EMPLOYMENT AND TERMINATION AGREEMENT
This Agreement, entered into June 26, 1997 is between Storage
Technology Corporation, a Delaware corporation (the "Company") and
Xxxx X. Xxxxxxxx ("Employee").
WHEREAS, prior to the termination date of this Agreement Employee served
as Executive Vice President, World Wide Field for the Company;
WHEREAS, the Company and Employee wish to provide for his continued
employment and terms of termination from the Company and to resolve all
claims between them. By this Agreement the parties set out the terms and
ongoing obligations of the parties with respect to his termination of
employment with the Company.
The parties agree as follows:
1. CONTINUING EMPLOYMENT:
a. First Employment Period: Employee will continue as a regular
full-time employee of the Company through February 28, 1998
(hereafter the period from July 1, 1997 to February 28, 1998 is
referred to as the "First Employment Period"). During the First
Employment Period Employee will be deemed a Corporate Officer for
all purposes, including but not limited to benefits, including but
not limited to executive life insurance, auto, tax planning,
medical and airfare, as well as restrictions on trading in the
Company's securities. He will also be eligible for, and will
receive an MBO bonus payment for 1997 based on the achievement of
the Corporate Officer's MBO bonus plan goals for the Company.
Employee will report to the Chief Executive Officer of the Company,
and be responsible for such projects and activities as may be
assigned by the CEO, or his designee. All projects must be
reasonable assignments considering Employee's experience and
position. Employee shall not be required to have an office at any
Company location. Employee shall obtain required offices at his
own expense. During the First Employment Period all salary and
benefits will remain as they were on June 1, 1997. During the
First Employment Period Employee will not accept any employment,
whether as a director, consultant, or on a full-time, part-time or
any other basis with any company other than StorageTek, will not
accept any assignment from any person other than the CEO or his
designee and will not make any investment in or lend any money to
any company in a computer related business (other than equity
investments of less than 1% of the shares outstanding or debt
investments in publicly traded companies). Acceptance of any such
employment or assignment, or making any such loan or investment
during this First Employment Period will be deemed a voluntary
termination of employment by Employee, and will be treated
accordingly for all purposes, and Employee shall not be entitled to
any severance or other benefits under the letter agreement between
the Company and Employee dated February 17, 1995 (the "Letter
Agreement").
b. Second Employment Period: Employee will continue as a regular
full-time employee at a salary of 50% of his June 1, 1997 salary
level from March 1, 1998 through December 31, 1998 (the "Second
Employment Period"). During the Second Employment Period, Employee
will continue to report to and accept assignments from the CEO or
his designee. All assignments must be reasonable, considering
Employee's experience and position. However, Employee will not be
asked to accept assignments which require him to work for more than
50% of his time for the Company, and he will no longer be deemed a
Corporate Officer. As such he will only be entitled to such
benefits as are available to regular full-time employees of the
Company at a director level, and no benefits available only to the
Corporate Officer level will be provided except that he shall be
entitled to the termination benefits set forth in the Letter
Agreement. During this Second Employment Period, Employee will not
participate in the 1998 MBO bonus plan, or receive any other form
of incentive or bonus compensation, except for stock options and
restricted stock granted to Employee prior to the date hereof. If
during the Second Employment Period Employee accepts any
employment, whether as a director or consultant, or on a full-time,
part-time or any other basis with any of the companies listed on
Exhibit A (hereinafter "Competitor Company"), then accepting such
employment will be deemed a voluntary termination of employment by
Employee, and will be treated accordingly for all purposes, and
Employee shall not be entitled to any severance or other benefits
under the Letter Agreement.
c. If Employee accepts full time employment during the Second
Employment Period with a company which is not a Competitor Company,
but does not accept any employment with a Competitor Company, then
Employee may terminate his employment with the Company, but he
shall continue to receive, on a bi-weekly basis, the balance of his
salary otherwise due through December 31, 1998 ( that is 50% of his
monthly salary as of June 1, 1997, but no bonus or other incentive
compensation). This amount will be in addition to any amount
payable under Section 4 below.
d. During the term of Employee's continuing employment he will
continue to be bound by all of his other obligations to the
Company, including but not limited to his duties of loyalty and
care and his Proprietary Rights Agreement. The forgoing provisions
of this agreement are not intended to prohibit the Company from,
and the Company reserves its right to terminate Employee for
"Cause" at any time as that term is defined in the Letter
Agreement. If Employee's employment is terminated for Cause then
he shall be entitled to no further payments or benefits under this
Agreement or the Letter Agreement as of the date of such
termination.
