EXHIBIT 10.1
SEVERANCE AGREEMENT AND RELEASE
1. This Severance Agreement and Release ("Agreement") is made between Xxxx
X. Xxxxxx ("Executive") and Xxxxxxxx & Company ("Xxxxxxxx").
2. Executive's employment as Chief Financial Officer of Xxxxxxxx ended
effective May 2, 2006. Xxxxxxxx acknowledges Executive's many valuable
contributions to Xxxxxxxx over his career.
CONSIDERATION
3. In return for the promises and covenants made by Executive in this
Agreement, Xxxxxxxx will provide Executive with the following:
(a) Xxxxxxxx will pay to Executive the total amount of $378,196.10
(three hundred seventy-eight thousand one hundred ninety-six
dollars and ten cents). This total amount will be split into
bi-monthly equal monthly payments, paid to Executive over
the period of 12 months (the "Severance Period") following
the Effective Date, as defined below in paragraph 24 of this
Agreement. If Executive dies during the Severance Period,
any monthly payments remaining after his death will be made
to his estate. Xxxxxxxx will issue a 1099 reflecting these
payments and Executive (and/or his estate, if applicable)
shall be liable for any and all taxes on the amount paid to
him (and/or his estate, if applicable) pursuant to this
Agreement.
(b) Xxxxxxxx will also pay to Executive $31,516.34 (thirty-one
thousand five hundred sixteen dollars and thirty-four cents)
per month ("Supplemental Severance") for up to 6 months
following the Severance Period if Executive is not employed at
the end of the Severance Period, provided, however, that
Xxxxxxxx'x obligation to pay Executive the full amount of the
Supplemental Severance pursuant to this subparagraph 3(b) will
immediately cease upon Executive becoming employed at any
point during the 6 months following the Severance Period.
Executive shall immediately notify Xxxxxxxx if he secures
employment at any point during the 6 months following the
Severance Period. Executive's obligations under this
Agreement, including, but not limited to, paragraphs 8, 9, 12,
13, and 14, shall continue while he receives payment pursuant
to this subparagraph 3(b).
(c) During the Severance Period, Xxxxxxxx will permit Executive to
continue to hold and exercise stock options for 90 days in
accordance with the provisions of the applicable stock option
agreements.
(d) Executive shall be entitled to continue insurance coverage to
the extent that Xxxxxxxx is required by law (the Consolidated
Omnibus Budget Reconciliation Act of 1985, as amended) to
provide such coverage ("COBRA coverage") for him and/or his
dependents. If Executive elects COBRA coverage, Xxxxxxxx will
pay the premiums for such COBRA coverage for the lesser of 12
months or until Executive becomes eligible for other
comparable insurance coverage through a subsequent employer.
If it is not feasible (for legal or contractual reasons) for
Xxxxxxxx to pay those premiums directly to the applicable
insurance provider(s), Xxxxxxxx will pay to Executive a
monthly sum
(in addition to the payment described in subparagraph 3(a)),
for the lesser of 12 months or until Executive becomes
eligible for other comparable insurance coverage through a
subsequent employer, equal to the amount of Executive's
monthly COBRA coverage premium.
(e) During the Severance Period, Xxxxxxxx will continue to pay the
premiums on the $50,000 basic and $100,000 supplemental life
insurance policies that Xxxxxxxx provided for Executive during
his employment and that were in force at the end of his
employment, if the terms of the applicable benefit plan(s) and
policies and applicable laws permit the continuation of said
life insurance and permit Xxxxxxxx to continue paying the
premiums during the Severance Period. If payment of such
premiums by Xxxxxxxx would violate plan or policy terms or
applicable laws or would otherwise not be feasible for legal
or contractual reasons, Xxxxxxxx will pay to Executive a
monthly sum during the Severance Period (in addition to the
payment described in subparagraph 3(a) and 3(b)) equal to the
amount of monthly premiums for said life insurance (if
applicable plans and policies permit continuation of said life
insurance after Executive's employment).
