SEPARATION AGREEMENT AND RELEASE OF CLAIMS
SEPARATION
AGREEMENT AND RELEASE OF CLAIMS
This
SEPARATION
AGREEMENT AND RELEASE OF CLAIMS
(this
“Release”) is entered into this 29th
day of
January, 2007 by and between nFinanSe Inc. (“Company”) and Xxxxxxxx Xxxxxx
(“Employee”), (each a “Party” or collectively the “Parties”). In consideration
of the promises and commitments made in this Release, the sufficiency and
fairness of which is hereby acknowledged, Company and Employee agree as
follows:
ARTICLE 1
TERMINATION
OF EMPLOYMENT RELATIONSHIP
1.1 Separation
from Company.
Company
and Employee mutually agree that Employee’s employment with Company will
terminate, effective as of the date of this Release. Employee has no further
rights, duties or obligations relating to Company or Released Parties other
than
as set forth in this Release. Employee acknowledges that any and all agreements
relating to Company or Released Parties, including the Employment Agreement
dated October 1, 2005, (the “Employment Agreement”) are hereby cancelled by the
Parties, effective immediately. This Release shall replace all other agreements
relating to Employee, Company and Released Parties (as defined below).
1.2 Return
of Property.
Except
for property that is already in the public domain (such as public records),
Employee will return all Company property in Employee’s possession upon request
and if not specifically requested, on or before Employee’s final date of
employment.
ARTICLE 2
RELEASED
PARTIES
The
Parties intend this Release to benefit and release Company and all entities
and
individuals which are affiliates of Company including, without limitation any
corporation or entity hereafter controlled by, or under the control of, any
of
the above described affiliates or other known affiliates of Company, their
heirs, predecessors, successors, administrators, assigns, and subsidiaries,
and
each of their respective officers, directors, agents, attorneys, and employees
and their heirs, successors, administrators, assigns (collectively, the
“Released Parties”).
The
Parties intend this Release to benefit and release Employee and Employee’s
family members, heirs, and administrators (collectively, the “Employee Released
Parties”).
ARTICLE 3
RELEASE
OF ALL PARTIES
3.1 General
Release.
Employee agrees and understands that Employee is receiving in exchange for
Employee’s promises contained in this Release, something of value to Employee.
Employee has determined that this is a fair exchange. In order for Employee
to
receive this consideration, Employee knowingly and voluntarily releases Released
Parties from every possible claim that Employee can legally waive arising prior
to the date of this Release. This waiver should be construed as broadly as
possible to release all possible claims, debts, obligations, demands, judgments,
or causes of action of any kind whatsoever, whether known or
unknown,
that may be waived. However, for additional clarity, the following is a list
of
some of the types of claims included in this Release: all claims in tort (for
negligent or intentional acts), in contract, by statute, for constitutional
violation, for wrongful discharge, discrimination, harassment, retaliation,
or
claims of personal injury, for compensatory, punitive, or 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
employment with Company or Released Parties, or relating to purported employment
discrimination or violations of civil rights, including, but not limited to,
those arising under Title VII of the Civil Rights Act of 1964, the Civil Rights
Act of 1991, the Civil Rights Acts of 1866 and/or 1871, the Family and Medical
Leave Act (“FMLA”), the Age Discrimination in Employment Act of 1967 (“ADEA”),
the Older Workers Benefit Protection Act, the Americans with Disabilities Act
of
1990 (“ADA”), public and private whistle blower laws, Employee Order 11246, the
Equal Pay Act of 1963, the Rehabilitation act of 1973, the Employee Retirement
Income Security Act of 1974 (“ERISA”), or other benefits laws, or any other
applicable federal, state or local employment discrimination statute or
ordinance or any other claim, whether statutory or based on common law, arising
by reason of Employee’s employment with Company, investment in Company, and
service as a director and officer of Company or the Released Parties, the
separation from that employment or circumstances related thereto or by reason
of
any other matters, cause, or thing whatsoever, from the beginning of time to
the
signing of this Release, and specifically releases any claims that the Released
Parties have any obligation to rehire Employee at any time.
