October 5, 2007
October
5, 2007
By
Hand Delivery
Xx.
Xxxxx
Xxxxxxxx
Diet
Coffee, Inc.
00
Xxxx
00xx
Xxxxxx,
00xx
Xxxxx
Xxx
Xxxx,
XX 00000
Re: Resignation
of Employment and Release Of All Claims Agreement
Dear
Xxxxx:
You
have
agreed to resign from your position as Chief Financial Officer and Secretary
and
as a director of Diet Coffee, Inc., a Delaware corporation (the “Company”).
Accordingly, the Company will provide you with the following severance benefits
in exchange for your resignation and a release of all claims that you may have
against the Company.
This
letter agreement (the “Letter Agreement”), which is made and entered into by the
parties as of Effective Date (as defined in Section E.2), documents the terms
of
your severance from the Company’s employment.
Now,
therefore, in consideration of the mutual promises contained in this Letter
Agreement, you and the Company agree, covenant, and represent as follows:
| A. |
Resignation
and Termination Of Employment; Consideration.
|
1. You
agree
to resign from all positions of employment with the Company, including, but
not
limited to, your positions as Chief Financial Officer and Secretary, and the
Company will accept your resignation, effective October 5, 2007 (the
“Termination Date”). You shall also resign your position as a director. You and
the Company hereby agree to waive any and all continuing rights and obligations,
if any, under your Employment Agreement dated July 14, 2006, and as amended
from
time to time (“Employment Agreement”), which the parties agree has expired and
is of no further force or effect.
2. The
Company shall pay to you, as consideration for your agreement to resign and
enter into this Letter Agreement, the total gross amount of $90,000 (the
“Termination Payment”). The Termination Payment shall be paid as follows:
$20,000 on the Effective Date (of which $10,000 is for reimbursement of
out-of-pocket business expenses), and thereafter, in equal semi-monthly
installments of $5,000, which shall be paid on each payroll date of the Company,
until the entire Termination Payment has been made. The Company will withhold
from the Termination Payment all applicable payroll taxes, including federal
and
state income taxes, as well as other authorized deductions. You acknowledge
that, upon receipt of the final installation of the Termination Payment, you
will have been paid all wages, all unreimbursed business expenses, and all
accrued but unused vacation pay due and owing to you as of the Termination
Date
of this Agreement, and you waive any unpaid salary or wage amounts, unreimbursed
business expenses, and accrued but unused vacation pay.
1
3. You
will
retain ownership of 2,125,000 shares of the Company’s common stock currently
held by you.
|
B.
|
The
Company’s Responsibilities.
|
1. The
Company shall withhold from the Termination Payment all state, federal or other
taxes, as well as any other authorized deductions.
2. You
are
qualified to continue your group-medical and dental benefits for eighteen (18)
months from the Termination Date at your own expense pursuant to the
Consolidated Omnibus Budget Reconciliation Act (“COBRA”). If you elect to obtain
such COBRA coverage, you will pay the full amount of the premiums which are
chargeable for such COBRA coverage. All other benefits will cease as of the
Termination Date.
3. On
the
Effective Date, the Company shall issue to you 5,000,000 shares (the “Shares”)
of common stock of the Company. The Shares shall have the status of “restricted”
securities as the term is defined by Rule 144 under the Securities Act of 1933,
as amended.
4. You
and
the Company will enter into a Consulting Agreement in the form attached hereto
as Exhibit A, which shall become effective concurrently with the Effective
Date.
5. You
and
the Company agree, covenant and represent that you shall not be eligible for,
or
entitled to receive, any severance benefits, stock, stock options, or any other
benefits other than those specifically identified in this Letter
Agreement.
|
C.
|
Your
Duties And Responsibilities.
|
1. You
hereby agree that you will keep confidential and will not reveal to anyone
any
information whatsoever obtained in the course of you employment relating to
any
aspect whatsoever of the Company’s business, strategies decision making process,
finances, customers, customer lists, purchasing and trade practices, strategies,
financial information, sources or related information, to any other person,
company, entity group or individual, to the extent that you obtained such
knowledge or information while employed by the Company (“Confidential
Information”), except
that you are not precluded from responding to any inquiry about the Company,
your employment, or this Letter Agreement to any self regulatory organization,
regulatory, administrative or governmental agency, in response to judicial
process or as may be necessary with regard to the preparation and filings with
the Internal Revenue Service.
