SEPARATION AND RELEASE AGREEMENT
THIS
SEPARATION AND RELEASE AGREEMENT (the “Agreement”) is entered into as of the
25th
day of
April, 2008, by and between, Xxxxx Xxxxxxxx (“Employee”) and Customer
Acquisition Network Holdings, Inc., and any parents, subsidiaries, or affiliates
of the Company, including, without limitation, Customer Acquisition Network,
Inc. (collectively referred to herein as the “Company”).
WHEREAS,
Employee
and the Company are parties to an Employment Agreement, dated as of June 28,
2007 (the “Employment Agreement”);
WHEREAS,
Employee
is currently employed as the Chief Financial Officer of the Company and holds
the position as Treasurer of the Company and is a member of the Company’s Board
of Directors;
WHEREAS,
this
Agreement governs the terms of Employee’s separation from the
Company.
NOW,
THEREFORE,
in
consideration of the mutual covenants and agreements contained herein and for
other good and valuable consideration, the receipt and sufficiency of which
are
hereby acknowledged, and intending to be legally bound, the parties hereby
agree
as follows:
1. Effective
Date of Resignation.
Employee acknowledges that, as of the date of this Agreement, he is resigning
from his positions as Chief
Financial Officer and Treasurer of the Company as well as from his position
as a
member of the Company’s Board of Directors.
Employee agrees to execute any and all documents as may be reasonably necessary
to confirm his resignation from such positions. Employee has agreed to remain
in
the position of Interim Chief Financial Officer until the earlier of (i) the
Company’s retention of a Chief Financial Officer or (ii) May 15, 2008. The
Company will advise Employee, in writing, of the termination date of Employee’s
position as Interim Chief Financial Officer. The Employee understands and agrees
that, as of the date he is notified of the termination of his position as
Interim Chief Financial Officer, he will be no longer authorized to conduct
any
business on behalf of the Company or to hold himself out as an officer,
employee, agent or representative of the Company. The Employee understands
and
agrees that, as of the of the date he is notified of the termination of his
position as Interim Chief Financial Officer, he will be no longer authorized
to
incur any expenses, obligations, or liabilities on behalf of the Company.
As
Interim CFO (or such other designation as the Company and Employee may mutually
agree), Employee shall use his best efforts to assist in the orientation of
a
newly appointed CFO or Interim CFO hired by the Company. Further, as Interim
CFO, Employee shall use his best efforts to assist the Company in the
preparation and filing of any upcoming required securities filings for the
financial quarter ending March 31, 2008. As Interim CFO, Employee shall not
at
any time be required to execute any securities filings, regulatory documents
or
supporting documents for such matters.
2. Severance.
As
severance, the Company shall pay to Employee $175,000 (the “Severance
Payments”), which amount shall be paid as follows: (i) $50,000 within ten (10)
business days of the Employee’s execution of this Agreement, and (ii) $125,000
to be paid in accordance with the Company’s regular payroll practices,
commencing on the earlier of May 15, 2008 or the date that Employee is
terminated as interim CFO. The Severance Payments shall be made provided that
Employee does not revoke his acceptance of the Agreement pursuant to Section
15
below. The Severance Payments will be subject to any and all applicable taxes
and withholdings.
Employee
acknowledges and agrees that the Severance Payments provided to him, as set
forth within this paragraph, exceed any and all payments and/or benefits that
would otherwise be due to the Employee as severance and unpaid salary and
benefits, and that Employee is not entitled to any other payments, salary,
commissions, compensation or benefits from the Company aside from what is set
forth within this paragraph, with the exception of payment for any accrued
but
unused vacation days for which the Company will provide payment to the Employee
within five (5) business days of the date he is notified of the termination
of
his position as Interim Chief Financial Officer.
3. Treatment
of Equity Holdings.
(A) Founder’s
Stock:
Employee will retain equity in the Company which he was awarded as “Founder’s
Stock” pursuant to his Employment Agreement. In connection with such award, the
Employee entered into a Lock-Up Agreement dated June 28, 2007. At any time
prior
to December 27, 2008, Employee agrees to enter into one (1) additional Lock-Up
Agreement, as may be required by the Company, which supersedes the prior Lock-Up
Agreement dated June 28, 2007, with regard to these shares, on the same terms
and conditions as all other members of the Company’s Board of Directors. From
and after December 27, 2008, Employee shall not be obligated to enter into
any
further Lock-Up Agreements or similar restrictive covenants. Employee agrees
not
to sell, transfer or otherwise dispose of any of his Founder Shares at any
time
before execution of the one (1) additional Lock-Up Agreement which shall be
presented to him following execution of this Agreement and prior to December
27,
2008.
