SEPARATION AGREEMENT AND GENERAL RELEASE
Exhibit
10.12
SEPARATION AGREEMENT AND
GENERAL RELEASE
This
SEPARATION AGREEMENT AND
GENERAL RELEASE (“Agreement”) is made as of this 18th day of
June 2009 by and between MEDIALINK WORLDWIDE INCORPORATED, a Delaware
corporation, having an address at 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
(“Medialink”), and XXXXXXX X. XXXXXXXX, an individual residing at 000 Xxxxxxxx
Xxxxxx, Xxxxxx Xxxxxx, Xxx Xxxx 00000 (“Xxxxxxxx”).
NOW, THEREFORE, in
consideration of the mutual promises and covenants hereinafter set forth, the
parties agree as follows:
1. This
Agreement shall be deemed effective (the “Effective Date”) upon the execution
date of that certain agreement and plan of merger (the “Merger Agreement”)
between Medialink, The NewsMarket, Inc. (“TNM”) and a wholly owned subsidiary of
TNM (the “Merger Partner”); provided, however, that in the event that the
proposed merger transaction (the “Merger”) pursuant to the Merger Agreement is
not consummated by December 31, 2009, then this Agreement shall be null and void
and of no force and effect.
2. Xxxxxxxx
and Medialink are parties to that certain Amended and Restated Employment
Agreement dated as of November 12, 2008 (the “Employment Agreement”) pursuant to
which Xxxxxxxx performed duties as the Chief Financial Officer of
Medialink. Certain terms of the Employment Agreement, including
without limitation, Sections 5.3-5.5, 8.3 and 11 and Exhibit A are expressly
modified by the terms of this Agreement. Xxxxxxxx’x employment
relationship with Medialink will be deemed (with no further action required by
Medialink) terminated by Medialink effective as of the date on which the Merger
becomes effective (the “Termination Date”). The termination of
Xxxxxxxx’x employment hereunder shall not be deemed a For Cause termination, as
such term is defined in the Employment Agreement. Nothing herein
shall be deemed to affect Xxxxxxxx’x compensation or benefits prior to the
Termination Date.
3. Xxxxxxxx
acknowledges that he fully understands the terms and implications of this
Agreement. Xxxxxxxx has carefully considered other alternatives to
executing this Agreement and has decided that he will execute this
Agreement.
4. Xxxxxxxx
understands that he will have up to twenty-one (21) days from the date hereof to
review and execute this Agreement and that he shall have the right, within seven
(7) days after his execution of this Agreement, to revoke same unless such right
is waived by Xxxxxxxx. If and to the extent Xxxxxxxx executes this
Agreement prior to the expiration of the twenty-one (21) day period referred to
above, Xxxxxxxx represents and warrants to Medialink that he has done so
knowingly and voluntarily.
5. Xxxxxxxx
further recognizes that he executes this Agreement voluntarily and that
Medialink requires that he discuss the same with his legal advisors to ensure
full and thorough knowledge of the legal significance of this
Agreement. Medialink agrees to reimburse Xxxxxxxx for all reasonable
legal fees incurred in the review of this Agreement, up to a maximum
reimbursement of $1,500. Xxxxxxxx has been represented by
__________________________ in his review and consideration of this
Agreement.
6. (a) In
lieu and in place of any payments or benefits otherwise due Xxxxxxxx under
Sections 5.3-5.5 and/or 8.3 and Exhibit A of the Employment Agreement and in
consideration for Xxxxxxxx signing and adhering to the terms and conditions of
this Agreement, Xxxxxxxx will receive the gross amount of Six Hundred Twenty
Thousand and 00/100 ($620,000) Dollars, subject to downward adjustment as set
forth below, which amount shall be reduced by all applicable deductions as shall
be required to be withheld by applicable law and regulation (the “Severance
Payment”). Such Severance Payment will be payable in one lump sum no
later than fifteen (15) business days after the Termination Date and shall not
be offset by any amounts Xxxxxxxx earns or could have earned with reasonable
diligence after the Termination Date. Xxxxxxxx expressly releases
Medialink from making any payments or making any benefits available pursuant to
Sections 5.3-5.5 and/or 8.3 and Exhibit A of the Employment
Agreement.
