SETTLEMENT AGREEMENT AND GENERAL RELEASE
INSTRUCTIONS TO EMPLOYEE: THIS IS AN IMPORTANT LEGAL
DOCUMENT. FOR THAT REASON, YOU ARE ADVISED THAT:
YOU HAVE THE RIGHT TO CONSULT WITH AN ATTORNEY, AND YOU SHOULD CONSULT
WITH AN ATTORNEY, BEFORE SIGNING.
YOU HAVE UP TO TWENTY-ONE (21) DAYS TO CONSIDER THIS AGREEMENT. AFTER
SIGNING THE AGREEMENT, YOU MAY REVOKE THE AGREEMENT WITHIN SEVEN (7)
DAYS. THE AGREEMENT WILL BECOME EFFECTIVE SEVEN (7) DAYS AFTER YOU SIGN
IT.
Xxxx Xxxxxxxxx ("Xxxxxxxxx") and Tandem Computers Incorporated
("Tandem") entered into an employment agreement dated as of May 19, 1995 (the
"Agreement"). As of January 1, 1996, Xxxxxxxxx and Xxxxxx entered into an
amendment to the Agreement (the "First Amendment"). As of May 2, 1996, Xxxxxxxxx
and Xxxxxx entered into a second amendment to the Agreement (the "Second
Amendment"). The Agreement, as amended, is hereinafter referred to as the
Amended Agreement. This Settlement Agreement and General Release (the "Release")
is being entered into pursuant to the requirements of Section 5 of the Amended
Agreement.
Accordingly, for and in consideration of the commitments set forth
herein and in the Amended Agreement, Xxxxxxxxxx and Xxxxxx agree as follows:
1. Xxxxxx and Xxxxxxxxx agree (I) that Xxxxxxxxx'x employment with
Xxxxxx will terminate effective as of April 30, 1997 ("Date of Termination"),
(ii) that such date was the last day of Xxxxxxxxx'x Period of Employment with
Tandem for purposes of the Amended Agreement, and (iii) that Xxxxxxxxx will not
be entitled to any of the benefits of any employee benefit program of Tandem
accruing after said date except as set forth in the Amended Agreement.
2. Pursuant to section 5 of the Amended Agreement, the Parties agree
that for purposes of the Amended Agreement, the termination of Xxxxxxxxx'x
employment shall be treated as if Tandem terminated the Period of Employment
Without Cause (as such terms were used in the Amended Agreement).
3. Within thirty (30) days of the execution and delivery of this
Release, Tandem will take the following actions and shall pay Xxxxxxxxx the
following amounts in full satisfaction of any and all obligations of Tandem
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under the Amended Agreement:
(a) Pursuant to, and in full satisfaction of, sections
5.02(d)(i),(iii), and (vi)of the Amended Agreement, Tandem shall pay Xxxxxxxxx
the sum of one million, nine hundred seventy nine thousand dollars
($1,979,000.00).
(b) Pursuant to, and in full satisfaction of, section
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5.02(d)(ii) of the Amended Agreement, Tandem shall pay Xxxxxxxxx a pro-rated
annual bonus for the fiscal year in which termination occurs, for the portion of
the fiscal year prior to the date of termination, based on Tandem's performance
through the end of the fiscal quarter in which termination occurs (October 1,
1996 through June 30, 1997.)
(c) Pursuant to, and in full satisfaction of, section
5.02(d)(vii) of the Amended Agreement, Tandem shall pay for outplacement
counseling services for Xxxxxxxxx up to a maximum of thirty five thousand
dollars ($35,000.00).
(d) Pursuant to, and in full satisfaction of, section 2(B) of
the Second Amendment, the Parties agree that Xxxxxxxxx'x rights under his
outstanding stock options will be determined under the terms of the applicable
plans and agreements, except that all of Xxxxxxxxx'x stock options which are
vested at the time of the Termination Date will remain outstanding and may be
exercised at any time on or before (i) the third anniversary of his termination
of employment or (ii) the original expiration date of the applicable stock
option, whichever occurs first.
(e) Pursuant to, and in full satisfaction of, section 5.02(d)
(iv) and (v) of the Amended Agreement, Tandem shall pay Xxxxxxxxx the sum of
seventy six thousand, six hundred eleven dollars ($76,611.00).
4. Except as provided in the Amended Agreement and by any
indemnification agreement or by-law applicable to Xxxxxxxxx in his capacity as
an employee, officer or a director of Tandem or pursuant to California Labor
Code Section 2802 or similar provision of law, Xxxxxxxxx, his representatives,
heirs, successors and assignees, do hereby completely release and forever
discharge Tandem and its parent, affiliated and subsidiary corporations, and
their shareholders, officers, directors, agents, employees, attorneys,
successors and assigns (referred to hereinafter collectively as "Tandem") from
all claims, rights, demands, actions, obligations, liabilities and causes of
action of any and every kind, nature and character whatsoever, known or unknown,
which Xxxxxxxxx may now have or has ever had against Tandem including, without
limitation, those arising from or in any way connected with the employment of
Xxxxxxxxx by Tandem or termination thereof, whether based on tort, contract or
any federal, state or local law, statute or regulation, including but not
limited to any claims Xxxxxxxxx may have under the federal Age Discrimination in
Employment Act (29 U.S.C. Section 621, et seq.) or the California Fair
Employment and Housing Act. It is understood and agreed that Xxxxxxxxx'x rights
to indemnification under Xxxxxx's by-laws shall be determined under Xxxxxx's
by-laws as in effect on the date hereof, or as such by-laws may be amended from
time to time hereafter to the extent any such amendment provides broader
indemnification rights than were provided before such amendment. It is further
understood that this Agreement and General Release supersedes the Amended
Agreement between Xxxxxxxxx and Xxxxxx from which Xxxxxxxxx releases all claims,
rights, demands, actions, obligations, liabilities and causes of action of any
kind.
