiliated with AlixPartners. Upon the earliest of (1) 60 days following the appointment of the CEO, but in no event later than 120 days after the date of this Settlement Agreement, and (2) such time as a replacement director with restructuring experience and who is not affiliated with AlixPartners is appointed, Albert Koch will resign from his current position as a member of the Board and of all Board committees of which he is a member and from all other positions he holds with the Company or any of its Subsidiaries; provided, however, that Mr. Koch's director position must eventually be filled by a director with restructuring experience who is reasonably acceptable to the independent directors of the Board and in accordance with the Company's bylaws. (iv) Each Board member shall have the right to attend and participate in all meetings of the Company's Board of Directors and the right to receive all notices of Board and Board committee meetings and a copy of all materials provided to any Board member (other than materials provided to members of standing committees in existence as of the date of this Settlement Agreement as to which the receiving Board member is not a member) concurrently with the provision of the same to any Board member and in the same manner as provided to such Board member. (c) Expansion to Seven Member Board. Upon the hiring of a CEO, the Board will expand and be comprised of two additional members, for a total of seven members, for the term of this Settlement Agreement, as follows: (i) The CEO will be appointed to the Board and will become the Chairman of the Board. (ii) So long as, at the time of his appointment, Steven Lebowski qualifies as an "independent" director, Steven Lebowski will be appointed to the Board and shall be nominated and recommended by the Company for election as a director of the Company during 3 the term of this Settlement Agreement, subject only to his earlier death or resignation. The Company and the Defendant Directors acknowledge that, based on materials provided to date in support of Steven Lebowski's nomination to the Board, they are not aware of any facts and circumstances that would lead them to conclude that Mr. Lebowski is not "independent." The Parties agree, however, that between the date hereof and the time of his proposed appointment, Mr. Lebowski will meet with the members of the Board and provide any additional materials the Board reasonably requests. If, after receiving the requested information, the Board is unable to determine Mr. Lebowski's independence, the Parties agree to defer the matter to mutually acceptable counsel and, so long as an opinion of reputable counsel is delivered to the Company stating that it would be reasonable for the Board to conclude that Mr. Lebowski is independent, he shall be appointed to the Board. If Steven Lebowski is not determined to be "independent," Kent Herrick will propose two nominees to fill the seventh Board seat. The independent directors will select one of the proposed nominees, whose independence shall be determined in accordance with the protocol described in this paragraph. In the event such nominee is determined not to be independent, the nomination and independence determination process set forth in this paragraph recommences until such time as a candidate is appointed. (d) Conduct of Board Business. For the term of this Settlement Agreement all of the Company's business and affairs conducted by members of the Board of Directors as directors of the Company shall be conducted at meetings of the Board of Directors (or actions by unanimous written consent in lieu of such meetings), except for (i) business conducted through the standing committees of the Board of Directors in existence as of the date of this Settlement Agreement and consistent with their authority as of the date of this Settlement Agreement or (ii) business conducted by committees hereafter created upon unanimous Board approval (collectively, the "Permitted Committees"). For purposes of this provision, any committee appointed pursuant to section 1(b)(iii) of this Settlement Agreement (for the purpose of finding a replacement director with restructuring experience) shall be created by a majority vote of the Board of Directors and shall be included in the definition of Permitted Committees. Section 2. Management Roles. (a) CEO. The search for a CEO will continue and all information relating to potential candidates will be shared with all members of the Board. The selection of a CEO will be decided by a vote of the full five member Board as set forth in Section 1(b) hereto; provided, however, that the provisions of this Section 2(a) shall not be deemed to amend or otherwise alter the provisions of Section 7.14 of the Second Lien Credit Agreement. James Bonsall shall not be the CEO. 4 (b) AlixPartners. Mr. Bonsall will remain interim President and COO of the Company, and AlixPartners will continue to provide turnaround services to the Company, at the