2
2. To
forestall any use or disclosure of Confidential Information in breach of this
Letter Agreement, you agree, covenant, and represent that, during the period
commencing with the Termination Date and for one year thereafter, you will
not
directly or indirectly through any person, firm, corporation, or other business
entity engage in any activity in competition with the Company’s product
opportunities during your tenure, make any financial investment (except that
you
may own up to 2% of the shares in a publicly traded company that may compete
with the Company’s product opportunities during your tenure, or provide other
services to a business or individual engaged in competition with the Company’s
product opportunities during your tenure. If you violate the terms of this
Section C.2, the Company’s obligation to pay installments of the Termination
Payments Section A.2.a of this Letter Agreement will immediately cease. However,
all other terms of this Letter Agreement shall remain in full force and effect.
3. You
acknowledge that the Company’s relationships with its employees, affiliates,
consultants, customers, clients, business associates, and other persons are
valuable business assets. To forestall any interference with these
relationships, you agree, covenant, and represent that during the period
commencing with the Termination Date and for one year thereafter, you will
not
directly or indirectly through any person, firm, corporation, or other business
entity: (a) divert or attempt to divert from the Company any business of any
kind in which it is engaged, including, without limitation, the solicitation,
initiation of contact with, or interference with any of its suppliers or
customers; or (b) employ, solicit for employment, or recommend for employment
any person employed by the Company. If you violate the terms of this Section
C.3, the Company’s obligation to pay installments of the Termination Payments
Section A.2.a of this Letter Agreement will immediately cease. However, all
other terms of this Agreement shall remain in full force and effect.
4. You
further agree, covenant, and represent that you will not take any action or
make
any comments that actually or potentially disparage, disrupt, damage, impair,
or
otherwise interfere with the Company’s business interests or reputation,
except
that you are not precluded from responding to any inquiry about the Company,
your employment, or this Letter Agreement to any self regulatory organization,
regulatory, administrative or governmental agency, in response to judicial
process or as may be necessary with regard to the preparation and filings with
the Internal Revenue Service.
|
D.
|
Release
Provisions.
|
1. In
exchange for the consideration described in this Letter Agreement, including
the
Termination Payment, and for other good and valuable consideration, the receipt
and adequacy of which are hereby acknowledged, you for yourself and for your
heirs, assigns, executors, administrators, agents and successors, past and
present (collectively, the “Employee Affiliates”), hereby fully and without
limitation release, covenant not to xxx, and forever discharge the Company
and
its subsidiaries, parent companies, divisions, affiliated corporations,
affiliated partnerships, trustees, directors, officers, shareholders, partners,
agents, representatives, employees, consultants, insurance carriers, attorneys,
heirs, assigns, executors and administrators, predecessors and successors,
past
and present (the “Releasees”), both individually and collectively, from any and
all rights, claims, demands, liabilities, charges, complaints, obligations,
promises, agreements, controversies, debts, actions and causes of action whether
in law or in equity, suits, damages, losses, workers’ compensation claims,
attorneys’ fees, costs, and expenses, of whatever nature whatsoever, known or
unknown, fixed or contingent, suspected or unsuspected (“Claims”), that you or
the Employee Affiliates now have, or may ever have, against the Company or
any
of the other Releasees for any acts or omissions by the Company or any of the
other Releasees occurring prior to the Effective Date of this Agreement. Without
limiting the generality of the foregoing, this Release applies to any Claims
that you or the Employee Affiliates now have, or may ever have, against the
Company or any of the other Releasees that arise out of, or are in any manner
related to any of the following: (i) your employment by the Company or any
of
the other Releasees; (ii) the termination of your employment with the Company
or
any of the other Releasees; and (iii) any transactions, occurrences, acts
or omissions by the Company or any of the other Releasees occurring prior to
the
Effective Date of this Agreement.
3
2. Without
limiting the generality of the foregoing, you specifically and expressly release
any Claims against the Company and the other Releasees occurring prior to the
Effective Date of this Agreement arising out of or related to violations of
any
federal or state employment discrimination law, including Executive Order 11141,
the Age Discrimination In Employment Act, Title VII of the Civil Rights Act
of
1964, 29 U.S.C. §1981 et.
seq.,
the
Americans With Disabilities Act, the National Labor Relations Act, the Fair
Labor Standards Act, the Equal Pay Act, the Rehabilitation Act of 1974, the
Employee Retirement Income Security Act of 1974, and any analogous laws under
the state of New York, as well as Claims arising out of or related to violations
of the provisions of state and federal wage and hour laws, breach of contract,
express or implied, any covenant of good faith and fair dealing, express or
implied, fraud, misrepresentation, common counts, unfair competition, unfair
business practices, negligence, defamation, infliction of emotional distress,
invasion of privacy, assault, battery, false imprisonment, wrongful termination,
and any other state or federal law, rule, or regulation.