(b) The amount
of the Severance Payment referenced above is subject to downward adjustment
based on Medialink’s Adjusted Cash Balance as of the closing of the Merger (the
“Closing”). For purposes of this calculation, Adjusted Cash Balance
means the sum of (A) the actual cash available at the Closing (after payment or
accrual of Medialink’s transaction costs associated with the Merger) (i) prior
to payment of (x) contractual and non-contractual severance obligations
(including the Severance Payment) and (y) 2009 board of directors’ fees, and
(ii) adjusted, upward or downward for the Working Capital Adjustment (as such
term is defined in the Merger Agreement) and (B) the amount of severance
obligations assumed by the Merger Partner pursuant to the Merger
Agreement. The amount of the Severance Payment shall be adjusted as
follows:
(i) If
the Adjusted Cash Balance is at least equal to $1,390,000, there shall be no
adjustment to the amount of the Severance Payment;
(ii) If
the Adjusted Cash Balance is at least equal to $1,126,000 but less than
$1,390,000, then the Severance Payment shall be reduced by an amount equal to
the product of (A) 0.55 and (B) the amount by which the actual Adjusted Cash
Balance falls short of $1,390,000; or
(iii) If
the Adjusted Cash Balance is less than $1,126,000, then the Severance Payment
shall be reduced by an amount equal to the sum of (A) $145,000 and (B) the
product of (x) 0.50 and (y) the amount by which the actual Adjusted Cash Balance
falls short of $1,126,000.
For
purposes of clarification, an adjustment shall be made pursuant to only one of
Sections 6(b)(ii) or 6(b)(iii) above, but not both.
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(c) Xxxxxxxx
and Medialink agree that notwithstanding anything to the contrary herein, in the
event that during the period between the Effective Date and the Termination
Date, Xxxxxxxx dies or suffers a Disability (as such term is defined in Section
6.1 of the Employment Agreement), then Xxxxxxxx (or his estate, as the case may
be) shall be entitled to receive from Medialink the benefits set forth in
Sections 5.4 (upon death) or 5.5 (upon a Disability) of the Employment Agreement
until the Termination Date, and from and after the Termination Date, if any,
Xxxxxxxx (or his estate, as the case may be) shall receive, in lieu of such
benefits, the payment set forth in Section 6(a), as adjusted by Section 6(b) of
this Agreement.
7. The
Company agrees to pay and Xxxxxxxx acknowledges that he will have been paid his
accrued and unpaid salary and bonus through the Termination Date and is not
entitled to any further payments for same. Xxxxxxxx further
acknowledges that he will not be entitled to participate in any of Medialink’s
benefit plans after the Termination Date; provided, however, that Xxxxxxxx may
continue to participate in Medialink’s hospitalization and group health benefit
plans pursuant to the Consolidated Omnibus Budget Reconciliation Act (COBRA) at
Xxxxxxxx’x sole cost and expense, unless otherwise provided by law.
8. As
a condition to Xxxxxxxx receiving the Severance Payment referenced above and as
a material inducement for Medialink to enter into this Agreement:
(a) Xxxxxxxx
agrees to be available to Medialink for telephone consultations for up to thirty
(30) days after the Termination Date. In no event shall Xxxxxxxx be
required to be available for more than an aggregate of ten (10) hours during
such period.
(b) Xxxxxxxx
agrees that on the Termination Date, Xxxxxxxx shall deliver all Medialink
Property, as hereinafter defined, in his custody or possession to Medialink or
its representatives, and Xxxxxxxx represents and warrants that no such Medialink
Property or copies thereof have been knowingly retained by him, any of his
representatives or any person, firm or corporation owned or controlled by him or
delivered to any third party other than in the normal course of performing his
duties pursuant to the Employment Agreement. The term “Medialink
Property” as used herein means any and all confidential or proprietary materials
belonging to Medialink that are in Xxxxxxxx’x possession, including but not
limited to books, records, files, documents, accounting or financial records,
statements, reports, equipment, computer hardware, computer software, programs,
contact lists, customer data and files (hardcopies and electronic), any
proprietary information or data of Medialink in any format and any and all
copies thereof, hard drives, keys to Xxxxxxxx’x offices and files, computer
passwords provided by Medialink to Xxxxxxxx, passwords established by Xxxxxxxx
on Medialink hardware and passwords established by Xxxxxxxx on any file
containing Medialink information. Notwithstanding the foregoing,
Xxxxxxxx shall be permitted, at his sole option, to retain the cell phone and
phone number, pda/BlackBerry, laptop computer with one docking station and one
monitor that were used by Xxxxxxxx immediately prior to the Termination Date;
provided however, that all Medialink Property must be removed from each item
retained, and each retained item shall be subject to prompt review and
modification by Medialink’s IT personnel to ensure that all Medialink Property
has been permanently removed therefrom. In addition, the laptop
computer, if any, retained by Xxxxxxxx shall be reformatted by Medialink’s
personnel; provided, however, that Medialink will reload standard software
(including, but not limited to, Microsoft Office and Adobe Acrobat) on the
retained laptop computer and, to the extent reasonably practicable, provide
Xxxxxxxx with the pertinent licenses, discs, and manuals related to such
reloaded software. After the Termination Date, Xxxxxxxx, and not
Medialink, shall be responsible for any service fees associated with the use and
maintenance of any of the retained items.