discretion of the Company's Board of Directors until such time as the CEO has been transitioned. Thereafter, the continued provision of services by Mr. Bonsall and AlixPartners to the Company, if any, will be subject to the discretion of the Company's Board of Directors and shall be conducted at the discretion of the CEO subject to the terms of the Company's agreement with AlixPartners. (c) Todd Herrick. The Parties agree that Todd Herrick will serve as a consultant to the Company in such capacity as to be determined by the new CEO, as applicable; provided, however, that Mr. Herrick will not be compensated for such consulting services, but will be entitled to reimbursement of all reasonable and documented expenses incurred in providing such services. (d) Kent Herrick. The Parties agree that the determination to rehire Kent Herrick and the capacity of such hiring will be decided by the CEO. If Kent Herrick is rehired, he will receive an agreement to provide him with a lump sum severance upon termination equal to one year's salary less any salary paid to him from the date he is rehired through the date of his termination, payable on termination. If the CEO has not hired Kent Herrick within three months of his appointment, Kent Herrick will be entitled to a lump sum severance payment equal to one year's salary as was in effect immediately prior to his January 19, 2007 termination date. Section 3. Dismissal of Governance Lawsuits. Immediately upon execution of this Settlement Agreement, the Company, the Director Defendants, Todd Herrick, Herrick Foundation, and the other Herrick Entities will dismiss, with prejudice, the Governance Lawsuits; provided, however, that nothing herein shall in any way limit the rights of any third parties, including shareholders, that are not parties to this Settlement Agreement. The Company and the Director Defendants acknowledge and agree that the Herrick Entities have the right to vote all of their voting shares in the Company with respect to all matters subject to a vote of shareholders of the Company. The Company and the Director Defendants agree not to claim or assert, or aid, assist or encourage any other person in claiming or asserting, based upon actions or events occurring on or before the date of this Settlement Agreement or based upon the existence, execution, delivery or performance of this Settlement Agreement, that any of the Herrick Entities' shares are not entitled to vote all or any part of their voting shares in the Company with respect to any or all matters subject to a vote of shareholders of the Company; provided, however, that such agreement shall in no way limit or in any way constitute a determination of the rights of any third parties, including shareholders, that are not parties to this Settlement Agreement. During the term of this Settlement Agreement, the Company and the Director Defendants agree not to take any action that is inconsistent with the terms of this Settlement Agreement. During the term of this Settlement Agreement, the Herrick Entities agree to vote for the slate of directors provided for herein in order to effectuate the terms of this Settlement Agreement. Section 4. Herrick Entities' Attorneys' Fees. The Company hereby agrees to pay the reasonable and documented attorneys' fees and other fees and expenses incurred by any of the Herrick Entities in connection with executing, delivering and performing this Settlement Agreement, pursuing any actions or proceedings related hereto and any nominations or notices of nominations of directors for election at the 2007 Annual Meeting of Shareholders, including the Governance Lawsuits, or consummating the transactions contemplated hereby; provided, however, that the total amount of attorneys' fees payable 5 under this Section 4 shall not exceed $300,000. Simultaneously with the execution of this Settlement Agreement, the Company shall pay its reasonable and documented outstanding invoices to Honigman Miller Schwartz and Cohn; provided, however, that the total amount of attorneys' fees payable under this Section 4 shall not exceed $90,000. Section 5. Covenant to Vote. During the term of this Settlement Agreement, the Herrick Entities and the Defendant Directors agree to exercise all of their respective voting rights in a manner consistent with the terms and conditions set forth in this Settlement Agreement. Section 6. Release of the Herrick Entities by the Company and the Director Defendants. Upon and following the resignation of Todd Herrick provided for in Section 1 hereto, and except with respect to the obligations expressly contained in this Settlement Agreement, each of the Director Defendants and the Company and, where appropriate, each of their respective directors, officers, managers, members, trustees, agents, employees, partners, shareholders, subsidiaries, successors, assigns, and other affiliates hereby release each of the Herrick Entities from any and all claims, demands, rights, actions or causes of