(B) Options:
Employee is entitled to the 93,855 options which have vested as of the date
of
this Agreement pursuant to the terms and conditions of the grants authorized
by
the Board of Directors on August 28, 2007 and October 12, 2007. Employee shall
not be entitled to any additional options, including, but not limited to any
options vesting after April 12, 2008. For purposes of the Outsider’s
Entertainment, Inc. 2007 Equity Incentive Plan, Employee shall be deemed to
have
voluntarily resigned his employment with the Company. Notwithstanding any
provision of the Plan or any other agreement between Employee and the Company
or
any other party to the contrary, the Company agrees that Employee shall have
the
unqualified right to exercise any of the vested options for a period of twelve
(12) consecutive calendar months from the date of this Agreement.
4. Employee
Release.
In
exchange for the consideration provided for in this Agreement, Employee
irrevocably and unconditionally releases the Company, its predecessors, parents,
subsidiaries, affiliates, and past, present and future officers, directors,
agents, consultants, employees, representatives, and insurers, as applicable,
together with all successors and assigns of any of the foregoing (collectively,
the “Releasees”), of and from all claims, demands, actions, causes of action,
rights of action, contracts, controversies, covenants, obligations, agreements,
damages, penalties, interest, fees, expenses, costs, remedies, reckonings,
extents, responsibilities, liabilities, suits, and proceedings of whatsoever
kind, nature, or description, direct or indirect, vested or contingent, known
or
unknown, suspected or unsuspected, in contract, tort, law, equity, or otherwise,
under the laws of any jurisdiction, that the Employee or his predecessors,
legal
representatives, successors or assigns, ever had, now has, or hereafter can,
shall, or may have, against the Releasees, as set forth above, jointly or
severally, for, upon, or by reason of any matter, cause, or thing whatsoever
from the beginning of the world through, and including, the date of this
Agreement (“Claims”).
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Such
release includes, but is not limited to, the violation of any express or implied
contract; any federal, state or local laws, restricting an employer’s right to
terminate employees, or otherwise regulating employment; workers compensation,
wage and hour, or other employee relations statutes, executive orders,
ordinance, or regulations, including any rights or claims under Title VII of
the
Civil Rights Act of 1964, as amended the Civil Rights Act of 1991, the Americans
with Disabilities Act of 1990, the Rehabilitation Act of 1973, the Family and
Medical Leave Act of 1993, the Civil Rights Act of 1866, the Employee Retirement
Income Security Act of 1974, the Age Discrimination in Employment Act of 1967,
the Fair Labor Standards Act, the WARN Act, or any state or local laws covering
the same subject matter; tort (including, without limitation, negligent conduct,
invasion of privacy and defamation); any federal, state, or local laws providing
recourse for retaliation, wrongful discharge, dismissal or other obligations
arising out of public policy, physical or personal injury, fraud, negligent
misrepresentations, and similar or related claims. The laws referred to in
this
section include statutes, regulations, other administrative guidance, and common
law doctrines. Any and all claims and/or disputes arising out of or relating
to
any of the foregoing shall be, and are, finally compromised, released and
settled.
Notwithstanding
the foregoing, this release does not include Employee’s right to enforce the
terms of this Agreement. Employee understands that this Agreement releases
claims that he may not know about. This is Employee’s knowing and voluntary
intent, even though Employee recognizes that someday he might learn that some
or
all of the facts that he currently believes to be true are untrue and even
though he might then regret having signed this Agreement.
Except
to
enforce this Agreement, Employee agrees that he will not pursue, file or assert
or permit to be pursued, filed or asserted any civil action, suit or legal
proceeding seeking equitable or monetary relief (nor will he seek or in any
way
obtain or accept any such relief in any civil action, suit or legal proceeding)
in connection with any matter concerning his employment relationship with the
Company and/or the termination thereof with respect to all of the claims
released herein arising from the beginning of the world up to and including
the
date of execution of this Agreement (whether known or unknown to him and
including any continuing effects of any acts or practices prior to the date
of
execution of this Agreement). Except for the payments and benefits set forth
herein, Employee acknowledges that he has been paid all wages and other amounts
due to him and that he is not entitled to any other payments or benefits of
any
kind.
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If
Employee should bring any action arising out of the subject matter covered
by
this Agreement, except to enforce this Agreement, he understands and recognizes
that he will, at the option of the Company, be considered in breach of this
Agreement and shall be required to immediately return any and all funds received
pursuant to this Agreement. Furthermore, if the Company should prevail
concerning any or all of the issues so presented, Employee shall pay to the
Company all of the costs and expenses of defense, including attorney’s
fees.