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(c) Xxxxxxxx
acknowledges that the principal business of Medialink is providing video and
audio production and satellite and other distribution services to television and
radio stations and online news outlets for corporations and other organizations
seeking to communicate their news to the public (the
“Business”). Xxxxxxxx acknowledges that he has acquired confidential
information concerning Medialink and the Business and that, among other things,
his knowledge of the Business was enhanced through his employment by Medialink.
Xxxxxxxx acknowledges that such information is of great value to Medialink, is
the sole property of Medialink, and was acquired by him in
confidence.
(d) Xxxxxxxx
hereby confirms that (i) the confidentiality and transfer of developments
obligations set forth in Section 10.1 of the Employment Agreement survive the
termination of Xxxxxxxx’x employment and (ii) Xxxxxxxx will abide by and adhere
to such obligations.
(e) The Parties
agree that the provisions of Section 11 of the Employment Agreement are hereby
waived and replaced by this Section 8(e). Xxxxxxxx acknowledges that
it is reasonably necessary for the protection of Medialink that Xxxxxxxx agree,
and, accordingly, Xxxxxxxx does hereby agree, that for the period ending on the
three (3) month anniversary of the Termination Date, he will not, directly or
indirectly:
i. employ
or engage, or cause to authorize, directly or indirectly, to be employed or
engaged, for or on behalf of himself or any third party, any employee,
representative or agent of Medialink; or
ii. solicit,
directly or indirectly, on behalf of himself or any third party, any client or
vendor, for services competitive with the Business, of Medialink and its
affiliates.
(f) Xxxxxxxx
agrees that upon Medialink’s request, he shall enter into a voting agreement
whereby Xxxxxxxx will agree to vote his shares of Medialink stock (and all
shares under his control) in favor of the Merger. Xxxxxxxx further agrees
that he shall support approval of the Merger.
(g) Xxxxxxxx
agrees that any breach or threatened breach by him of Section 8 of this
Agreement shall entitle Medialink, in addition to all other legal remedies
available to it, to apply to any court of competent jurisdiction to seek to
enjoin such breach or threatened breach without posting a bond or showing
special damages. The parties understand and intend that each
restriction agreed to by Xxxxxxxx hereinabove shall be construed as separable
and divisible from every other restriction, that the unenforceability of any
restriction shall not limit the enforceability, in whole or in part, of any
other restriction, and that one or more of all of such restrictions may be
enforced in whole or in part as the circumstances warrant. In the
event that any restriction in this Agreement is more restrictive than permitted
by law in the jurisdiction in which Medialink seeks enforcement thereof, such
restriction shall be limited to the extent permitted by law.