3.2 Age
Discrimination Waiver.
In
exchange for a portion of the payments described in this Release, Employee
hereby knowingly and voluntarily waives and releases all rights and claims,
known and unknown, arising under the Age Discrimination in Employment Act of
1967, 290 U.S.C. §621-634, as amended, and the Older Workers Benefit Protection
Act, which Employee might otherwise have had against any and all of the Released
Parties regarding any aspect of employment with Company up to and including
the
separation from employment and signing this Release.
3.3 Company
Release.
Company
agrees and understands that Company is receiving in exchange for Company’s
promises contained in this Release, something of value to the Company. Company
has determined that this is a fair exchange. In order for Company to receive
this consideration, Company knowingly and voluntarily releases the Employee
and
the Employee Released Parties from every possible claim that Company can legally
waive for actions or inactions by Employee in his capacity as an officer,
director and employee of Company. This waiver should be construed as broadly
as
possible to release all possible claims, debts, obligations, demands, judgments,
or causes of action of any kind whatsoever, whether known or unknown, that
may
be waived.
ARTICLE 4
CONFIDENTIALITY
The
Parties agree that the terms of this Release, including information presented
and made accessible to the Parties as part of their respective consideration
of
this Release, are confidential, and the Parties agree not to divulge such terms,
other than to their accountants, attorneys, Employee’s family and the Internal
Revenue Service or as required by law. The Parties acknowledge that to ensure
compliance with this Release , each Party may disclose this Release to
third-parties to the extent necessary to inform the third-parties of the
disclosing Party’s obligations under this Release. The foregoing covenant not to
disclose shall be binding upon Employee and Company. Employee and Company shall
advise those to whom the
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contents
of this Release are disclosed of this nondisclosure covenant. The agreement
of
the Parties to be bound by the covenants contained herein is indicated by the
Parties’ signature on this Release. The Parties’ signature on this Release also
indicates each Party’s agreement that this provision is an important and
material element of this Release and is given in fair exchange for the
consideration to each Party under this Release.
If
the
law requires any Party to make additional disclosures of confidential
information, the Party required to disclose the information shall provide the
details of such legal requirement(s) to the other Party as soon as possible
and
in advance of the disclosure so that the other Party may make any legal
objections to the disclosure. The Parties agree to work together to produce
a
public announcement and press release concerning Employee’s termination of
employment.
ARTICLE 5
PAYMENTS
5.1 Post
Employment Pay.
In lieu
of the termination payments and accrued vacation payments set forth in the
Employment Agreement, Company shall pay to Employee the sum of $250,000. The
sum
shall be paid in installments as follows:
(a) $30,000
upon the execution of this Release;
(b) $30,000
per month payable monthly for 3 months, with the first payment due on the date
30 days from the date hereof;
(c) $43,333
per month payable monthly for 3 months, with the first payment due on the date
30 days following the final payment provided for in Article 5.1(b)
above.
All
payments are to be made by Company to Employee, less ordinary payroll
withholdings, in accordance with Company’s uniform payroll procedures until the
final payment set forth in Article 5.1(c) has been made; provided, however,
that
in no event will payment under this Article 5.1 be made later than March 15,
2008. The Parties acknowledge that the inclusion of the date of March 15, 2008
in the preceding sentence shall not in any way be construed as an exception
to
the Company’s obligation to make payments to Employee in accordance with the
time periods set forth in subsections 5.1(a), (b) and (c), above.
5.2 Insurance.
Employee shall be entitled to COBRA benefits as required by law.
5.3 Options.
Upon
termination of Employee’s employment, Employee shall be entitled to retain all
vested options to purchase Company stock that Employee possesses as of the
date
of termination, in accordance with the terms of issuance of such options.
Subject to the terms of issuance of said Options, and Employee’s deliverance of
any required opinions, Company shall fully cooperate with, and provide all
necessary assistance to Employee when Employee exercises his options or sells
his shares in the Company, including without limitation executing all documents
necessary to effectuate the exercise of any option or the sale of any shares.
