EXHIBIT 10.24
SEPARATION AGREEMENT AND RELEASE
This Severance Agreement and Release (the "Agreement") is hereby
entered into by and between Childtime Learning Centers Inc. (the "Company") and
Xxxxx X. Xxxxxx ("Employee" or "you"). When used herein the term "Company"
includes any or all current or former affiliated corporations, partnerships,
divisions, subsidiaries, and the officers, directors, shareholders, employees,
agents, attorneys, successors and assigns of the Company.
1. Employment Status. Your employment with the Company will cease on March
26, 2003 (the "Termination Date"). Your regular salary will cease as of
March 28, 2003. You will receive payment of the following: (i) your
salary up to and including March 28, 2003; (ii) four (4) weeks of
accrued, but unused vacation. The Termination Date shall be the date of
the "qualifying event" under the Consolidated Omnibus Budget
Reconciliation Act of 1985 ("COBRA"). You will receive COBRA
information under separate cover.
2. Consideration. In exchange for, and in consideration of, your execution
of this Agreement, the Company will provide you with separation pay
equal to twenty-six (26) weeks of your base pay, which is equal to
$85,000. In addition, the company will provide $10,000 toward an
Executive Outplacement Service or, upon your written request, will
provide you with a $10,000 payment in lieu thereof. All payments made
directly to employee will be subject to applicable federal, state and
local withholding, benefit deductions, payroll and other taxes.
Payment(s) will begin the first full pay period after execution of the
Agreement and after the seven (7) day revocation period explained in
Section 9. If you are currently enrolled in the Company's health
insurance programs, you will be provided with your current or a
similar level of coverage/Company co-payment through December 31,
2003. You will be required to make the applicable co-payment for any
benefit coverage after the end of the severance period if you desire
benefit coverage for the months of October through December 2003. In
the event that benefit plans, insurance carriers, or payroll cycles
change during this transition period, you will be converted to similar
plans, policies, or pay cycles.
3. Settlement of Amounts Due. The amounts set forth in Sections 1 and 2
shall be complete and unconditional payment, settlement, accord and
satisfaction with respect to all obligations and liabilities of the
Company to you, including, without limitation, all claims for wages,
salary, bonuses, vacation pay, capital stock of the Company or rights
to acquire capital stock or other securities of the Company, severance
pay, retention pay, or any other benefits, costs or sums.
4. Release.
(I) In exchange for the consideration described herein, which
is in addition to anything of value to which you are already entitled
to receive from the Company, and other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged by you, on
behalf of yourself and your representatives, agents, estate, heirs,
successors and assigns, absolutely and unconditionally hereby release,
remise and forever discharge the Releasees (defined as the Company, its
parent(s), affiliates, divisions, subsidiaries, successors and assigns,
and its and their respective shareholders, officers, directors,
employees, agents, representatives, and attorneys, in both their
individual and official capacities) from any and all actions or causes
of action, charges, suits, claims, complaints, obligations, contracts,
liabilities, agreements, promises, debts and damages, of any kind or
nature whatsoever, whether existing or contingent, known or unknown,
suspected or unsuspected, in law or in equity, which arise out of your
employment with or separation from employment with the Company. You
agree that this Release is all encompassing and shall act as a full and
total release of any claims that you have or ever had against the
Releasees including from the beginning of your employment to the date
this Agreement becomes effective ("Effective Date"). You agree that
this release of all claims includes, but is not limited to, claims
under any federal, state or local constitution, statute, ordinance,
bylaw or regulation dealing with either employment or employment
discrimination such as those laws or regulations concerning
discrimination on the basis of age, race, color, creed, religion, sex,
sexual harassment, sexual orientation, national origin, ancestry,
marital status, handicap or disability, veteran status,
SS / KD
Initials
1
military service or application for military service, genetic carrier
status; any contract, whether oral or written, express or implied; any
tort; and any common law.