5. Company
Release.
In
exchange for the consideration provided for in this Agreement,
the
Company irrevocably and unconditionally releases the Employee of and from all
claims, demands, causes of actions, fees and liabilities of any kind whatsoever,
which it had, now has or may have against the Employee, as of the date of this
Agreement, by reason of any actual or alleged act, omission, transaction,
practice, conduct, statement, occurrence, or any other matter, within the
reasonable scope of the Employee’s employment that is known to the Company. The
Company represents that, as of the date of this Agreement, there are no known
claims relating to the Employee.
6. Restrictions
on Competition and Solicitation.
Employee agrees and acknowledges that the Restrictive Covenants section of
the
Employment Agreement (Section 7) remains in full force and effect and that
he is
obligated to comply with any and all restrictions as may be contained therein.
7. Company
Information and Property.
Employee agrees to immediately return to the Company all Company property and
information in his possession including, but not limited to, Company reports,
customer lists, supplier lists, consultant lists, formulas, files, manuals,
memoranda, computer equipment, access codes, discs, software, and any other
Company business information or records, in any form in which they are
maintained, including records or information regarding Company customers,
suppliers and vendors, and Company products and product development, and agrees
that he will not retain any copies, duplicates, reproductions, or excerpts
thereof in any form. Employee further agrees that he will not, in any manner,
make use of any Company property and information in any future dealings,
business or otherwise, and acknowledges that any use of Company property and
information in any future dealings, business or otherwise, would constitute
a
breach of this Agreement. Employee acknowledges that any breach of this section
would cause irreparable injury to the Company for which there is no adequate
remedy at law and in addition to any remedies that may be available to the
Company in the event of a breach or threatened breach of this section by
Employee, including monetary damages, the Company shall be entitled to obtain
a
temporary restraining order and/or a preliminary or permanent injunction which
would prevent Employee from violating or attempting to violate the provisions
of
this section of the Agreement. In seeking such an order, any requirement to
post
a bond or other undertaking shall be waived. In any such action, the Company
shall be entitled to an award of all reasonable costs and fees incurred in
bringing such an action, including reasonable attorney’s fees.
8. Confidentiality.
Employee agrees that he will not disclose, directly or indirectly, the
underlying facts that led up to this Agreement or the terms or existence of
this
Agreement. Employee represents that he has not and will not, in any way,
publicize the terms of this Agreement and agrees that its terms are confidential
and will not be disclosed by him except that he may discuss the terms of this
Agreement with his attorneys, financial advisors, accountants, and members
of
his immediate family, or as required by law. Employee understands and agrees
that should he violate this provision of the Agreement, he will be responsible
to the Company for liquidated damages in the amount of any and all funds payable
pursuant to this Agreement and understands that such monetary relief shall
not
be a bar to the Company’s pursuit of injunctive relief.
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9. Non-disparagement.
Employee represents and agrees that he shall refrain from making any written
or
oral statements to any person or entity with whom the Company or Employee has
had or may have a business or social relationship which may reasonably be
expected to impugn or degrade the character, integrity, ethics or business
practices of the Company, its affiliates, employees, directors, officers,
agents, representatives or clients, or which may reasonably be expected to
damage the business, image or reputation of the Company, its affiliates,
employees, directors, officers, agents, representatives, or clients.
The
Company represents and agrees that it shall refrain from making any written
or
oral statements to any person or entity with whom the Company or the Employee
has had or may have a business or social relationship which may reasonably
be
expected to impugn or degrade the character, integrity, or ethics of the
Employee. Should there by any inquiry as to the Employee’s employment with the
Company, the Company agrees to provide the following information: dates of
Employee’s employment with the Company, position held by Employee, and the
reason for Employee’s departure (i.e.,
voluntary
resignation), and will not otherwise comment about the Employee or about the
Employee’s performance of his duties and responsibilities while employed by the
Company.
10. Indemnity.
The
Company shall indemnify and hold harmless Employee from any and all losses,
costs, damages, expenses, claims, or charges (including reasonable attorneys’
fees and costs) arising out of or in any way connected with Employee’s
employment with the Company and Employee having served as an officer and
director of the Company for any actions taken by Employee within the reasonable
scope of his employment in such capacities during the time period Employee
was
employed by the Company.
11. Future
Cooperation.
Employee agrees to reasonably cooperate with the Company, its financial and
legal advisors, in connection with any business matters for which the Employee’s
assistance may be required and in any claims, investigations, administrative
proceedings or lawsuits which relate to the Company and for which Employee
may
possess relevant knowledge or information. Any travel and accommodation expenses
incurred by the Employee as a result of such cooperation will be reimbursed
in
accordance with the Company’s standard policies.