(f) Xxxxxxxx will transfer Executive's company car to him free and
clear of all liens, loans and debt (whether through a lease or
otherwise). Executive will pay any transfer taxes, as well as
any taxes that are due after the Effective Date hereof.
Xxxxxxxx will withhold any taxes attributable to the transfer
of Executive's company car from the payment described in
subparagraph 3(a). If Executive is unable or unwilling to
retain his company car by the methods described above,
Executive shall be required to return the company car to
Xxxxxxxx no later than ten days after the Effective Date
hereof.
(g) Xxxxxxxx will pay for Executive to receive, for a period not
to exceed 6 months after the Effective Date of this Agreement,
the outplacement services customarily provided by the Mulling
Companies.
(h) Except for existing contributions and vested rights, if any,
that Executive may have under Xxxxxxxx'x Deferred Compensation
Plan, Employee Stock Purchase Plan, Defined Benefit Plan,
Defined Contribution Plan (401k), and/or Supplemental
Executive Retirement Plan, Executive shall receive no
compensation or benefit from Xxxxxxxx (including no additional
contribution or payment to the plans listed in this paragraph)
after the Effective Date of this Agreement, other than as
expressly provided for herein.
(i) Xxxxxxxx agrees that, in lieu of any annual contribution of
Executive's base salary to Executive's Defined contribution
Plan (401k), Xxxxxxxx will pay to Executive a lump sum in the
amount of $18,909.80 within 10 calendar days of the Effective
Date of this Agreement.
(j) Xxxxxxxx agrees that it will pay those attorneys' fees and
expenses that Executive incurred in negotiating this Agreement
up to Three Thousand Dollars and no cents ($3,000.00).
Executive agrees and covenants that he will submit an
Affidavit attesting to the amount of such fees and expenses he
has incurred and he solely is responsible for any amount above
Three Thousand Dollars ($3,000.00). Xxxxxxxx agrees that,
within 10 calendar days of receipt of Executive's Affidavit,
it will pay the amount attested to by Executive in the
Affidavit.
RELEASE OF CLAIMS
4. Executive hereby irrevocably and unconditionally releases, acquits, and
forever discharges Xxxxxxxx and each of Xxxxxxxx'x former and current
owners, stockholders, predecessors, successors, assigns, agents,
directors, officers, employees, representatives, attorneys, parent
companies, divisions, subsidiaries, affiliates (and agents, directors,
officers, employees, representatives, and attorneys of such parent
companies, divisions, subsidiaries, and affiliates), and all persons
acting by, through, under, or in concert with any of them (collectively
"Releasees"), from any and all charges, complaints, claims,
liabilities, obligations, promises, agreements, controversies, damages,
actions, causes of
action, suits, rights, demands, costs, losses, debts, and expenses
(including attorneys' fees and costs) of any nature whatsoever, known
or unknown, suspected or unsuspected, which Executive now has, owns, or
holds; claims to have, own, or hold; at any time heretofore had, owned,
or held; or at any time heretofore claimed to have, own, or hold,
against each or any of the Releasees based on actions of the Releasees
or Executive arising out of Executive's employment with Xxxxxxxx
("Claim" or "Claims"). The Claims released herein include, but are not
limited to, any claims for back pay, front pay, wages, compensatory
damages, punitive damages, benefits, severance, vacation pay, sick pay,
bonus, or any other form of compensation from the Releasees or any of
them, that arise under any federal, state, foreign, and/or local laws
including, but not limited to, (a) the Age Discrimination in Employment
Act of 1967, as amended; (b) Title VII of the Civil Rights Act of 1964,
as amended; (c) 42 U.S.C. Section 1981; (d) the Americans with
Disabilities Act; (e) the Equal Pay Act; (f) the Family and Medical
Leave Act; (g) the Rehabilitation Act of 1973; (h) the Fair Labor
Standards Act; (i) the Employee Retirement Income Security Act; (j)
statutory or common law relating to defamation, intentional infliction
of emotional distress, negligence of any kind, any other tort, or any
legal restriction on Xxxxxxxx'x right to terminate employees; (k)
statutory or common law relating to breach of an express or implied
contract; (l) statutory or common law relating to a breach of any
implied or express covenant of good faith and fair dealing; and/or (m)
statutory or common law relating to retaliation of any kind. Nothing in
this release of claims shall prevent Executive from bringing a claim or
claims to enforce the terms of this Agreement. This release of claims
does not constitute a waiver of Executive's right to employee benefits
that are vested, under the terms of applicable benefit, retirement, or
pension plans, as of the date this Agreement is signed. This release of
claims does not apply to claims, if any, as to which releases are
prohibited by applicable law or that arise after the Effective Date of
this Agreement.