As
of the date of termination, Employee shall no longer be entitled to earn
additional options or vest in additional options under Company’s stock option
plan.
5.4 No
other payments.
Company
shall not make any other payments to or on behalf of Employee, whether in the
form of bonuses, severance, paid time off, profit sharing
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contributions,
or otherwise. Employee agrees that he is not entitled to unemployment
compensation and will not seek unemployment compensation.
ARTICLE
6
POST
EMPLOYMENT COOPERATION
6.1 Post-Employment
Services.
Employee
agrees for a period of two (2) years following the date of this Agreement to
assist Company in any and all reasonable ways, including, but not limited to:
(a) immediately providing any passwords to Company’s Chief Executive Officer;
(b) assisting Company with locating information and property about which
Employee may have knowledge; (c) responding to questions relating to Company
and
Employee’s work as such questions arise; (d) cooperating with Company in the
preparation or defense of any lawsuits or claims relating to work performed
by
Employee or with which Employee had knowledge, including but not limited to
the
Blackstone litigation; and (e) communicating about Company in a positive manner
subject to Employee’s obligation to comply with the law and to cooperate with
governmental authorities.
6.2 Claims.
The
Parties agree that they will not bring any claim, suit, arbitration, or
mediation against any of the Released Parties, Employee or Employee Released
Parties relating to Employee’s employment, separation from employment, or any
other matter occurring prior to the Effective Date of this Release. Nothing
herein prohibits either Party from complying with the law and cooperating with
appropriate governmental authorities.
6.3 Derogatory
Statements.
Subject
to each Party’s obligations to comply with the law and to cooperate with
governmental authorities, each Party shall refrain from making any derogatory
or
negative communications about the other Party, its shareholders, directors,
family members and employees (cumulatively referred to as “Agents”). Subject to
each Party’s obligation to comply with the law and to cooperate with
governmental authorities, all of a Party’s communications about the other Party,
the other Party’s Agents, and Employee’s departure from Company shall be
positive and shall not reflect negatively on Company, Employee or the Agents.
This requirement applies to communications within Company and outside Company
by
Employee and Company. This obligation shall continue indefinitely.
6.4 Ownership
of Information and Products.
Employee agrees that all records, products, documents and all Confidential
Information purchased, possessed or created by any employee or contractor of
Company, including Employee, during employment, or during the performance of
services for Company are owned by and shall be controlled by Company. Except
for
information already in the public domain such as public records, Employee may
not download, copy or retain copies already in his possession of any
information, documents or other property of Company without specific approval
from Company’s Chief Executive Officer; such approval must be obtained for each
such item.
6.5 Company
Cooperation.
For a
period of three (3) months after the date of this Agreement, the Company shall
monitor all email and voice mail communication to Employee and timely forward
any communication not related exclusively to Company business to the Employee.
Company shall provide Employee with a complete copy of his Employment file
within two days after the execution of this Release.
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ARTICLE 7
RESTRICTIVE
COVENANTS
7.1 Protection
of Interests.
Employee has had access to and has been associated with one or more of the
following assets of Company: (a) trade secrets, (b) valuable confidential
business or professional information, (c) prospective or existing clients,
suppliers and other business associates of Company, (d) the goodwill of
Company’s clients, contractors, employees and other business associates, (e)
extraordinary or specialized training or education, and (f) other Confidential
Information (defined below), and Employee might have future access to such
assets. As a result, Employee and Company mutually agree that substantial
business reasons exist for Company to enforce the restrictive covenants set
forth herein.
7.2 Non-Competition
and Non-Interference.
Employee
agrees that for a period of two (2) years following the date hereof, Employee
will not, either as an individual on his own account, or as a partner or joint
venturer, or as an employee, agent, or under the authority of any person or
business entity, investor (other than holding shares listed on a public stock
exchange that do not exceed five percent [5%] of the outstanding shares so
listed), or as an officer, director or stockholder or an employer, without
Company’s Chief Executive Officer’s prior written consent, directly or
indirectly:
(a) Solicit
or contact any clients to attempt to persuade them to cease or reduce the amount
of business they do with Company.