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9. (a) Xxxxxxxx
hereby stipulates, agrees, and understands that in consideration of the payments
set forth in Section 6 above, that being good and valuable consideration,
Xxxxxxxx hereby acting of his own free will, voluntarily and on behalf of
himself, his heirs, administrators, executors, successors, and assigns, releases
Medialink, its subsidiaries, affiliates, directors, officers, members,
employees, attorneys, representatives, and agents and each of them and their
predecessors, successors and assigns (hereinafter “Medialink Parties”) from any
and all debts, obligations, claims, demands, judgments or causes of action of
any kind whatsoever in tort, contract, by statute, or on any other basis for
compensatory, punitive or any other damages, expenses, reimbursements or costs
of any kind, including but not limited to any and all claims, demands, rights,
and/or causes of action arising out of an alleged breach of the Employment
Agreement or relating to purported employment discrimination or violations such
as Civil Rights violations, including, but not limited to, those arising under
Title VII of the Civil Rights Act of 1964 (42 U.S.C. section 2000e, et seq.), the Civil
Rights Act of 1991, the Civil Rights Act of 1866 and 1871 (42 U.S.C. sections
1981 and 1983), Executive Order 11246 as amended, the Age Discrimination in
Employment Act of 1967 (29 U.S.C. section 621, et seq.), the Equal Pay
Act of 1963 (29 U.S.C. section 26(d)(1), the Rehabilitation Act of 1973 (29
U.S.C. section 701-794), the Americans with Disabilities Act (ADA), the New York
Human Rights Law, Exec. Law, CH. 118, Art. 15, section 290, et seq. or any other
applicable federal, state or local employment discrimination statute or
ordinance which Xxxxxxxx might have or assert against any of the Medialink
Parties: (1) by reason of his employment relationship or dealings
with Medialink or the termination of said relationship and all circumstances
related thereto; or (2) by reason of any other matter, cause or thing
whatsoever, from the first date of employment to the date of execution of this
Agreement, except that the foregoing (i) does not affect the future right of
Xxxxxxxx and/or any heir, administrator, executor, successor, and assign to
enforce the terms of this Agreement, and (ii) does not waive any vested benefits
under any welfare, pension or retirement benefit plan maintained by Medialink,
which shall be governed by the applicable plan or COBRA, as the case may
be.
(b) Medialink
hereby stipulates, agrees, and understands that in consideration of the
obligations undertaken herein by Xxxxxxxx, that being good and valuable
consideration, Medialink, on behalf of itself and the Medialink Parties, hereby
releases Xxxxxxxx from any and all debts, obligations, claims, demands,
judgments or causes of action of any kind whatsoever in tort, contract, by
statute, or on any other basis for compensatory, punitive or any other damages,
expenses, reimbursements or costs of any kind arising out of or related to any
fact, thing or matter which is known to Medialink as of the date of this
Agreement. The knowledge of Xxxxxxxx shall not be imputed to
Medialink.
10. Xxxxxxxx
agrees and understands that failure in any material respect to adhere to the
terms and conditions of this Agreement, including but not limited to the
provisions of Sections 8 and 9 of this Agreement, as well as any action
commenced by him against the Medialink Parties, other than to enforce the terms
of this Agreement, shall immediately void Medialink’s obligation to pay the
amounts set forth above, and any and all monies and/or benefits provided for
herein to Xxxxxxxx and shall require immediate repayment by Xxxxxxxx of the
value of all consideration paid or provided to Xxxxxxxx by Medialink pursuant to
this Agreement. Further, in any action by one party hereof against
the other party to enforce the terms of this Agreement, the prevailing party
shall be entitled to reimbursement from the non-prevailing party for the
prevailing party’s reasonable costs and attorneys’ fees in defending or
prosecuting such action.
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11. (a) Xxxxxxxx
represents that he has not filed any lawsuits or demands for arbitration against
Medialink, or filed or caused to be filed any charges or complaints against
Medialink with any municipal, state or federal agency charged with the
enforcement of any law. Pursuant to and as part of Xxxxxxxx’x release
of Medialink as set forth above, Xxxxxxxx agrees to the fullest extent permitted
by law, not to xxx, or file a charge, complaint, grievance or demand for
arbitration against Medialink in any forum or assist or otherwise participate
willingly or voluntarily in any claim, arbitration, suit, action, investigation
or other proceeding of any kind which relates to any matter that involves
Medialink, and that occurred up to and including the date of his execution of
this Agreement, unless required to do so by law. To the extent any
such action may be brought by a third party, Xxxxxxxx expressly waives any claim
to any form of monetary or other damages, or any other form of recovery or
relief in connection with any such action.