2. TERMINATION OF EMPLOYMENT
a. The parties agree that unless otherwise agreed hereafter, and
except for a termination pursuant to any of the above provisions,
Employee's employment with the Company will cease as of December
31, 1998.
b. In the event that Employee accepts employment which, under the
terms of Section 1(a) or 1(b) above is deemed a voluntary
termination, or Employee breaches this Agreement, then, in addition
to any other remedies, the Company shall be relieved of its
obligation to pay further salary or other payments due hereunder or
under the Letter Agreement, and prior payments and other
commitments by the company shall be deemed adequate consideration
for Employee's obligations hereunder, provided, however, that
Employee shall be entitled to any benefits which have vested under
any of the Company's benefit plans.
3. SETTLEMENT AND RELEASE:
a. Employee hereby irrevocably and unconditionally releases and
discharges the Company, its past and present subsidiaries,
divisions, officers, directors, agents, employees, successors, and
assigns (separately and collectively, "releasees") jointly and
individually, from any and all claims, known or unknown, which he,
his heirs, successors or assigns have or may have against releasees
and any and all liability which releasees may have to him whether
denominated claims, demands, causes of action, obligations,
damages, or liabilities arising from any and all bases, however
denominated, including but not limited to, any claims of
discrimination under the Age Discrimination in Employment Act, the
Older Workers Benefit Protection Act, the Rehabilitation Act, the
Family Medical Leave Act, the Americans with Disabilities Act,
Title VII of the Civil Rights Act of 1964, the Civil Rights Act of
1991 or any federal or state civil rights act, claims for wrongful
discharge, breach of contract, or for damages under any other
federal, state or local law, rule or regulation, or common law
under any theory; provided, however, that this release does not
affect (1) any claims for benefits which have vested or shall vest
on or before December 31, 1998 under any of the Company's benefit
plans; (2) any claims for indemnification for acts of Employee
which have occurred or may occur as on officer or employee of the
Company; or (3) any claims which may arise after the execution of
this Agreement. This release specifically excepts any claim
Employee may wish to make for unemployment compensation, and the
Company agrees not to contest any claim made by Employee for
unemployment compensation. This release is for any relief, no
matter how denominated, including, but not limited to, back pay,
front pay, compensatory damages, punitive damages, or damages for
pain and suffering. Employee further agrees that he will not file
or permit to be filed on his behalf any such claim, will not permit
himself to be a member of any class seeking relief against the
releasees and will not counsel or assist in the prosecution of
claims against the releasees, whether those claims are on behalf of
himself or others, unless he is under a court order to do so.
Notwithstanding any other provision of this Agreement or the Letter
Agreement, Employee voluntarily relinquishes and shall not under
any circumstances be paid any sum under paragraph 5(b) of the
Letter Agreement.
b. The Company hereby irrevocably and unconditionally releases
and discharges Employee and his heirs, successors, and assigns
(separately and collectively, "releasees"), jointly and
individually , from any and all claims, known or unknown, which it,
its past and present subsidiaries, divisions, officers, directors,
agents, employees, successors, and assigns have or may have against
releasees and any and all liability which releasees may have to it,
whether denominated claims, demands, causes of action, obligations,
damages or liabilities arising from any and all bases, however
denominated, provided, however, that this release does not affect
any claims which are based on releasees' willful acts, gross
negligence or dishonesty in the performance of duties as an
employee of the Company, nor any claims which may arise after the
execution of this Agreement. The Company further agrees that it
will not file or permit to be filed on its behalf any claim against
Employee which is released hereby.
4. PAYMENT TERMS: In the event that Employee complies in all respects
with the terms of this Agreement, and subject to his execution of a
second release, in the form attached hereto as Exhibit B (the "Release")
to be signed on or after December 31, 1998 (the "Termination Date"), the
Company will pay to Employee the amount due pursuant to Section 5(a) of
the Letter Agreement as specified in the Release. Except as otherwise
provided in this Agreement, all stock options and restricted stock will
continue to vest through the Termination Date and will be exercisable
after the date in accordance with their terms.