3. You
agree, covenant, and represent that you have not suffered any work-related
injuries while employed by the Company, that you have no intention to file
any
claim for workers’ compensation benefits of any type against the Company, and
that you will not file or attempt to file any claims for workers’ compensation
benefits of any type against the Company. You acknowledge that the Company
has
relied upon these covenants and representations, and that the Company would
not
have entered into this Letter Agreement but for these covenants and
representations. As a result, you agree, covenant, and represent that the
Company may, but is not obligated to, submit this Letter Agreement to the
Workers’ Compensation Appeals Board for approval as a compromise and release as
to any such new or unasserted workers’ compensation claims.
4. In
exchange for the consideration described in this Letter Agreement, and for
other
good and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the Company, for itself and its subsidiaries, parent companies,
divisions, affiliated corporations, affiliated partnerships, trustees,
directors, officers, shareholders, partners, agents, representatives, employees,
consultants, insurance carriers, attorneys, heirs, assigns, executors and
administrators, predecessors and successors, past and present hereby fully
and
without limitation releases, covenants not to xxx, and forever discharge you
for
yourself and for your heirs, assigns, executors, administrators, agents and
successors, past and present, both individually and collectively, from any
and
all rights, claims, demands, liabilities, charges, complaints, obligations,
promises, agreements, controversies, debts, actions and causes of action whether
in law or in equity, suits, damages, losses, attorneys’ fees, costs, and
expenses, of whatever nature whatsoever, known or unknown, fixed or contingent,
suspected or unsuspected, that the Company now have, or may ever have, against
you for any acts or omissions by you occurring prior to the Effective Date
of
this Agreement.
4
| E. |
Older
Worker’s Benefit Protection
Act.
|
1. This
Agreement is subject to the terms of the Older Workers Benefit Protection Act
of
1990 (the “OWBPA”). The OWBPA provides that an individual cannot waive a right
or claim under the Age Discrimination in Employment Act (“ADEA”) unless the
waiver is knowing and voluntary. Pursuant to the terms of the OWBPA, you
acknowledge and agree that you have executed this Agreement voluntarily, and
with full knowledge of its consequences.
2. In
addition, you hereby acknowledge and agree that: (a) this Letter Agreement
has been written in a manner which you fully understand; (b) the release
provisions of this Agreement apply to any rights you may have under the ADEA,
including the right to file a lawsuit against the Company for age
discrimination; (c) the release provisions of this Agreement do not apply to
any
rights or claims that you may have under the ADEA that arise after the date
that
you execute this Agreement; (d) the Company does not have a preexisting duty
to
pay the severance and other payments identified in this Agreement; (e) you
have
the right to consult with an attorney prior to executing this Agreement; (f)
you
will have a period of 21 days in which to consider the terms of this Agreement
prior to its execution; and (g) you will have a period of seven days after
execution of this Agreement in which to revoke this Agreement. You further
understand that this Agreement shall not become effective until expiration
of
this seven-day period (the “Effective Date”).
| F. |
Non-Admission
of Liability.
|
You
agree, covenant, and represent that this Letter Agreement constitutes a
compromise of, and full accord and satisfaction of, any and all claims that
you
may have against the Company or any other Releasee. You further agree, covenant,
and represents that this Agreement shall not be treated as an admission of
liability by the Company, at any time or for any purpose, and may not be used
in
any other proceeding, except a proceeding to enforce or interpret the terms
of
this Letter Agreement.
5
| G. |
Arbitration.
|
All
disputes between you (and your attorneys, successors, and assigns) and the
Company and/or any other Releasee which arise out of or relate in any manner
whatsoever to your employment with, or the termination of your employment with,
the Company (“Arbitrable Claims”) including, without limitation, all disputes
relating to the validity, interpretation, or enforcement of this Letter
Agreement, shall be resolved exclusively by arbitration in New York, New York,
by the Judicial Arbitration & Mediation Services, Inc. (“JAMS”), before one
or more experienced employment arbitrators licensed to practice law in New
York.
Such arbitration shall be conducted in accordance with the then-existing
arbitration rules of JAMS. The parties to this Agreement, and all who claim
thereunder, shall be (i) conclusively bound by the arbitrator’s decision or
award, which shall not be subject to appeal; and (ii) have the right to
have any decision or award rendered in accordance with this provision entered
as
a judgment in a court in the State of New York or any other court having
jurisdiction. The arbitrator shall have the authority to award or grant legal,
equitable, and declaratory relief. The parties hereby waive any rights they
may
have to trial by jury. The Federal Arbitration Act will govern the
interpretation and enforcement of this Section. The prevailing party in any
such
arbitration shall be awarded its costs, expenses, and actual attorney’s fees
incurred in connection with the arbitration. You and the Company shall each
be
responsible for payment of one-half of the amount of the arbitrator’s fee(s).
