Exhibit 2.4
RESIGNATION AND GENERAL RELEASE AGREEMENT
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This Resignation and General Release Agreement ("Agreement"), effective as
of this 31st day of December 1996, by and between Xxxxxx X. XxXxxxxxxx, an
individual ("XxXxxxxxxx"), and NTN Communications, Inc., a corporation
("Company"), is a resignation agreement which includes a general release of
claims.
In consideration of the covenants undertaken and the releases contained in
this Agreement, XxXxxxxxxx and Company agree as follows:
1. XxXxxxxxxx resigns effective seven days following the complete
execution of this Agreement in all capacities as an officer and as an employee
of Company and each of its subsidiaries and affiliates, such resignations to be
effective as of December 31, 1996. Company hereby agrees to retain XxXxxxxxxx
as a consultant commencing on January 1, 1997 and ending on December 31, 1999 in
accordance with the terms and conditions of the Consulting Agreement attached
hereto as Exhibit A.
2. Company and XxXxxxxxxx agree to the following actions (no payments
hereunder shall be made or other actions taken until seven days following the
complete execution of this Agreement) in full and complete discharge of any and
all of Company's obligations to XxXxxxxxxx, including, without limitation, all
obligations under XxXxxxxxxx'x Employment Agreement dated January 1, 1990, as
amended on June 19, 1992 (the "Employment Agreement"), the Performance
Associated Senior Executive Retirement Plan and the Deferred Compensation Plan:
a. Company shall pay to XxXxxxxxxx as xxxxxxxxx payments $19,788.53
per month for the 12 months ending December 31, 1997, $22,459.93 per month for
the 12 months ending December 31, 1998, and $25,492.08 per month for the 12
months ending December 31, 1999, less appropriate withholding taxes, as
required. If any severance payment is not paid by Company for more than 90
consecutive days, then the severance payments set forth in this paragraph 2(a)
shall be accelerated and become immediately due and payable.
b. Company shall pay to XxXxxxxxxx an amount of $93,671.34, payable
$5,203.96 per month for 18 months, all less appropriate withholdings, in
payment of accrued vacation to which XxXxxxxxxx is entitled under the Employment
Agreement.
c. Company shall pay to XxXxxxxxxx cash in the amount of $233,535.60
less appropriate withholdings, representing deferred compensation to which
XxXxxxxxxx is entitled.
d. Until December 31, 1999, Company shall continue to include
XxXxxxxxxx under Company's medical insurance program, without cost to
XxXxxxxxxx.
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e. Until December 31, 1999, Company shall use its best efforts to
provide (without extraordinary charges and provided that XxXxxxxxxx meets
standard insurance company requirements) XxXxxxxxxx life insurance, payable to
XxXxxxxxxx'x beneficiary, in the amount of $1,000,000, and in the event of
accidental death or dismemberment, in the amount of $2,000,000, without cost to
XxXxxxxxxx.
f. For a period of 36 months ending December 31, 1999, Company will
provide XxXxxxxxxx with a car allowance of $500 per month.
x. XxXxxxxxxx presently owns incentive or non qualified options to
purchase shares of Common Stock of Company. XxXxxxxxxx shall return to Company
for cancellation the following options:
No. of Shares Exercise Price
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30,000 $ 7.25
75,000 $6.375
95,000 $ 7.25
h. Company shall issue to XxXxxxxxxx a new fully vested option to
purchase 150,000 shares of Common Stock of Company at an exercise price of
$3.875 per share and expiring on December 31, 2001.
i. Company shall vest the following options: (a) 75,000 options
having an exercise price of $4.50 and an expiration date of August 4, 2003; and
(b) 25,000 options having an exercise price of $3.50 and an expiration date of
November 4, 2006.
x. XxXxxxxxxx is presently indebted to Company in the principal
amount of $492,690.23. Such indebtedness is represented by a promissory note
(the "Note") which provides that if XxXxxxxxxx is terminated by Company for any
reason other than for "cause" at any time within the three year term of the Note
the balance of the Note and any interest accrued thereon will be cancelled.
XxXxxxxxxx and Company agree that the Note shall be cancelled and shall be of no
further force and effect. Company shall return such cancelled Note to
XxXxxxxxxx. Company may withhold from all amounts due to Xxxxxxxxxx herein all
payroll taxes, if required by law, relating to the cancellation of the Note.
k. Company shall execute and deliver to XxXxxxxxxx the Release
attached as Exhibit B hereto.