5. EMPLOYEE BENEFITS: After the Termination Date, Employee shall be
entitled to continue his coverage under the Company's group medical and
dental plans to the extent provided in, and subject to his satisfaction
of the requirements of, the Company's standard Health Care Continuation
Notice. If Employee chooses to extend the benefits through COBRA,
Employee will be responsible for completing the Benefits Continuation
Notice and payment of premiums.
6. PENDING AND FUTURE LITIGATION:
a. Pending Litigation: During his employment and thereafter,
Employee agrees to participate in litigation currently active
against the Company by giving advice, participating in discovery
and giving deposition and trial testimony as may be necessary, as
well as participation in other activities related to said defense.
b. Future Litigation: During his employment and thereafter,
Employee also agrees to participate in the defense of any future
litigation arising out of the period of his employment with the
Company by giving advice, participating in discovery and giving
deposition and trial testimony as may be necessary, as well as
participation in other activities related to said defense.
c. If Employee is required to participate in either pending or
future litigation, the Company agrees to reimburse Employee for all
out of pocket expenses reasonably incurred in connection therewith.
7. NONCOMPETITION.
a. Employee covenants and agrees that through December 31, 1998,
he will not, directly or indirectly, for himself or for any other
individual or entity, own, manage, operate or control or
participate in the ownership (except for public share ownership of
less than 5% of total outstanding shares), management, operation or
control of, or having a controlling financial interest in any
Competitor Company in any country throughout the world or any city
or county within any state of the United States or the District of
Columbia or any U.S. territory or possession or any other country
or subdivision thereof, in which the business of the Company is
being carried on prior to the Termination Date. Employee agrees
that the places where the business of the Company is being carried
on shall be deemed to include, but are not limited to, places where
the Company has a place of business, has employees, agents or
representatives. The covenants contained in this Paragraph 7(a)
shall be construed as a series of separate and severable covenants
which are identical in terms except for geographic coverage.
b. Employee covenants and agrees that during the period ending
two years after the Termination Date, he will not, directly or
indirectly, hire, solicit, or encourage then-current Company
employees to apply for employment with any person or entity (a)
with which Employee is (or intends to be) employed, (b) by whom
Employee or a firm in which he is employed or has a financial
interest is engaged as a consultant, recruiter, independent
contractor or otherwise, or (c) in which Employee is otherwise
substantially financially interested. Employee further covenants
and agrees that he will not provide to any other person or entity
the names of or references (other than a reference requested by the
Company) on any person who is then employed by the Company.
c. Employee and the Company agree that if in any proceeding, the
tribunal shall refuse to enforce fully any covenants contained
herein because such covenants cover too extensive a geographic area
or too long a period of time or for any other reason whatsoever,
any such covenant shall be deemed amended to the extent (but only
to the extent) required by law.
8. NO ADVERSE COMMENT:
Employee covenants and agrees that after his termination and
through December 31, 2000, he will not, except as specifically
required by law or court process or consented to in writing by
the Company, (i) communicate to any person or entity any adverse
information, written or oral, concerning the Company, its officers,
directors, employees, attorneys, agents or advisers (including
without limitation any communication concerning information
that he acquired while he was employed by the Company and that
concerns or relates to the business, operations, prospects or
affairs of the Company or any of its subsidiaries or affiliates)
under circumstances in which there is a reasonable possibility that
such information might be publicly reported or disclosed or
otherwise made available to the public (regardless of whether the
communication of such information is intended to have or cause that
result or that result is within his control), or (ii) provide to
any person (other than his attorney or accountant) or entity any
information that concerns or relates to the negotiations or
circumstances leading to the execution of this Agreement or to the
terms and conditions hereof or the parties' performance hereunder.
The parties agree that the term "information" as used in this
Section 6 shall have the broadest possible meaning and shall
include matters that are not considered confidential or proprietary
and that constitute beliefs, views and opinions as well as facts.