(b) Notwithstanding the
provisions of Section 9(a) and Section 11(a) above, the agreement of Xxxxxxxx
not to file a lawsuit or complaint or charge against the Medialink Parties as
provided in Section 11(a) shall not be deemed, construed or interpreted as
prohibiting Xxxxxxxx from filing a charge or complaint against the Medialink
Parties with the U.S. Equal Opportunity Commission (the “EEOC”), the New York
State Division of Human Rights (the “DHR”) or any other state or federal
governmental agency or authority or from participating in any investigation or
proceeding which may be brought by the EEOC, the DHR or any other governmental
agency or authority against the Medialink Parties; provided however, even though
Xxxxxxxx may file any such complaint or charge or participate in any such
investigation or proceeding, he shall not be entitled or permitted to
participate in or receive any monetary damages or assessments made by the EEOC,
the DHR or any other governmental agency or authority against the Medialink
Parties. In addition, the agreement of Xxxxxxxx not to file a lawsuit
or complaint or charge against the Medialink Parties as contained in Section
11(a) shall not be deemed, construed or interpreted as prohibiting Xxxxxxxx from
challenging the validity of the release contained in Section 9(a) or his
agreement not to file a lawsuit or complaint or charge against the Medialink
Parties as contained in Section 11(a).
12. Medialink
acknowledges that Xxxxxxxx may make an application for unemployment benefits and
Medialink agrees not to contest or object to same, provided that such
application is truthful and accurate.
13. Medialink
agrees that, other than disclosures required by law, rule or regulation, it will
make no disclosures concerning Xxxxxxxx’x employment or other information
regarding Xxxxxxxx, except to the extent requested to do so by Xxxxxxxx and
except to state that pursuant to Medialink policy it can only confirm
employment, job title, dates of service, rate of pay or to disclose other
information as required by law.
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14. Medialink
and Xxxxxxxx agree that confidentiality is a material condition of this
Agreement. Xxxxxxxx agrees not to disclose or make reference to the
terms of this Agreement without prior written consent of Medialink, except as
required by law; provided, however, that disclosure shall be permitted to
Xxxxxxxx’x attorney, financial advisors and immediate family, and to any new or
potential employers of Xxxxxxxx. Nothing herein shall preclude
Xxxxxxxx from discussing in general terms his duties and responsibilities while
at Medialink. Xxxxxxxx acknowledges that Medialink will file all
appropriate securities filings with regard to the termination of Xxxxxxxx’x
employment relationship with Medialink.
15. Xxxxxxxx
further agrees that he shall make no negative statements concerning any aspect
of the business of Medialink or concerning any of the Medialink Parties or The
NewsMarket, Inc. or the Merger Partner. Medialink agrees that it
shall make no negative statements regarding Xxxxxxxx.
16. Xxxxxxxx
acknowledges that, other than as expressly set forth herein, he has no
entitlement to severance pay, change in control payments, or any benefit
resulting from the termination of his relationship with
Medialink. Xxxxxxxx further understands that his receiving the
consideration set forth in this Agreement is conditional upon his signing and
not revoking this Agreement and complying with the terms and provisions
hereof.
17. If
any provision, or portion thereof, of this Agreement is determined to be invalid
under applicable statute or rule of law, only such provision, and only to the
extent determined to be invalid, shall be deemed omitted from this Agreement,
the remainder of which shall remain in full force and effect.
18. This
Agreement, together with the Employment Agreement as modified herein,
constitutes the complete agreement between the parties and no other
representations have been made by Medialink or Xxxxxxxx. This
document resolves all outstanding issues arising from Xxxxxxxx’x relationship
with Medialink.
19. This
Agreement and its execution, validity and interpretation shall be governed in
all respects in accordance with the laws of the State of New York, excluding its
conflicts of law rules. The parties hereto agree that any legal suit,
action, or proceeding against them arising out of or relating to this Agreement
shall be brought exclusively in the United States Federal Court in the Southern
District of New York or in the Supreme Court for the State of New York, County
of New York. The parties hereto hereby accept the jurisdictions of
such courts for the purpose of any such action or proceeding. EACH
PARTY HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY
RIGHT TO A TRIAL BY JURY IN RESPECT TO ANY PROCEEDING BROUGHT BY ONE PARTY
AGAINST ANOTHER RELATED TO THIS AGREEMENT.
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20. This
Agreement may be executed simultaneously in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
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MEDIALINK
WORLDWIDE INCORPORATED
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/s/
Xxxxxxx X. Xxxxxxxx
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By:
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/s/
Xxxxxx Xxxxxx
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XXXXXXX
X. XXXXXXXX
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Name: Xxxxxx
Xxxxxx
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Title: Chair.
Compensation Committee
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Date: June
18, 2009
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Date: June
19, 2009
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