3. As of the execution of this Agreement and as a condition to the
receipt by XxXxxxxxxx of any payments hereunder, XxXxxxxxxx has or shall have
returned to Company and shall not take or copy in any form or manner lists of
customers, prices, engineering plans, and similar confidential and proprietary
materials or information, including, without limitation, those items set forth
on Exhibit C hereto. XxXxxxxxxx represents to Company that all documents
pertaining to NTN, inclusive of existing and past subsidiaries, but
2.
exclusive of personal items, in his possession whether located on Company
premises, at XxXxxxxxxx'x home or elsewhere, have been returned to Company and
that he has retained no copies in any form. This representation applies to all
forms of written materials, including but not limited to schematics, diagrams,
formulations, tapes, descriptions of inventions and products, operator manuals,
maintenance manuals, training manuals, software manuals, software code,
technical memoranda, research bulletin, financial information, marketing plans,
identities of customers and vendors, contract terms and information obtained in
confidence from customers and vendors. XxXxxxxxxx hereby reaffirms his
obligation, as set forth in his employment agreement, secrecy agreement,
confidentiality and work for hire agreement and any other legal documents that
he signed either before or during his employment with Company not to disclose
any confidential or trade secret information to any third party and not to use
the information for any purpose whatsoever except as expressly authorized in
writing by an authorized representative of Company.
4. Company expressly denies any violation of any of its policies,
procedures, state or federal laws or regulations. Accordingly, while this
Agreement resolves all issues between Company and XxXxxxxxxx relating to any
alleged violation of Company policies or procedures or any state or federal law
or regulation, this Agreement does not constitute an adjudication or finding on
the merits and it is not, and shall not be construed as, an admission by Company
of any violation of its policies, procedures, state or federal laws or
regulations. Moreover, neither this Agreement nor anything in this Agreement
shall be construed to be or shall be admissible in any proceeding as evidence of
or an admission by Company of any violation of its policies, procedures, state
or federal laws or regulations. This Agreement may be introduced, however, in
any proceeding to enforce the Agreement. Such introduction shall be pursuant to
an order protecting its confidentiality.
5. Except for those obligations created by or arising out of this
Agreement for which receipt or satisfaction has not been acknowledged herein,
XxXxxxxxxx on behalf of himself, his descendants, dependents, heirs, executors,
administrators, assigns, and successors, and each of them, hereby covenants not
to xxx and fully releases and discharges Company, its directors, officers,
agents, attorneys, insurers, employees, stockholders, representatives, assigns
and successors, past and present, and each of them, hereinafter together and
collectively referred to as "Releasees," with respect to and from any and all
claims, wages, demands, rights, liens, agreements, contracts, covenants,
actions, suits, causes of action, obligations, debts, costs, expenses,
attorneys' fees, damages, judgments, orders and liabilities of whatever kind or
nature in law, equity or otherwise, whether now known or unknown, suspected or
unsuspected, and whether or not concealed or hidden, which he now owns or holds
or he has at any time heretofore owned or held or may in the future hold as
against said Releasees, arising out of or in any way connected with his
employment or other relationships with Company or his resignation from
employment or any other transactions, occurrences, acts or omissions or any
loss, damage or injury whatever, known or unknown, suspected or unsuspected,
resulting from any act or omission by or on the part of said Releasees, or any
of them, committed or omitted prior to the date of this Agreement including,
without limiting the generality of the foregoing, any claim under Title VII of
the Civil Rights Act of 1964, the Age Discrimination in Employment Act, the
Americans with
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Disabilities Act, the Family and Medical Leave Act of 1993, the California Fair
Employment and Housing Act, the California Family Rights Act, or any claim for
severance pay, bonus, sick leave, holiday pay, vacation pay, life insurance,
health or medical insurance or any other fringe benefit, workers' compensation
or dis6. It is the intention of Company in executing this instrument that the
same shall be effective as a bar to each and every claim, demand and cause of
action hereinabove specified. In furtherance of this intention, XxXxxxxxxx
hereby expressly waives any and all rights and benefits conferred upon him by
the provisions of SECTION 1542 OF THE CALIFORNIA CIVIL CODE and expressly
consents that this Agreement shall be given full force and effect according to
each and all of its express terms and provisions, including those related to
unknown and unsuspected claims, demands and causes of action, if any, as well as
those relating to any other claims, demands and causes of action hereinabove
specified. SECTION 1542 provides:
"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS
WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO
EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE
RELEASES, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY
AFFECTED HIS SETTLEMENT WITH THE DEBTOR."
6. XxXxxxxxxx acknowledges that he may hereafter discover claims or facts
in addition to or different from those which XxXxxxxxxx now knows or believes to
exist with respect to the subject matter of this Agreement and which, if known
or suspected at the time of executing this Agreement, may have materially
affected this Settlement. Nevertheless, XxXxxxxxxx hereby waives any right,
claim or cause of action that might arise as a result of such different or
additional claims or facts. XxXxxxxxxx acknowledges that he understands the
significance and consequences of such release and such specific waiver of
SECTION 1542.