action, liabilities, damages, losses, obligations, judgments, suits, matters, indemnification claims, any claim arising out of issues of any kind or nature whatsoever, known or unknown, contingent or absolute, suspected or unsuspected, disclosed or undisclosed, hidden or concealed, matured or unmatured, with respect to, and in connection with, the matters specifically referenced in this Settlement Agreement, including, without limitation, the Amendments. Section 7. Release of the Defendant Directors by the Company and the Herrick Entities. Immediately upon execution of this Settlement Agreement, and except with respect to the obligations expressly contained in this Settlement Agreement, each of the Herrick Entities and the Company, and, where appropriate, each of their respective directors, officers, managers, members, trustees, agents, employees, partners, shareholders, subsidiaries, successors, assigns, and other affiliates hereby release the Defendant Directors from any and all claims, demands, rights, actions or causes of action, liabilities, damages, losses, obligations, judgments, suits, matters, indemnification claims, any claim arising out of issues of any kind or nature whatsoever, known or unknown, contingent or absolute, suspected or unsuspected, disclosed or undisclosed, hidden or concealed, matured or unmatured, with respect to, and in connection with, the matters specifically referenced in this Settlement Agreement, including, without limitation, the Amendments. Section 8. Release of the Lender Parties by the Company and the Herrick Entities. In consideration for their willingness and agreement to enter into the Amendments for the benefit of the Company and its shareholders, each of the Herrick Entities and the Company, and, where appropriate, each of their respective directors, officers, managers, members, trsutees, agents, employees, partners, shareholders, subsidiaries, successors, assigns, and other affiliates hereby release the Lender Parties from any and all claims, demands, rights, actions or causes of action, liabilities, damages, losses, obligations, judgments, suits, matters, indemnification claims, any claim arising out of issues of any kind or nature whatsoever, known or unknown, contingent or absolute, suspected or unsuspected, disclosed or undisclosed, hidden or concealed, matured or unmatured, with respect to, and in connection with, the matters specifically referenced in this Settlement Agreement. Section 9. Covenant Not to Sue. Each of the releasing parties in Section 6, Section 7 and Section 8 agrees not to assert or bring any claim that is released in any of those 6 sections, and, in addition to any other remedy available to the released parties, agrees to pay all liabilities, losses and expenses (including, without limitation, attorneys' fees and costs of investigation) incurred by any released party as a result of any breach of this Section 9. Section 10. Non-Disparagement. Upon execution of this Settlement Agreement, throughout the term of this Settlement Agreement, and for 12 months thereafter, the Parties shall not make any disparaging statements in a public forum or to the media concerning the Company, its officers, directors, employees, attorneys, agents, or contracting parties, or its business or operations; provided, however, that this non-disparagement agreement shall not in any way prevent the Parties from disclosing any information to their attorneys or in response to a lawful subpoena or court order requiring disclosure of information; provided, further, however, that this non-disparagement agreement shall not in any way restrict the Parties or their agents in their statements to other directors or at meetings of the Company's Board of Directors, during their membership on the board. Section 11. Term. This Settlement Agreement shall terminate at the earlier of the conclusion of the 2008 Annual Shareholders Meeting and April 30, 2008; provided, however, that any provisions of this Settlement Agreement intended to survive such termination shall be binding on the Parties thereafter. Section 12. Condition Subsequent. It shall be a condition subsequent to the effectiveness of this Settlement Agreement that the Amendments are executed and delivered to the Company within ten business days of the date of this Agreement. Section 13. Governing Law; Jurisdiction. This Settlement Agreement shall be governed by, and construed in accordance with, the laws of the State of Michigan, regardless of the laws that might otherwise govern under applicable principles of conflict of laws of the State of Michigan. By execution and delivery of this Settlement Agreement, each of the Parties hereto hereby irrevocably and unconditionally agrees for itself that any legal action, suit or proceeding against it with respect to any matter under or arising out of or in connection with this Settlement Agreement or for recognition or enforcement of any judgment rendered in any such action, suit or proceeding, shall be