The parties specifically agree that the exclusive venue of such arbitration
shall be New York, New York.
| H. |
Severability.
|
The
parties to this Agreement agree, covenant and represent that each and every
provision of this Agreement shall be deemed to be contractual, and that they
shall not be treated as mere recitals at any time or for any purpose. Therefore,
the parties further agree, covenant and represent that each and every provision
of this Agreement shall be considered severable, except for the release
provisions of Sections D of this Agreement. If a court of competent jurisdiction
finds the release provisions of Section D of this Agreement to be unenforceable
or invalid, then this Agreement shall become null and void, and you will repay
any and all settlement payments made by the Company pursuant to this Agreement
within a reasonable period of time not to exceed 30 days. If a court of
competent jurisdiction finds any provision other than the release provisions
of
Section D, or part thereof, to be invalid or unenforceable for any reason,
that
provision, or part thereof, shall remain in force and effect to the extent
allowed by law, and all of the remaining provisions of this Agreement shall
remain in full force and effect and enforceable.
|
I.
|
General
Provisions.
|
1. You
represent and warrant that you have not assigned or transferred any interest
in
any Claims that you may have against the Company or any of the other Releasees.
Accordingly, you agree to indemnify and hold the Company and the Releasees
harmless from any liability, claims, demands, damages, expenses, and attorneys’
fees incurred by the Company or any Releasee as a result of any person or entity
asserting any such assignment or transfer of any right or claim. You understand
and agree that this Letter Agreement may be pleaded as a defense,
cross-complaint, counter-suit, cross-claim, or third party complaint in any
action involving the Company or any other Releasee.
6
2. You
and
the Company agree, covenant, and represent that this Letter Agreement and its
attachments and the Consulting Agreement constitute a single, integrated written
contract expressing the entire agreement of the parties hereto, and that this
Letter Agreement supersedes and completely replaces the terms of any other
agreement that you may have ever had with the Company or any other Releasee.
There is no other agreement, written or oral, express or implied, between you
and the Company with respect to the subject matter hereof. This Letter Agreement
may not be orally modified, and may only be modified in a written instrument
signed by all parties.
3. This
Letter Agreement has been negotiated and entered into in the State of New York,
and is to be performed in New York, New York. This Letter Agreement shall be
governed by and interpreted in accordance with the laws of the State of New
York, including all matters of construction, validity, performance, and
enforcement, without regard to New York’s conflict of law rules.
4. This
Letter Agreement shall be binding upon and shall inure to the benefit of the
respective heirs, assigns, executors, administrators, successors, subsidiaries,
divisions and affiliated corporations and partnerships, past and present, and
trustees, directors, officers, shareholders, partners, agents and employees,
past and present, of you and the Company.
5. The
captions and section numbers in this Agreement are inserted for the reader’s
convenience, and in no way define, limit, construe, or describe the scope or
intent of the provisions of this Agreement.
6. This
Agreement has been reviewed by the parties. The parties have had a full
opportunity to negotiate the terms and conditions of this Agreement.
Accordingly, the parties expressly waive any common-law or statutory rule of
construction that ambiguities should be construed against the drafter of this
Agreement, and agree, covenant, and represent that the language in all parts
of
this Agreement shall be in all cases construed as a whole, according to its
fair
meaning.
7
By
your
signature below, you confirm that you accept and agree to all of the provisions
contained in this Letter Agreement, and that you are executing this Letter
Agreement voluntarily, with full understanding of its consequences.
| DIET COFFEE, INC. | |||
|
By: Xxxx Xxxxx, Director |
ACKNOWLEDGMENT
AND AGREEMENT
I
HAVE
READ THE FOREGOING LETTER AGREEMENT AND ACCEPT AND AGREE TO ALL OF THE
PROVISIONS CONTAINED THEREIN, AND HEREBY EXECUTE IT VOLUNTARILY, WITH FULL
UNDERSTANDING OF ITS CONSEQUENCES. I FURTHER ACKNOWLEDGE AND UNDERSTAND THAT
THIS AGREEMENT INCLUDES A RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS.
IF
THIS
LETTER AGREEMENT IS SIGNED BEFORE THE 21-DAY REVIEW PERIOD EXPIRES, YOU
ACKNOWLEDGE AND AGREE THAT YOU HAVE VOLUNTARILY WAIVED THE REVIEW
PERIOD.
|
Xxxxx
Xxxxxxxx
|
Date
|
8