7. XxXxxxxxxx expressly acknowledges and agrees that, by entering into
this Agreement he is waiving any and all rights or claims that he may have
arising under the Age Discrimination in Employment Act of 1967, as amended,
which have arisen on or before the date of execution of this Agreement.
XxXxxxxxxx further expressly acknowledges and agrees that:
a. He was orally advised by Company and is hereby advised in writing
by this Agreement to consult with an attorney before signing this Agreement;
b. He was given a copy of this Agreement and informed that he has
twenty-one (21) days within which to consider the Agreement; and
c. He was informed that he has seven (7) days following the date of
execution of the Agreement in which to revoke the Agreement.
4.
8. XxXxxxxxxx acknowledges that by reason of his position with Company he
has been given access to lists of customers, prices, engineering plans, and
similar confidential or proprietary materials or information respecting
Company's business affairs. XxXxxxxxxx represents that he has held all such
information confidential and will continue to do so, and that he will not use
such information for any business (which term herein includes a partnership,
firm, corporation or any other entity) without the prior written consent of
Company.
9. XxXxxxxxxx agrees that the terms and conditions of this Agreement
shall remain confidential as between the parties and he shall not disclose them
to any other person except for his attorneys and tax advisors or except as
otherwise required by law or in the event of public disclosure of such matters
by Company. Without limiting the generality of the foregoing, XxXxxxxxxx will
not respond to or in any way participate in or contribute to any public
discussion, notice or other publicity concerning, or in any way relating to,
execution of this Agreement or the events (including any negotiations) which led
to its execution. Without limiting the generality of the foregoing, XxXxxxxxxx
specifically agrees that he shall not disclose information regarding this
Agreement to any current or former employee of Releasees. XxXxxxxxxx hereby
agrees that disclosure by him of any of the terms and conditions of the
Agreement in violation of the foregoing shall constitute and be treated as a
material breach of this Agreement.
10. XxXxxxxxxx warrants and represents that, to the best of his knowledge,
XxXxxxxxxx has not heretofore assigned or transferred to any person not a party
to this Agreement any released matter or any part or portion thereof and
XxXxxxxxxx shall defend, indemnify and hold harmless Company from and against
any claim (including the payment of attorneys' fees and costs actually incurred
whether or not litigation is commenced) based on or in connection with or
arising out of any such assignment or transfer.
11. XxXxxxxxxx and Company acknowledge that any employment or contractual
relationship between them terminated on December 31, 1996, and that they have no
further employment or contractual relationship except as may arise out of this
Agreement.
12. All payments hereunder shall be reduced by federal and state income
tax withholding, if required, and other applicable withholding taxes.
XxXxxxxxxx shall be exclusively liable for the payment of all federal and state
taxes which may be due as the result of the consideration received from the
settlement of disputed claims as set forth herein and XxXxxxxxxx hereby
represents that XxXxxxxxxx shall make payments on such taxes at the time and in
the amount required of XxXxxxxxxx. In addition, XxXxxxxxxx hereby agrees fully
to defend, indemnify and hold harmless Releasees and each of them from payment
of taxes, interest and/or penalties that are required of them by any government
agency at any time as the result of payment of the consideration set forth
herein.
13. This instrument constitutes and contains the entire agreement and
understanding concerning XxXxxxxxxx'x employment, resignation from the same and
the other subject matters addressed herein between the parties, and supersedes
and replaces all
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prior negotiations and all agreements proposed or otherwise, whether written or
oral, concerning the subject matters hereof. This is an integrated document.
This Agreement may be modified only by a writing signed by the parties.
14. Either XxXxxxxxxx or Company may revoke this Agreement in its entirety
during the seven days following execution of the Agreement by XxXxxxxxxx. Any
revocation of the Agreement must be in writing and hand delivered during the
revocation period. This Agreement will become effective and enforceable seven
days following execution by XxXxxxxxxx, unless it is revoked during the seven-
day period.
15. If any provision of this Agreement or the application thereof is held
invalid, the invalidity shall not affect other provisions or applications of the
Agreement which can be given effect without the invalid provisions or
applications and to this end the provisions of this Agreement are declared to be
severable.
16. This Agreement shall be deemed to have been executed and delivered
within the State of California, and the rights and obligations of the parties
hereunder shall be construed and enforced in accordance with, and governed by,
the laws of the State of California.