5. As a material inducement to enter into this Agreement, and
without limiting the previous paragraph, Executive and his family agree
to release Xxxxxxxx, its employees, officers, directors, subsidiaries,
affiliated corporations, successors, and assigns from any and all
claims, liabilities, damages, actions, causes of action, suits,
demands, costs, and expenses of any kind whatsoever, whether known or
unknown, which Executive may have now, arising any time before the
Effective Date of this Agreement, that in any way are based upon,
related to, or derived from Executive or Executive's family being a
shareholder of Xxxxxxxx. Further, Executive agrees not to encourage,
persuade, or advocate that any third party engage in any action, suit,
demand, or claim against Xxxxxxxx, its employees, officers, directors,
subsidiaries, affiliated corporations, successors, or assigns that are
based upon, relate to, or derived from that third party being a
shareholder of Xxxxxxxx.
6. Executive represents that he has neither filed nor assigned to others
the right to file any complaints, charges, or lawsuits against Xxxxxxxx
with any government agency or any court. Executive further warrants and
represents that he has not made or caused to be made any assignment,
purported assignment, transfer, or purported transfer of any right,
claim, demand, or cause of action covered by this Agreement, and that
he is the sole and absolute legal and equitable owner of all such
rights, claims, demands, and causes of action. Executive further
represents that he will not, at any time hereafter, file, assign to
others the right to file, or otherwise initiate or pursue any claims
against Xxxxxxxx that
arise from actions taken or events occurring up to and including the
Effective Date of this Agreement. Executive shall indemnify, defend,
and hold harmless Xxxxxxxx from and against any claims based upon or
arising in connection with any such assignment or transfer, or
purported assignment or transfer, of any claims or other matters
released herein.
Executive further agrees that he will not accept, recover, or receive
any back pay, damages, or any other form of relief pursued on his
behalf by any federal, state, or local government agency, any class, or
any other person or entity, arising from claims against Xxxxxxxx that
arose before the Effective Date of this Agreement.
EXECUTIVE'S OTHER PROMISES AND COVENANTS
7. Except to the extent specifically permitted by paragraph 3(f), above,
Executive will immediately return to Xxxxxxxx all Xxxxxxxx property
that is within Executive's possession or control.
8. Executive will, to the extent reasonably requested in writing,
cooperate with and provide information to Xxxxxxxx during the Severance
Period in any pending or future litigation or investigation in which
Xxxxxxxx is a party or involved and regarding which Executive, by
virtue of his association with Xxxxxxxx, has relevant knowledge or
information. Executive will, in any such litigation or investigation,
without the necessity of a subpoena, provide, in any jurisdiction in
which Xxxxxxxx requests, truthful testimony relevant to said litigation
or investigation, except that for any jurisdiction outside of Georgia,
Executive, at his own discretion, shall decide if he wishes to give
such testimony through telephonic or videographic means. Executive will
also meet with Xxxxxxxx personnel and/or counsel regarding such
litigation or investigation to the extent reasonably requested in
writing, provided that Executive may participate in such meetings by
telephone if meeting in person would interfere or conflict with his
employment, business or personal obligations. Executive understands
that Xxxxxxxx will reimburse him for reasonable expenses actually
incurred when meeting his obligations under this paragraph, but will
not pay him an hourly rate or other fee for the time he spends in
meeting those obligations.