(b) Employ
or
retain, or assist in the recruiting or retaining any individual that that is
currently an employee of Company.
(c) Disclose
to anyone or utilize any Confidential Information to the detriment of Company.
(d) Undertake
any illegal activities or any acts that are not in the best interests of
Company.
(e) Consult
for a direct competitor of Company in a manner that would decrease or diminish
Company’s market share or opportunities.
(f) Consult
with a strategic partner of Company in a manner that would decrease or diminish
Company’s market share or opportunities.
(g) Become
employed by or otherwise provide services to any company whose primary business
is to provide stored value and prepaid credit card services in the United States
of America.
The
Parties acknowledge that no term of this Release shall prevent Employee in
any
way from investing in or serving on the Board of Directors of any of the
following companies: King Technologies, Guardian Meter, Inc., Empower, Inc
and
West Coast Management Solution, LLC provided that such companies are not and
shall not become engaged in activities which would cause Employee to be in
breach of this Article 7.2.
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7.3 The
term
“Confidential Information” shall mean any or all of the following: computer
software; client lists; clients; client and candidate requirements; personnel
data; financial performance and projections; cost data; sales and marketing
plans; and other material or information relating to the proprietary manner
in
which Company does business that are not known to others engaged in similar
businesses or activities.
7.4 Employee
agrees that Confidential Information is and shall at all times remain the sole
and exclusive property of Company, and that any Confidential Information
produced by Employee in the course of direct employment with and for purposes
of
Company shall be the exclusive property of Company.
7.5 The
Parties agree that Company may assign this Release, and any successor-in-charge
shall have the right to full enforcement of this Release provided that it
assumes and satisfies all obligations under the Release.
7.6 Employee
further acknowledges and agrees with Company that the particular matters
referred to in this Release are of such nature that in the event of a threatened
or actual violation thereof, proof of damages would be extremely difficult.
Therefore, in the event of the breach or threatened breach by Employee of the
covenants contained in this Release, Employee agrees that Company shall be
entitled to injunctions, both preliminary and final, enjoining and restraining
such breach or threatened breach and such remedies shall be in addition to
all
other remedies which may be available to Company either at law or in equity.
Company and Employee agree and acknowledge that a violation of the covenants
contained herein shall cause Company to suffer irreparable damages, including
the potential inability of Company to prove specific money damages and Employee
agrees that he is estopped from subsequently asserting in any action to enforce
the provisions of the covenants contained herein that Company has an adequate
remedy at law and therefore is not entitled to injunctive relief.
ARTICLE 8
EFFECT
OF RELEASE
Employee
understands that Employee is not entitled to receive any of the benefits
outlined in this Release if Employee does not sign this Release. Employee
understands that Employee may revoke this Release, within seven (7) days of
signing it. To be effective, the revocation must be in writing and delivered
by
hand-delivery or as described below to Xxxxx X. Xxxxx at Company within seven
days of signing it. If not hand delivered, the revocation must be (i) postmarked
within seven (7) days of signing this Release, (ii) properly addressed as
referenced above; and (iii) sent by certified mail, return receipt requested.
Employee understands that if Employee revokes this Release, as outlined in
this
paragraph, this Release will not be effective or enforceable and Employee will
not be eligible to receive any payments or benefits under this Release. If
Employee delivers a fully executed Release as provided in this Release and
does
not revoke this Release as provided herein, this Release will become effective
on the 8th
day
following delivery of this Release (the “Effective Date”).