(II) You further agree to release and discharge the Releasees
from any and all claims which might be made by any other person or
organization on your behalf and you specifically waive any right to
become, and promise not to become, a member of any class in a case in
which a claim or claims against the Company are made involving any
matters subject to release pursuant to this Section.
(III) Waiver of Rights and Claims Under the Age Discrimination in
Employment Act of 1967.
Since Employee is 40 years of age or older, Employee has been informed
that Employee has or might have specific rights and/or claims under the
Age Discrimination in Employment Act of 1967 ("ADEA") and Employee
agrees that:
(a) In consideration of the payments described in Section 2 hereof,
which is in addition to anything of value to which Employee already may
be entitled, Employee specifically waives such rights and/or claims to
the extent that such rights and/or claims arose prior to or on the date
this Agreement was executed;
(b) Employee understands that rights or claims under the ADEA that
may arise after the date this Agreement is executed are not waived by
Employee;
(c) Employee hereby is and was advised of his/her right to consult with
his/her counsel of choice prior to executing this Agreement and
Employee acknowledges that he/she has not been subject to any undue or
improper influence interfering with the exercise of Employee's free
will in executing this Agreement;
(d) Employee has carefully read and fully understands all of the
provisions of this Agreement, and Employee knowingly and voluntarily
agrees to all of the terms set forth in this Agreement;
(e) In entering into this Agreement Employee is not relying on any
representation, promise or inducement made by the Company or its
attorneys with the exception of those promises described in this
document; and
(f) Employee also agrees not to initiate any legal action, charges or
complaints against the Company in any forum whatsoever, in connection
with the claims released by him/her pursuant to this section.
5. Period for Review and Consideration of Agreement.
(I) When the Company presented Employee with this Agreement,
Employee was informed that she/he has 21 days to review this Agreement
and consider its terms before signing it.
(II) The 21-day review period will not be affected or extended
by any revisions, whether material or immaterial, that might be made to
this Agreement.
(III) The Company expressly denies that it has violated any
law, statute, ordinance, contract, duty or obligation whatsoever, or
that it committed any tort or engaged in any wrongful conduct. The
Company acknowledges that the consideration described in this Agreement
is in excess of that to which Employee was otherwise entitled upon
his/her termination under either applicable law or Company policy.
6. Proprietary and Company Materials. On or before the Termination Date, you
will return to the Company all proprietary and Company property, equipment,
and materials, including but not limited to, credit cards, personal
computers, memoranda, sales brochures, manuals, building keys and passes,
courtesy parking passes, names and addresses of all Company customers and
potential customers, customer lists, customer contacts, customer
information and/or data, sales or financial information, diskettes,
intangible information stored on diskettes, business or marketing plans,
reports, projections, software programs and data compiled with the use of
those programs, tangible copies of trade secrets and confidential
information, and any and all other information or property previously or
currently held or used by you that is
SS / KD
Initials
2
or was related to your employment with the Company. You agree that in the
event that you discover any other Company or proprietary materials in your
possession after the Termination Date, you will immediately return such
materials to the Company.
7. Non-Disparagement and Confidentiality. You agree not to misappropriate,
divulge or communicate, directly or indirectly, any confidential and/or
proprietary information, including trade secret information, of the Company
or any third party associated with the Company. You further agree not to
disparage the business, any employees or past employees, operations,
technologies, products, services, marketing strategies, pricing policies,
management, affairs and financial condition of the Company. You also agree
that you shall not divulge or publish, directly or indirectly, any
information whatsoever regarding the substance, terms or existence of this
Agreement and/or any discussions or negotiations relating to this
Agreement, to any person or organization other than your attorneys,
accountants, financial advisors or members of your immediate family.
Nothing herein shall prohibit or bar you from providing truthful testimony
in any legal proceeding or in communicating with any governmental agency or
representative or from making any truthful disclosure required, authorized
or permitted under law; provided however, that in providing such testimony
or making such disclosures or communications, you will use your best
efforts to ensure that this Section is complied with to the maximum extent
possible.