9. NONDISCLOSURE: Unless otherwise required to do so by law, subpoena
or court order, neither party will in any way communicate or discuss the
terms of this Agreement or the circumstances of Employee's termination
with any person, other than his attorneys and accountants, except only
to say that the matter has been resolved. Employee understands this
nondisclosure provision applies particularly to current and former
employees of the Company and the Company's customers, clients and
vendors.
10. AFFECT ON OTHER AGREEMENTS AND PLANS: Except to the extent
inconsistent herewith or as expressly provided herein and except for
changes resulting from the termination of Employee's employment with the
Company, this Agreement shall have no effect upon the parties'
respective rights and obligations under the Proprietary Rights
Agreement, nor any stock options or other stock rights Employee may have
in the Company, nor any rights Employee has in the Company Profit
Sharing and Thrift Plan.
11. ENTIRE AGREEMENT, AMENDMENT: This Agreement constitutes the entire
agreement between the parties hereto with respect to the subject matter
hereof, and supersedes all prior oral or written agreements, commitments
or understanding with respect to the matters provided for herein. No
amendment, modification or discharge of this Agreement shall be valid or
binding unless set forth in writing and duly executed by the party
against whom enforcement of the amendment, modification, or discharge
was sought.
12. EXECUTION IN COUNTERPARTS: To facilitate execution, this Agreement
may be executed in as many counterparts as may be required; and it shall
not be necessary that the signatures of, or on behalf of, each part, or
that the signatures of all persons required to bind any party, appear on
each counterpart; but it shall be sufficient that all such signatures
appear on one or more of the counterparts. All counterparts shall
collectively constitute a single agreement. It shall not be necessary
in making proof of this Agreement to produce or account for more than a
number of counterparts containing the respective signatures of, or on
behalf of, all of the parties hereto.
13. LIMITATION ON BENEFITS: It is the explicit intention of the
parties hereto that no person or entity other than the parties hereto
shall be entitled to bring any action or to enforce any provision of
this Agreement against any of the parties hereto, and the covenants,
undertakings and agreements set forth in this Agreement shall be solely
for the benefit of, and shall be enforceable only by, the parties hereto
or their respective successors, heirs, executors, administrators, legal
representatives and permitted assigns.
14. BINDING EFFECT: This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective
successors, heirs, executors, administrators, legal representatives and
permitted assigns.
15. SEVERABILITY: If any part of any provision of this Agreement shall
be determined to be invalid or unenforceable by reason of the extent,
duration or geographical scope thereof, or otherwise, then the parties
agree that the court making such determination may reduce such extent,
duration or geographical scope, or other provisions thereof, and in its
reduced form such part or provision shall then be enforceable in the
manner contemplated hereby.
16. GOVERNING LAW: This Agreement and all other disputes or issues
arising from or relating in any way to StorageTek's relationship with
Employee and Employee's termination shall be governed by federal law of
the United States of America and the internal laws of the State of
Colorado, irrespective of the choice of law rules of any state or other
jurisdiction.
17. AMBIGUITIES: The parties acknowledge that they have reviewed this
Agreement in its entirety and have had a full opportunity to negotiate
its terms, and therefore, waive all applicable rules of construction
that any provision of this Agreement should be construed against its
drafter and agree that all provisions of the Agreement shall be
construed as a whole, according to the fair meaning of the language
used.
IN WITNESS WHEREOF, I have read the above agreement, and I voluntarily
sign this Agreement after having been advised to seek my own legal counsel,
without threat or coercion, with full knowledge and understanding of its
contents, and without promise of benefit, except as expressly recited in this
Agreement.
Date EMPLOYEE
STORAGE TECHNOLOGY CORPORATION
By:
Printed Name:
Title:
EXHIBIT A
IBM Corporation
XXX Xxxxxxxxxxx
Sun Microsystems
Hewlett Packard
Data General Corporation
Compac Computers
Sutmyn Corporation
E-Mass Corporation
Any parent or subsidiary corporation of the above listed companies (i.e. any
corporation owning or controlling or which owns or controls, or is controlled
by, either directly or indirectly, more than 50% of the stock of any of the
above corporations.)