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ARTICLE 9
INDEMNIFICATION
Company
agrees to indemnify and hold harmless Employee against any and all losses,
claims, damages, obligations, penalties, judgments, awards, liabilities, costs,
expenses and disbursements (incurred in any and all actions, suits, proceedings
and investigations in respect thereof and any and all legal and other costs,
expenses and disbursements in giving testimony or furnishing documents in
response to a subpoena or otherwise), including without limitation, the costs,
expenses and disbursements, as and when incurred, of investigating, preparing
or
defending any such action, suit, proceeding or investigation (whether or not
in
connection with any action in which Employee is a party), directly or
indirectly, caused by, relating to, based upon, arising out of, or in connection
with Employee’s acting for Company, under the Employment Agreement (or its
predecessor employment agreements), under this Release, or pursuant to
Employee’s service as a director and officer of Company. The indemnification set
forth in this Article 9 does not apply to acts performed by Employee for which
Employee has been criminally indicted.
If
any
action, suit, proceeding or investigation is commenced, as to which Employee
proposes indemnification pursuant hereto, Employee shall provide written notice
to Company with reasonable promptness, but in no event later than 30 days after
having received notice of such action, suit, proceeding or investigation.
Employee’s failure to provide the notice set forth herein shall relieve Company
from its obligations hereunder. Upon receipt of notice of claim of
indemnification by Employee, Company shall retain counsel of Company’s own
choice to represent Employee (subject to the consent of Employee, which consent
shall not be unreasonably withheld or delayed) as long as Company is conducting
a good faith and diligent defense. Company shall pay fees, expenses and
disbursements of such counsel and in the event such counsel fails to conduct
a
diligent and good faith defense, Company shall pay for counsel selected by
Employee to replace such counsel (provided the counsel selected by Employee
is
approved by Company which approval shall not be unreasonably withheld or
delayed). At Company’s expense, Employee and/or counsel selected by Employee
shall at all times have the right to fully participate with the counsel selected
by Company in the defense of a claim against Employee. If the named parties
to
the action or proceeding include both the Company and the Employee and the
Employee is advised that representation of both parties by the same counsel
would be inappropriate under applicable standards of professional conduct,
Employee may engage separate legal counsel at Company’s expense (subject to
Company’s approval which approval shall not be unreasonably withheld or delayed)
Company shall be liable for any settlement of any claim against Employee.
Notwithstanding anything to the contrary contained in this Article 9, Company
shall not settle or compromise any claim, or permit a default or consent to
the
entry of any judgment without the prior written consent of Employee which
consent shall not be unnecessarily withheld or delayed.
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ARTICLE 10
REVIEW
OF RELEASE
10.1 Consultation
with Counsel.
Employee is advised to consult with an attorney prior to signing this Release.
Employee understands that whether or not he does consult with an attorney is
his
decision.
10.2 Review
Period.
Employee has been offered the opportunity to take up to twenty-one (21) days
to
consider this Release. Employee understands that a signed original of this
Release must be received by Xxxxx X. Xxxxx before 5:00 p.m. on the twenty-second
(22nd) day following Employee’s receipt of this document in order for this
Release to be effective. Employee may choose to return this Release at any
time
before that deadline.
ARTICLE 11
MISCELLANEOUS
11.1 Survival.
If any
provision of this Release is declared or determined by any court of competent
jurisdiction to be illegal, invalid, or unenforceable, the legality, validity,
and enforceability of the remaining parts, terms or provisions shall not be
effected thereby, and said illegal, unenforceable, or invalid part, term or
provision, shall be deemed not to be part of this Release.
11.2 Duplicate
Originals.
This
Release may be executed in several counterparts, each of which shall be deemed
an original.
11.3 Headings.
The
headings contained in this Release are for reference purposes only and are
in no
way intended to describe, interpret, define or limit the scope, extent or intent
of this Release or any provisions hereof.
11.4 Representations.
Company
represents and warrants to Employee that as of the date of the Release, to
the
best of Company’s knowledge and belief, no change in control of the ownership
the Company, as defined in U.S. securities laws, has occurred and there have
been no negotiations to sell the Company. In determining whether to execute
this
Release, Employee has not relied on any representations by Company other than
the representations contained in this Article 11.4 and the other representations
contained in this Release.