8. Post-Employment Obligations.
(I) You agree that for the period of eighteen (18) months
following the Termination Date, you will not, in any manner, hire or
engage, or assist any company or business organization by which you are
employed or which is directly or indirectly controlled by you to hire
or engage, any person who is employed by the Company (or is an agent,
representative, contractor or consultant of the Company) at any time
during your employment with the Company or during the period of
eighteen (18) months thereafter.
(II) You agree that during the period of eighteen (18) months
following the Termination Date, you will not solicit, recruit or
induce, in any manner, any person who is employed by the Company (or is
or was an agent, representative, contractor or consultant of the
Company) at any time during your employment with the Company, or during
the period of eighteen (18) months thereafter, to leave his or her
employment or engagement with the Company.
(III) You agree that during the period of eighteen (18) months
following the Termination Date, you will not solicit or do business
with any client of the Company about whom you obtained information, or
became familiar with through confidential information, during your
employment with the Company.
(IV) You agree that for twelve (12) months following the
termination of your employment with Childtime that you shall not,
within any state in which Childtime operates, directly or indirectly,
own, manage, operate, join, control, or participate in, or be connected
with, as an officer, employee, agent, partner, director, or otherwise,
of any business, individual, partnership, firm, or corporation
(collectively "Entity") that is at the time engaged principally or
significantly in a business which is in substantial direct competition
with Childtime, or any subsidiary or affiliate of Childtime. Nothing
herein, however, shall prohibit Employee from acquiring or holding any
issue of stock or securities of any Entity that has any securities
listed on a national securities exchange or quoted on the daily listing
of over-the-counter market securities, provided that at any one time
Employee and the members of her immediate family do not own more than
one percent of any voting securities of any such Entity.
(V) You agree to cooperate with Childtime in the conduct
and defense of any litigation, criminal or civil, administrative
proceeding, investigation, or arbitration. Cooperation includes, but is
not limited to, meeting with Childtime's attorneys; providing documents
and information in your, or your agent's, possession; and making
yourself available to testify on behalf of Childtime or any parent,
subsidiary, or affiliate of Childtime. You agree not to discuss,
comment, give, or prepare any writing involving any issue arising out
of any litigation, administrative proceeding, investigation, or
arbitration in which Childtime is or shall become involved without
first having been so authorized by the President of Childtime in
writing or by virtue of process issued by a court of competent
jurisdiction. In the event that you are issued process by a court of
competent jurisdiction, you will immediately
SS / KD
Initials
3
inform Childtime, and if requested, meet with Childtime's attorneys
before discussing, testifying, commenting, giving or preparing any
writing, in which Childtime is involved. Childtime agrees to reimburse
you, on an after tax basis, for all reasonable expenses incurred in
connection with your cooperation with Childtime in the conduct and
defense of any litigation, criminal or civil, administrative
proceeding, investigation, or arbitration.
You also agree that you will cooperate with Childtime, on an as needed
basis, for the six (6) months following the termination of your
employment with Childtime, to assist Childtime with any issues,
questions, or inquiries connected with your employment with Childtime
or Childtime's business. You will not be reimbursed for any of your
time or expenses incurred in connection with your cooperation pursuant
to this paragraph.
9. Representations and Governing Law.
(I) This Agreement represents the complete and sole
understanding between the parties concerning the subject matter hereof,
and supersedes any and all other agreements and understandings, whether
oral or written, concerning the subject matter hereof. Employee
represents that he/she is not relying upon any representation,
statement, or promise not set forth in this Agreement.
(II) If any provision of this Agreement, or part thereof, is
held invalid, void or voidable as against the public policy or
otherwise, the invalidity shall not affect other provisions, or parts
thereof, which may be given effect without the invalid provision or
part. To this extent, the provisions, and parts thereof, of this
Agreement are declared to be severable. Moreover, if one or more of the
provisions contained in this Agreement shall for any reason be held to
be excessively broad as to scope, activity, subject or otherwise so as
to be unenforceable at law, such provision or provisions shall be
construed by the appropriate judicial body by limiting or reducing it
or them, so as to be enforceable to the maximum extent compatible with
the applicable law as it shall then appear. Any waiver of any provision
of this Agreement shall not constitute a waiver of any other provision
of this Agreement unless expressly so indicated otherwise.