brought in a federal court of competent jurisdiction in the United States District Court for the Eastern District of Michigan, if such court has subject matter jurisdiction. By execution and delivery of this Settlement Agreement, each of the Parties hereto hereby irrevocably accepts and submits to the nonexclusive jurisdiction of such courts, generally and unconditionally, with respect to any such action, suit or proceeding. Section 14. Notices. All demands, notices, requests, consents and communications hereunder shall be in writing and shall be deemed to have been duly given if delivered personally or by courier service, messenger, facsimile or, if duly deposited in the mails, by certified or registered mail, postage prepaid-return receipt requested, and shall be deemed to have been duly given or made: (a) upon delivery, if delivered personally or by courier service or messenger, in each case with record of receipt; (b) upon transmission with confirmed delivery, if sent by facsimile or telecopy; or (c) when received after being sent by certified or registered mail, postage pre-paid, return receipt requested, to the following addresses or such other addresses as may be furnished hereafter by notice in writing, to the following Parties: 7 IF TO THE COMPANY: Attn: President and Chief Operating Officer Tecumseh Products Company 100 E. Patterson St. Tecumseh MI 49286 Facsimile: (517) 423-8619 with copies to: Attn: Paul M. Basta Kirkland & Ellis, LLP 153 E. 53rd Street New York, NY 10022-4611 Facsimile: 212-446-4900 IF TO THE HERRICK ENTITIES: Todd W. Herrick 261 Wildwood Circle Tecumseh, MI 49286-8706 Herrick Foundation c/o Michael Indenbaum c/o Honigman Miller Schwartz & Cohn LLP 2290 First National Building 660 Woodward Avenue Detroit, Michigan 48226-3506 Facsimile: 313.465.7633 Herrick Trusts c/o Michael Indenbaum c/o Honigman Miller Schwartz & Cohn LLP 2290 First National Building 660 Woodward Avenue Detroit, Michigan 48226-3506 Facsimile: 313.465.7633 Toni Herrick 7028 Foxmoor Court E. P.O. Box 19555 Kalamazoo, MI 49009 Kent Herrick 9693 Woodbend Saline, MI 48176 Michael Indenbaum c/o Honigman Miller Schwartz & Cohn LLP 8 2290 First National Building 660 Woodward Avenue Detroit, Michigan 48226-3506 Facsimile: 313.465.7633 in each case with copies to: Attn: Todd R. Mendel Barris, Sott, Denn & Driker, P.L.L.C. 211 West Fort Street, 15th Floor Detroit, MI 48226-3281 Facsimile: 313-965-2493 IF TO THE DEFENDANT DIRECTORS: Attn: Albert A. Koch c/o Alix Partners, LLC 2000 Town Center Southfield, MI 48075 Facsimile: 248-262-8491 Attn: Peter M. Banks 5602 Newanga Avenue Santa Rosa, CA 95405 Attn: David M. Risley 2710 Derby Road Ottowa Hills, OH 43615 in each case with copies to: Attn: Richard A. Chesley Paul Hastings Janofsky & Walker LLP 191 North Wacker Drive, 30th Floor Chicago, IL 60606 Facsimile: (312) 499-6150 Section 15. Entire Agreement. This Settlement Agreement constitutes the full and entire understanding and agreement among the Parties with regard to the subject matter hereof and supersedes all prior agreements with respect to the subject matter hereof. Section 16. Headings. The headings of the paragraphs and subparagraphs of this Settlement Agreement are inserted for convenience only and shall not affect the interpretation hereof. Section 17. Successors and Assigns. This Settlement Agreement is intended to bind and inure to the benefit of the Parties and their respective permitted successors and assigns. 9 Section 18. Covenant Not to Assign. The Parties hereby agree that no Party may assign, directly or indirectly, all or part of its rights or obligations under this Settlement Agreement without the prior written consent of each Party, which consent shall not be unreasonably withheld or delayed. Section 19. Specific Performance. Each Party hereto recognizes and acknowledges that a breach by it of any covenants or agreements contained in this Settlement Agreement will cause the other Parties to sustain damages for which such other Parties would not have an adequate remedy at law for money damages and, therefore, each Party hereto agrees that, in the event of any such breach, such other parties shall be entitled to the remedy of specific performance of such covenants and agreements and injunctive and other equitable relief in addition to any other remedy to which such parties may be entitled at law or in equity. Section 20. Remedies Cumulative. All rights, powers and remedies provided under this Settlement Agreement or otherwise available in respect hereof at law or in equity shall be cumulative and not alternative, and the exercise of any right, power or remedy thereof by any party shall not preclude the simultaneous or later exercise of any other such right, power or remedy by such party. Nothing herein shall impact the rights heretofore existing, if any, of Todd Herrick or Kent Herrick to receive pension and other benefits as a result of his prior employment with the Company, its subsidiaries or both. Moreover, nothing