9. Executive will remain available by telephone during the Severance
Period, on a reasonable basis that will not unduly interfere or
conflict with his employment, business or personal obligations, to
provide information to Xxxxxxxx regarding matters he worked on, persons
he dealt with, and other knowledge he gained in his capacity as
Xxxxxxxx'x Chief Financial Officer. Executive understands that he will
not be paid an hourly rate or any other fee for the time he spends in
meeting this obligation.
10. During the term of his employment, Executive has been exposed to or has
had access to the confidential attorney-client communications of
Xxxxxxxx. Executive acknowledges and agrees that the attorney-client
privilege applicable to those communications belongs to Xxxxxxxx, not
Executive, and Executive has no authority to waive or compromise that
privilege. Executive shall not directly or indirectly use or disclose
any information or document conveyed to him in the course of his
employment that is a confidential attorney-client communication or is
attorney work product, except directly to Xxxxxxxx'x attorneys or other
duly authorized employees or representatives or as required by a
validly issued court order.
11. During his employment with Xxxxxxxx, Executive was intimately involved
in developing strategy and planning for Xxxxxxxx, and was provided or
had access to Confidential Information, as defined in paragraph 12,
below, belonging to Xxxxxxxx. Executive acknowledges and agrees that
such information has been developed or obtained by Xxxxxxxx by the
investment of significant time, effort, and expense, and that such
information is a valuable, special, and unique asset of Xxxxxxxx.
Executive further understands and acknowledges that such information is
proprietary to Xxxxxxxx and that, if exploited by Executive in
contravention of this Agreement, would seriously, adversely, and
irreparably affect the business of Xxxxxxxx.
Executive agrees that during the Severance Period, he will not disclose
or otherwise use any Confidential Information relating to Xxxxxxxx'x
business operations. For purposes of this Agreement, Confidential
Information includes financial, marketing, and other business and/or
product plans or strategies; client, customer, and vendor lists; and
all other confidential or proprietary information of Xxxxxxxx that has
not become generally available to the public by the act of one who has
the right to disclose such information without violating Xxxxxxxx'x
rights. Xxxxxxxx specifically acknowledges that Confidential
Information, as that term is used herein, shall not include any data or
information that has been voluntarily disclosed to the public (except
where such public disclosures has been made without authorization) or
that has been independently developed and disclosed by others by lawful
means, or that otherwise enters the public domain through lawful means.
12. Executive agrees that during the Severance Period, he will not directly
or indirectly solicit, through offers of employment or offers of
independent contractor relationships, any employees with whom Executive
had business contact during the last year of his employment with
Xxxxxxxx.
13. Executive agrees that during the Severance Period, he will not, on
behalf of himself or another entity, for the purpose of selling those
products or services offered by Xxxxxxxx to their customers as of the
Effective Date of this Agreement, directly or indirectly solicit or
attempt to solicit business from any client or customer of Xxxxxxxx
whom he had material business contact during the last year of his
employment with Xxxxxxxx.
14. Except as otherwise required by law, Executive shall not make any
statement, written or oral, in any forum or media, public or private,
or take any action, that disparages Xxxxxxxx. Without limiting the
foregoing, the statements prohibited by this paragraph include negative
references to Xxxxxxxx'x products and services, corporate policy,
officers, and/or directors.
15. Executive agrees that he has maintained and will continue to maintain
the confidentiality of, and will not disclose, reveal, publish,
disseminate, or discuss this Agreement, directly or indirectly, to or
with any other person or entity, except as specifically provided below.