17. This Agreement may be executed in counterparts.
18. Any dispute or controversy between XxXxxxxxxx, on the one hand, and
Company (or any Releasee), on the other hand, in any way arising out of, related
to, or connected with this Agreement or the subject matter thereof, otherwise in
any way arising out of, related to, or connected with XxXxxxxxxx'x employment
with Company, shall be resolved through final and binding arbitration in San
Diego, California, pursuant to California Civil Procedure Code (S)(S) 1282-
1284.2. The arbitration shall be before the American Arbitration Association
Employee Dispute Panel and shall be governed by the National Rules for the
Resolution of Employment Disputes promulgated by the American Arbitration
Association. In the event of such arbitration, the prevailing party shall be
entitled to recover all reasonable costs and expenses incurred by such party in
connection therewith, including attorneys' fees. The nonprevailing party shall
also be solely responsible for all costs of the arbitration, including, but not
limited to, the arbitrator's fees, court reporter fees, and any and all other
administrative costs of the arbitration, and promptly shall reimburse the
prevailing party for any portion of such costs previously paid by the prevailing
party. Any dispute as to the reasonableness of costs and expenses shall be
determined by the arbitrator.
19. In entering this Agreement, the parties represent that they have
relied upon the advice of their attorneys, who are attorneys of their own
choice, and that the terms of this Agreement have been completely read and
explained to them by their attorneys, and that those terms are fully understood
and voluntarily accepted by them.
20. All parties agree to cooperate fully and to execute any and all
supplementary documents and to take all additional actions that may be necessary
or appropriate to give full
6.
force to the basic terms and intent of this Agreement and which are not
inconsistent with its terms.
21. This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their successors and assigns.
22. In consideration of the payment of $28,358.92, receipt of which is
hereby acknowledged, XxXxxxxxxx agrees that for a period of 36 months from the
date hereof XxXxxxxxxx shall not, directly or indirectly, without the prior
written consent of Company:
a. solicit, entice, persuade or induce any employee, consultant,
agent or independent contractor of Company, or of any of the subsidiaries or
affiliates of Company to terminate his or her employment with Company, or such
subsidiary or affiliate, to become employed by any person, firm or corporation
other than Company, or such subsidiary or affiliate or approach any such
employee, consultant, agent or independent contractor for any of the foregoing
purposes, or authorize or assist in the taking of any such actions by any third
party; or
b. directly or indirectly own, manage, control, invest, or
participate in any way in, consult with or render services for any person or
entity (other than Company), or any of the subsidiaries or affiliates of Company
engaged in any business in direct competition with the primary businesses
presently conducted by Company, or any of the subsidiaries or affiliates of
Company. Notwithstanding anything in this Section 2b to the contrary, nothing
in this Agreement shall limit XxXxxxxxxx'x right to hold and make passive
investments not in excess of 2 1/2% of the outstanding Common Stock of any
publicly traded entity.
23. This Agreement embodies the entire agreement of the parties and
supersedes any other prior oral or written agreements, arrangements or
understandings between XxXxxxxxxx and Company. This Agreement may not be
changed or terminated orally but only by an agreement in writing signed by the
parties hereto.
24. The waiver by Company of a breach of any provision of this Agreement
by XxXxxxxxxx shall not operate or be construed as a waiver of any subsequent
breach by him. The waiver by XxXxxxxxxx of a breach of any provision of this
Agreement by Company shall not operate or be construed as a waiver of any
subsequent breach by Company.
25. Each party has cooperated in the drafting and preparation of this
Agreement. Hence, in any construction to be made of this Agreement, the same
shall not be construed against any party on the basis that the party was the
drafter.
I have read the foregoing Agreement and I accept and agree to the
provisions it contains and hereby execute it voluntarily with full understanding
of its consequences.
7.
EXECUTED as of this 31st day of December 1996 in San Diego County,
California.
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Xxxxxx X. XxXxxxxxxx
Approved as to form:
By:
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Attorney for Xxxxxx X. XxXxxxxxxx
EXECUTED as of this 31st day of December 1996 in San Diego, California.
NTN COMMUNICATIONS, INC.
By:
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Approved as to form:
XXXX & XXXXX PROFESSIONAL CORPORATION
By:
---------------------------------
Attorney for NTN Communications, Inc.
8.
ENDORSEMENT
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I, Xxxxxx X. XxXxxxxxxx, hereby acknowledge that I was given or took 21
days to consider the foregoing Agreement and voluntarily chose to sign the
Agreement prior to the expiration of the 21-day period.
EXECUTED as of this 31st day of December 1996, in San Diego County,
California.
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Xxxxxx X. XxXxxxxxxx
9.
Dear NTN Communications, Inc.
This is to advise you that effective December 31, 1996, I hereby resign my
position as an officer and employee of NTN Communications, Inc. and as an
officer, director and employee of any subsidiaries or affiliates of NTN
Communications, Inc.
Very truly yours,
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Xxxxxx X. XxXxxxxxxx
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