12. Applicable
Law and Jurisdiction.
This
Agreement shall be governed by and construed in accordance with the laws of
the
State of New York, without regard to its conflicts of law principles. Any
dispute regarding this Agreement or related to the Employee’s employment with
the Company shall be resolved in the Courts located in New York County, New
York, without a jury (which is hereby expressly waived).
13. Entire
Agreement.
This
Agreement may not be changed or altered, except by a writing signed by both
parties. Until such time as this Agreement has been executed and subscribed
by
both parties hereto: (i) its terms and conditions and any discussions relating
thereto, without any exception whatsoever, shall not be binding nor enforceable
for any purpose upon any party; and (ii) no provision contained herein shall
be
construed as an inducement to act or to withhold an action, or be relied upon
as
such. This Agreement constitutes an integrated, written contract, expressing
the
entire agreement and understanding between the parties with respect to the
subject matter hereof and supersedes any and all prior agreements and
understandings, oral or written, between the parties, including the Employment
Agreement, except as otherwise provided herein.
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14. Assignment.
Employee has not assigned or transferred any claim he is releasing, nor has
he
purported to do so. If any provision in this Agreement is found to be
unenforceable, all other provisions will remain fully enforceable. This
Agreement binds Employee’s heirs, administrators, representatives, executors,
successors, and assigns, and will insure to the benefit of all Released Parties
and their respective heirs, administrators, representatives, executors,
successors, and assigns.
15. Binding
Effect.
This
Agreement will be deemed binding and effective immediately upon its execution
by
the Employee; provided, however, that in accordance with the Age Discrimination
in Employment Act of 1967 (“ADEA”) (29 U.S.C. § 626, as amended), Employee’s
waiver of ADEA claims under this Agreement is subject to the following: Employee
may consider the terms of his waiver of claims under the ADEA for twenty-one
(21) days before signing it and may consult legal counsel if Employee so
desires. Employee may revoke his waiver of claims under the ADEA within seven
(7) days of the day he executes this Agreement. Employee’s waiver of claims
under the ADEA will not become effective until the eighth (8th) day following
Employee’s signing of this Agreement. Employee may revoke his waiver of ADEA
claims under this Agreement by delivering written notice of his revocation,
via
facsimile and overnight mail, before the end of the seventh (7th) day following
Employee’s signing of this Agreement to: Mr. Xxxxxxx Xxxxxxx, Chief Executive
Officer, 000 Xxxx Xxxxxx Xxxxx, Xxxxx 000, Xxx Xxxx, Xxx Xxxx 00000 (fax:
000-000-0000). In the event that Employee revokes his waiver of ADEA claims
under this Agreement prior to the eighth (8th) day after signing it, the
remaining portions of this Agreement shall remain in full force in effect,
except that the obligation of the Company to provide the payments and benefits
set forth in Section 2 of this Agreement shall be null and void. Employee
further understands that if Employee does not revoke the ADEA waiver in this
Agreement within seven (7) days after signing this Agreement, his waiver of
ADEA
claims will be final, binding, enforceable, and irrevocable.
EMPLOYEE
UNDERSTANDS THAT FOR ALL PURPOSES OTHER THAN HIS WAIVER OF CLAIMS UNDER THE
ADEA, THIS AGREEMENT WILL BE FINAL, EFFECTIVE, BINDING, AND IRREVOCABLE
IMMEDIATELY UPON ITS EXECUTION.
16. Acknowledgement.
Employee acknowledges that he: (a) has carefully read this Agreement in its
entirety; (b) has been presented with the opportunity to consider it for at
least twenty-one (21) days; (c) has been advised to consult and has been
provided with an opportunity to consult with legal counsel of his choosing
in
connection with this Agreement; (d) fully understands the significance of all
of
the terms and conditions of this Agreement and has discussed them with his
independent legal counsel or has been provided with a reasonable opportunity
to
do so; (e) has had answered to his satisfaction any questions asked with regard
to the meaning and significance of any of the provisions of this Agreement;
and
(f) is signing this Agreement voluntarily and of his own free will and agrees
to
abide by all the terms and conditions contained herein.
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| CUSTOMER ACQUISITION NETWORK HOLDINGS, INC. | ||||
| By: | /s/ Xxxxxxx Xxxxxxx | |||
|
Xxxxxxx Xxxxxxx, Chief Executive Officer |
||||
| Executed on the 25 day of April, 2008 | ||||
| By: | /s/ Xxxxx Xxxxxxxx | |||
|
Xxxxx Xxxxxxxx |
||||
| Executed on the 25 day of April, 2008 | ||||
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