The information regarding this Agreement that will be kept confidential
(except as specifically provided below) will include, but will not be
limited to, the fact and amount of the payment provided for herein and
any other information about this Agreement that Executive knows or
possesses. The following disclosures are permitted in the following
limited circumstances:
(a) Executive may make such disclosures as are reasonably
necessary for tax reporting purposes;
(b) Executive may disclose the terms and amount paid under this
Agreement as reasonably necessary to obtain legal, tax,
financial or estate planning or accounting advice or services;
(c) Executive is permitted to disclose the terms of this Agreement
to the extent required in any legal proceeding involving the
enforcement of this Agreement, but, as to any other legal
proceedings, he is not permitted to disclose the terms of this
Agreement except to the extent (i) specifically consented to
in writing by Xxxxxxxx, (ii) compelled pursuant to a subpoena,
court order, or other legal process; and (iii) that this
Agreement or the terms thereof enter the public domain,
including through any filing with the Securities and Exchange
Commission or other governmental agency;
(d) Executive is permitted to disclose the terms of this Agreement
to his parents, siblings, adult children, former spouse, and
spouse, provided that anyone to whom a disclosure is made
pursuant to this subparagraph 16(d) has been advised of and
agrees to abide by the confidentiality requirements of this
Agreement.
OTHER AGREEMENTS AND COVENANTS
16. The prohibitions against disclosure of Confidential Information that
are recited herein are in addition to, and not in lieu of, any rights
or remedies available pursuant to the laws of any jurisdiction or
common law or judicial precedent, to prevent the disclosure of trade
secrets or proprietary information; the enforcement of such rights and
remedies pursuant to this Agreement shall not be construed as a waiver
of any other rights or available remedies in law or equity outside this
Agreement.
17. This Agreement has been entered into in and shall be governed by and
construed under the laws of the State of Georgia without reference to
the choice of law principles thereof.
18. This Agreement shall be binding on the parties hereto and their
respective heirs, successors, and assigns.
19. If any proceeding or action at law or in equity is necessary to enforce
or interpret the terms of this Agreement, the prevailing party will be
entitled to reasonable attorneys' fees, costs, in addition to any other
relief to which such party may be entitled.
20. If fulfillment of any provision of this Agreement, at the time such
fulfillment shall be due, shall transcend the limit of validity
prescribed by law, then the obligation to be fulfilled shall be reduced
or modified to the limit of such validity; and if any clause or
provision contained herein operates or would operate to invalidate this
Agreement in whole or in part, such clause or provision alone shall be
held ineffective as though not herein contained, and the remainder of
this Agreement shall remain in full force and effect.
21. The parties acknowledge and agree that they are not relying on any
representations, oral or written, other than those expressly contained
in this Agreement. This Agreement supersedes all prior agreements,
proposals, negotiations, conversations, discussions, and course of
dealing between the parties regarding the subject matter covered
herein. This Agreement constitutes the entire Agreement between the
parties regarding the severance
of Executive's employment and all other issues addressed herein. No
modification of this Agreement will be binding upon the parties unless
set forth in a writing signed by Executive and an authorized
representative of Xxxxxxxx that specifically references this Agreement
and the provision that the parties intend to modify.
22. Executive hereby acknowledges and represents that: (a) Executive has
been given the opportunity to consider the terms of this Agreement for
at least 21 days before signing; (b) Executive is hereby advised in
writing to consult with an attorney prior to signing this Agreement;
and (c) Executive's signing of this Agreement is in exchange for
valuable and good consideration to which Executive would not otherwise
be entitled.
23. This Agreement shall not become effective or enforceable until 12:01
a.m. EDT time on the eighth (8th) day after it is signed by Executive.
12:01 a.m. on the eighth (8th) day after Executive signs this Agreement
shall be known as the "Effective Date." Executive may revoke this
Agreement at any time before the Effective Date. In the event Executive
chooses to revoke this Agreement, Executive shall give written notice
of such revocation to Xxxxxxx X. Xxxxxxxxx, Xx., King & Spalding LLP,
0000 Xxxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxx 00000, fax number (404)
572-5135, via hand delivery or facsimile, before the Effective Date. If
Executive revokes this Agreement, he will not be entitled to any of the
consideration described in this Agreement.
24. Executive affirms that he has read and understands this Agreement and
he signs this Agreement knowingly, voluntarily, and of his own free
will.
[Signatures on next page]
AGREED TO:
/s/ Xxxx X. Xxxxxx
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Executive
5/29/06
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Date
XXXXXXXX & COMPANY
By: /s/ Xxxxxx X. Xxxxxxxx
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Title: President & CEO
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Date: 5/30/06
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