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5. Xxxxxxxxx further agrees that he will not file, in any court or with
any governmental agency, any action, claims or charge against Tandem arising
from or in any way connected with his employment with Tandem, including, without
limitation, the termination thereof, except to enforce his rights under the
Amended Agreement or under any indemnification agreement or by-law applicable to
Xxxxxxxxx in his capacity as an employee, officer or director of Tandem or
pursuant to California Labor Code Section 2802 or similar provision of law.
6. It is understood and agreed that this is a full and final release
covering all known, unknown, anticipated, and unanticipated injuries, debts,
claims, or damages to Xxxxxxxxx which may have arisen or may be connected with
the employment of Xxxxxxxxx by Xxxxxx or the termination thereof. Xxxxxxxxx
hereby waives any and all rights or benefits which he may now have, or in the
future may have, under the terms of Section 1542 of the California Civil Code
which provides as follows:
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 release, which if known by him must have
materially affected his settlement with the debtor.
In that regard, Xxxxxxxxx hereby acknowledges that he may have
sustained losses which are presently unknown or unsuspected, that such damages
and other losses as were sustained may give rise to additional complaints,
actions, causes of action, claims, demands and debts in the future.
Nevertheless, he acknowledges that this Release has been negotiated and agreed
upon in light of this realization and, being fully aware of this situation, he
does nevertheless intend hereby to release, acquit and forever discharge Tandem
from any and all such unknown claims including damages which are unknown or
unanticipated, except as provided in Paragraphs 3 and 4 above.
7. Xxxxxxxxx hereby agrees that he accepts the termination of his
employment with Xxxxxx and that he shall not seek reinstatement or reemployment
with Xxxxxx at any time. Xxxxxxxxx expressly waives any and all rights he may
have to reemployment with Xxxxxx.
8. It is understood and agreed that except to the extent disclosed by
Xxxxxx, the Amended Agreement and this Release, and each and every provision
thereof and hereof, shall be confidential and shall not be disclosed by
Xxxxxxxxx to any person, firm, organization or entity, of any and every type,
public or private, for any reason without the prior written consent of Tandem,
unless required by law.
9. Xxxxxxxxx agrees to hold all Proprietary Information in confidence
and not to, directly or indirectly, disclose, use, copy, publish, summarize, or
remove from Tandem any Proprietary Information except as specifically authorized
in writing by Xxxxxx. As used in this paragraph, "Proprietary Information" means
any information in whatever form, tangible or intangible, directly related to
the business of Tandem or any affiliated company of Tandem, unless: (i) the
information is or becomes publicly available through lawful means, (ii) the
information was rightfully in Xxxxxxxxx'x possession, or part of his general
knowledge, prior to his employment by Xxxxxx, or (iii)
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the information is disclosed to Xxxxxxxxx without confidential or proprietary
restriction by a third party who rightfully possesses the information (without
confidential or proprietary restriction) and did not learn of it, directly or
indirectly, from Tandem.
10. It is understood and agreed that this is a compromise settlement of
a disputed claim, or disputed claims, and that the furnishing of the
consideration of this Release shall not be deemed or construed at any time or
for any purpose as an admission of liability by Xxxxxx. The liability for any
and all claims is expressly denied by Xxxxxx.
11. Xxxxxxxxx and Xxxxxx agree that they have had the opportunity to be
represented in the negotiation of this Release by individuals of their own
choosing, that they have read this Release and fully understand its legal
effect, that this Release contains all of the promises which they have made, and
that they are entering into this Release freely and not on the basis of promises
which are not stated in this Release. Xxxxxxxxx specifically acknowledges that
he has been advised to consult an attorney regarding the terms of this Release.
Xxxxxxxxx further acknowledges that he has had at least twenty-one (21) days to
consider and evaluate the terms of this agreement and that he understands that
this Release is revocable for seven (7) days after its execution.
12. Any dispute between Xxxxxxxxx and Xxxxxx arising from Xxxxxxxxx'x
employment with Xxxxxx, including termination thereof, and any dispute as to the
violation of any provision of this Release shall be resolved by arbitration,
which arbitration shall be conducted in accordance with the provisions of
Section 7.11 of the Amended Agreement.
13. This Release shall not be construed as an admission by Xxxxxx or
Xxxxxxxxx of any violation of law, or breach of any legal or contractual duties,
or of any other improper conduct by Xxxxxx, Xxxxxxxxx or anyone else.
14. The terms of this Release shall be governed by the laws of the
State of California. In the event that any term of this Release shall be found
to be null or void, the remaining terms shall continue to have full force and
effect.
Dated: 5/27/97 /s/ Xxxx Xxxxxxxxx
______________________________________
Xxxx Xxxxxxxxx
Dated: 5/27/97 Tandem Computers Incorporated
/s/ Xxxx Xxxxxxx
By:___________________________________
Xxxxxx Xxxxxxx
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