11.5 Effect.
Nothing
herein shall be construed to release any third parties, other than the Company
and the Released Parties, from claims or actions which Employee may have against
such third parties.
11.6 Effectuating
Release.
Employee hereby agrees to execute any additional documents that may reasonably
be required to facilitate or effectuate this Release. The Parties are unaware
of
the existence of any such need at this time.
11.7 Review
and Understanding.
Employee acknowledges that Employee has received this Release on January
29,
2007 and
has read its terms and understands the terms of this Release.
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11.8 For
Settlement Purposes.
This
Release is entered into in full accord and satisfaction and compromise of the
claims or potential claims of Employee and is not in any way to be construed
as
an admission of any wrongdoing or liability on the part of the Released Parties
or an admission that Released Parties violated any law or breached any
agreement. Company expressly denies any liability or violation and intends
merely to avoid the costs associated with any potential litigation.
11.9 Voluntary.
Employee agrees that Employee executed this Release voluntarily and without
duress, coercion, or undue influence.
11.10 Binding.
This
Release is binding on Employee and Employee’s heirs, administrators, executors,
successors and assigns. If any provision hereof is deemed to be unenforceable
by
a matter of law by a court of competent jurisdiction, then such court shall
have
the right to reform this Release to give maximum effect to its provisions and
the intent of this Release.
11.11 Breach.
Employee’s material breach of this Release shall result in the immediate
cessation of Company’s payment obligations set forth in Article 5, and Employee
shall repay to Company 20% of all amounts received. The portion retained by
Employee shall constitute sufficient consideration for Employee’s remaining
provisions in this Release. Company shall retain the right to seek an injunction
to enforce any provision of this Release. In the event Company materially
breaches this Release, all monies owed to Employee under Section 5.1 of this
Release shall be accelerated and shall be immediately paid to Employee. In
addition, Employee shall be entitled to all remedies available at law and in
equity to enforce the provisions of this Release and to recover all damages
which he has incurred as a result of Company’s breach of the Release.
11.12 Entire
Agreement.
This
Release contains the entire agreement between the Parties. Any prior agreements
or understandings are replaced by this Release. By signing this Release,
Employee acknowledges that Employee has reviewed, understands, and agrees with
each of the terms of this Release and hereby effects this Release.
11.13 Choice
of Law and Venue.
This
Release shall be governed by the internal laws of the State of Florida (without
regard to conflict of laws or similar concepts). Jurisdiction and venue shall
lie, and all legal proceedings shall be brought, in the Twelfth Judicial Circuit
in and for Sarasota County, Florida, or in the United States District Court
for
the Middle District of Florida.
11.14 Section
409A of the Code.
To
the
extent any payment under this Release is deemed to be deferred compensation
subject to the requirements of section 409A of the Internal Revenue Code of
1986, as amended (the “Code”), and the requirements of section 409A of the Code
are not met with respect to such payments, Company may amend this Release so
that such payments will be made in accordance with the requirements of section
409A of the Code. Amendment of this Release to comply with section 409A of
the
Code will not result in Employee being entitled to receive any enhanced benefit
under this Release.
11.15 Cell
Phone Number.
Company
shall transfer to Employee the cell phone number that Employee used while
employed by Company.
11.16 Network
Card.
Employee shall retain at Employee’s expense the Verizon cell number/network card
previously provided by Company to Employee.
IN
WITNESS WHEREOF, the Parties hereto have executed this Release as of the date
first above written.
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WITNESSES
AS TO nFinanSe, INC.
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nFinanSe,
INC.
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|||||
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/s/
Xxxx Xxxxxxxxxx
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By:
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/s/
Xxxxx X. Xxxxx
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||||
|
Xxxxx
X. Xxxxx
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||||||
|
Chief
Executive Officer
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||||||
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WITNESSES
AS TO EMPLOYEE
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XXXXXXXX
X. XXXXXX
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|||||
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/s/
Xxxxxx Xxxxxxx
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/s/
Xxxxxxxx X. Xxxxxx
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|||||
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Date:
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January
29, 2007
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