herein shall prohibit the Company, including any and all successors in interest, from asserting any defenses, objections or any other rights it may have with respect to any claim by Todd Herrick or Kent Herrick to receive such pension and other benefits. The Company and the Director Defendants are not presently aware of any defenses, objections or any other rights the Company may have with respect to any claim by Todd Herrick or Kent Herrick to receive such pension and other benefits. Section 21. No Waiver. The failure of any Party hereto to exercise any right, power or remedy provided under this Settlement Agreement or otherwise available in respect hereof at law or in equity, or to insist upon compliance by any other Party hereto with its obligations hereunder, and any custom or practice of the parties at variance with the terms hereof, shall not constitute a waiver by such Party of its right to exercise any such or other right, power or remedy or to demand such compliance. Section 22. Counterparts. This Settlement Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which shall constitute one and the same Settlement Agreement. Delivery of an executed signature page of this Settlement Agreement by facsimile or email shall be as effective as delivery of a manually executed signature page of this Settlement Agreement. Section 23. Severability. Any provision of this Settlement Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof or affecting the validity or enforceability of such provision in any other jurisdiction and any such prohibited or unenforceable provision shall be deemed reformed and construed so that it will be valid, legal and enforceable and not prohibited to the maximum extent permitted by applicable law. 10 Section 24. Third-Party Beneficiaries. Unless expressly stated herein, this Settlement Agreement shall be solely for the benefit of the Parties and no other person or entity shall be a third party beneficiary hereof. Section 25. Settlement Discussions. This Settlement Agreement is part of a proposed settlement of a dispute among the Parties. Nothing herein shall be deemed an admission of any kind. Pursuant to Federal Rule of Evidence 408 and any applicable state rules of evidence, this Settlement Agreement and all negotiations relating thereto shall not be admissible into evidence in any proceeding other than a proceeding to enforce the terms of this Settlement Agreement. Section 26. Consideration. It is hereby acknowledged by the Parties hereto that, other than the agreements, covenants, representations and warranties set forth herein, no consideration shall be due or paid to any Party for its entry into this Settlement Agreement. Section 27. Receipt of Adequate Information; Representation by Counsel. Each Party acknowledges that it has received adequate information to enter into this Settlement Agreement and that it has been represented by counsel in connection with this Settlement Agreement and the transactions contemplated by this Settlement Agreement. Accordingly, any rule of law or any legal decision that would provide any party with a defense to the enforcement of the terms of this Settlement Agreement against such party shall have no application and is expressly waived. The provisions of the Settlement Agreement shall be interpreted in a reasonable manner to effect the intent of the Parties. Section 28. Time of the Essence. Time is of the essence with respect to all provisions of this Settlement Agreement that specify a time for performance. [SIGNATURE PAGES FOLLOW] 11 IN WITNESS WHEREOF, the Parties hereto have duly executed and delivered this Settlement Agreement as of the date first above written. TECUMSEH PRODUCTS COMPANY By: /s/ JAMES BONSALL ------------------------------------ Name: James Bonsall Title: President & Chief Operating Officer 12 IN WITNESS WHEREOF, the Parties hereto have duly executed and delivered this Settlement Agreement as of the date first above written. HERRICK FOUNDATION By: /s/ TODD W. HERRICK ------------------------------------ Name: Todd W. Herrick Title: Chairman TODD W. HERRICK, INDIVIDUALLY, AS TRUSTEE FOR THE HERRICK TRUSTS AND AS A MEMBER OF THE BOARD OF TRUSTEES OF HERRICK FOUNDATION /s/ TODD W. HERRICK ------------------------------------ TONI HERRICK, INDIVIDUALLY AND AS TRUSTEE FOR THE HERRICK TRUSTS /s/ TONI L. HERRICK ------------------------------------ KENT B. HERRICK, INDIVIDUALLY AND AS A MEMBER OF THE BOARD OF TRUSTEES OF HERRICK FOUNDATION /s/ KENT B. HERRICK ------------------------------------ MICHAEL INDENBAUM /s/ MICHAEL INDENBAUM ------------------------------------ IN WITNESS WHEREOF, the Parties hereto have duly executed and delivered this Settlement Agreement as of the date first above written. ALBERT A. KOCH By: /s/ ALBERT KOCH -------------------------------- PETER BANKS By: /s/ PETER BANKS -------------------------------- DAVID M. RISLEY By: /s/DAVID M. RISLEY -------------------------------- -----END PRIVACY-ENHANCED MESSAGE-----