(III) The failure of either party to insist upon strict
adherence to any term of this Agreement on any occasion shall not be
considered a waiver thereof or deprive such party of the right
thereafter to insist upon strict adherence to that term or any other
term of the Agreement. Company reserves the right to seek appropriate
damages, including attorneys' fees and injunctive relief, should
Employee violate this Agreement.
(IV) The validity, interpretation, and performance of this
Agreement shall be construed and interpreted according to the laws of
the State of Michigan, without giving effect to the principles of
conflicts of law thereof.
(V) You may not assign any of your rights or delegate any of
your duties under this Agreement. The rights and obligations of the
Company under this Agreement shall inure to the benefit of the
successors and assigns of the Company.
(VI) Employee acknowledges that he/she is fully aware
of this Agreement's contents and of its legal effects. Employee also
hereby acknowledges that he/she has been advised by the Company of
her/his right to consult with an attorney regarding this Agreement
prior to its execution. Employee understands her/his right to have this
Agreement reviewed by an attorney and acknowledges that the Company has
advised and encouraged her/him to consult with an attorney so that she
is fully aware of her rights and obligations under this Agreement.
Employee has twenty-one (21) days from the date he/she receives this
Agreement to sign it and return it to the Company. In the event
Employee signs this Agreement, he/she shall have seven (7) days
thereafter to revoke this Agreement. A revocation must be in writing
and delivered to the person who executed this Agreement on behalf of
the Company. If this Agreement is not revoked within the seven (7) day
period, it will be fully enforceable without any further affirmative
action by any party.
SS / KD
Initials
4
(VII) This Agreement has been executed freely, knowingly and
voluntarily by Employee without duress, coercion, or undue influence,
with a full and free understanding of its terms. This Agreement
supercedes all prior oral and written agreements, if any, with respect
to the subject matter hereof between the parties. This Agreement may
not be changed except in writing and signed by both Employee and an
authorized officer of the Company.
YOU REPRESENT THAT YOU HAVE READ THE FOREGOING AGREEMENT, FULLY UNDERSTAND THE
TERMS AND CONDITIONS OF SUCH AGREEMENT, AND ARE VOLUNTARILY EXECUTING THE SAME.
IN ENTERING INTO THIS AGREEMENT, YOU DO NOT RELY ON ANY REPRESENTATION, PROMISE
OR INDUCEMENT MADE BY THE COMPANY, WITH THE EXCEPTION OF THE CONSIDERATION
DESCRIBED IN THIS DOCUMENT.
/s/ Xxxxx X. Xxxxxx /s/ Xxxxx X. Xxxxx
------------------------------- -------------------------------------
Xxxxx X. Xxxxxx Childtime Learning Centers Inc.
Dated: April 14, 2003 By: Xxxxx X. Xxxxx
------------------------ ---------------------------------
Title: V.P. Human Resources
-------------------------------
Dated: April 24, 2003
-------------------------------
SS / KD
Initials
5
Waiver of 21 Day Review Period
I, Xxxxx X. Xxxxxx acknowledge that I was informed and understand that
I have 21 days within which to consider the attached Separation Agreement and
Release, have had the opportunity to consult with an attorney regarding such
Agreement and have considered carefully every provision of the Agreement, and
that after having engaged in those actions, I prefer to and have requested that
I enter into the Agreement prior to the expiration of the 21-day period.
Dated: April 15, 2003 Employee /s/ Xxxxx X. Xxxxxx
------------------------------ -----------------------------
Dated: April 15, 2003 Witness /s/ Xxxxxxxx Xxxxxx
------------------------------ -----------------------------
SS / KD
Initials
6