EXHIBIT B
SETTLEMENT AND RELEASE
1. In exchange for payment of one year's salary and bonus to
("Employee"), by Storage Technology
Corporation (the "Company") and the release by the Company set forth
below and other good consideration, Employee hereby irrevocably and
unconditionally releases and discharges the Company, its past and
present subsidiaries, divisions, officers, directors, agents, employees,
successors, and assigns (separately and collectively, "releasees")
jointly and individually, from any and all claims, known or unknown,
which he, his heirs, successors or assigns have or may have against
releasees and any and all liability which releasees may have to him
whether denominated claims, demands, causes of action, obligations,
damages, or liabilities arising from any and all bases, however
denominated, including but not limited to, any claims of discrimination
under the Age Discrimination in Employment Act ("ADEA"), the Older
Workers Benefit Protection Act, the Rehabilitation Act, the Family
Medical Leave Act, the Americans with Disabilities Act, Title VII of the
Civil Rights Act of 1964, the Civil Rights Act of 1991 or any federal or
state civil rights act, claims for wrongful discharge, breach of
contract, or for damages under any other federal, state or local law,
rule or regulation, or common law under any theory; provided, however,
that this release does not affect (1) any claims for benefits which have
vested or shall vest on or before December 31, 1998 under any of the
Company's benefit plans; (2) any claims for indemnification for acts of
Employee which have occurred or may occur as on officer or employee of
the Company; or (3) any claims which may arise after the execution of
this Agreement. This release specifically excepts any claim Employee
may wish to make for unemployment compensation, and the Company agrees
not to contest any claim made by Employee for unemployment compensation.
This release is for any relief, no matter how denominated, including,
but not limited to, back pay, front pay, compensatory damages, punitive
damages, or damages for pain and suffering. Employee further agrees
that he will not file or permit to be filed on his behalf any such
claim, will not permit himself to be a member of any class seeking
relief against the releasees and will not counsel or assist in the
prosecution of claims against the releasees, whether those claims are on
behalf of himself or others, unless he is under a court order to do so.
2. In exchange for the release by Employee set forth in paragraph 1 above
and other good consideration, the Company hereby irrevocably and
unconditionally releases and discharges Employee and his heirs,
successors, and assigns (separately and collectively, "releasees"),
jointly and individually , from any and all claims, known or unknown,
which it, its past and present subsidiaries, divisions, officers,
directors, agents, employees, successors, and assigns have or may have
against releasees and any and all liability which releasees may have to
it, whether denominated claims, demands, causes of action, obligations,
damages or liabilities arising from any and all bases, however
denominated, provided, however, that this release does not affect any
claims which are based on releasees' willful acts, gross negligence or
dishonesty in the performance of duties as an employee of the Company,
nor any claims which may arise after the execution of this Agreement.
The Company further agrees that it will not file or permit to be filed
on its behalf any claim against Employee which is released hereby.
3. Employee agrees that by signing this Agreement, he is giving up the
right to xxx for age discrimination, and that under this Agreement
Employee shall receive consideration to which he is not otherwise
entitled, and would not receive but for his release of rights under the
ADEA. Employee has up to twenty-one (21) days after December 31, 1998
to consider whether to sign this Agreement. Employee agrees that, after
he has signed and delivered this Agreement to the Company, this
Agreement will not be effective or enforceable until the end of a seven
(7) day revocation period beginning the day that Employee delivers this
Agreement to the Company, and that Employee will not receive the
severance payment due under the Letter Agreement until this seven-day
period has expired. During this seven-day period, Employee may revoke
this Agreement, without reason and in his sole judgment, but he may do
so only by delivering a written statement of revocation to the Company.
If the Company does not receive a written statement of revocation from
Employee by the end of the revocation period, then this Agreement will
become legally enforceable and Employee may not thereafter revoke this
Agreement.
4. Employee agrees that this Agreement shall be governed by federal law and
the internal laws of the State of Colorado, irrespective of the choice
of law rules of any state.
ACKNOWLEDGMENT:
---------------
Employee's signature below acknowledges that he has read this document fully,
that he understands and agrees to its contents, that he understands that it
is a legally binding document, and that he has been advised to consult a
lawyer of his choosing before signing this Agreement, and has had the
opportunity to do so.
Date EMPLOYEE
STORAGE TECHNOLOGY CORPORATION
By:
Printed Name:
Title:
This Agreement presented to Employee on , 1998.
