EXHIBIT 10.34
AMENDED SEPARATION AGREEMENT AND RELEASE
This Agreement is entered into effective May 14, 1999, by and between Xxx
Xxxxx ("Stack") and Tanning Technology Corporation, a Colorado corporation
("Tanning"), with offices at 0000 X. Xxxxxx Xxxxxx, Xxxxx 000, Xxxxxx, Xxxxxxxx
00000.
Whereas, Stack and Tanning have entered into a Separation Agreement and
Release dated as of May 14, 1999 (the "Previous Agreement"); and
Whereas, the parties now wish to substitute this Agreement for the Previous
Agreement, with the intent that the Previous Agreement will be void ab initio,
and this Agreement will be the sole agreement between the parties with respect
to the subject matter herein.
Now therefore, in consideration of the covenants set forth herein, the
parties agree as follows:
1. Resignation by Stack. Stack hereby resigns his employment with Tanning
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as of Friday, May 14, 1999. He freely and knowingly grants this Release
effective May 14, 1999.
2. Compensation. In consideration of this Release, Tanning agrees to the
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following provisions:
A. Pay Continuation. Stack will continue to receive a semi-monthly
pay rate of Nine Thousand Dollars ($9,000.00), less state and federal taxes and
other legal standard deductions through Monday, January 31, 2000 (the "Pay
Continuation Period"). The pay continuation terms also include a one-time lump
sum payment of Ten Thousand Dollars ($10,000.00), less state and federal taxes
and other legal standard deductions payable immediately.
B. Expenses to San Francisco Bay area. Tanning agrees to pay, on a
pretax basis, Stack's moving expenses for household goods from Denver, Colorado
to the San Francisco Bay metropolitan area if Stack chooses to relocate back
within the 12-month period ending May 15, 2000. In the event Stack accepts a
position that includes relocation expenses, Tanning will only cover move
expenses that exceed amounts covered by a subsequent employer.
C. Vesting Credit Continuation. Tanning will continue to allow Stack
to earn vesting credit for his existing stock options on 175,000 shares both
during and after the Pay Continuation Period on the condition that Stack fully
complies with the terms of this Agreement, including but not limited to the non-
disparagement requirements set forth in Section 8 below and the non-solicitation
requirements set forth in Section 9 below. Vesting credit eligibility will
continue through 11/17/01, at which time Stack will have completed the vesting
requirements for 175,000 shares. All other options as granted in Stack's 1999
Sales Management Compensation Plan held by Stack are immediately forfeited.
D. Stock Option Continuance. Subject to Sections 5 & 8, Tanning will
postpone the 90-day vested stock option post-termination exercise provision
relating to employment termination. Stack may continue to hold his vested stock
options (175,000 shares vested effective 11/17/01) for a period not to exceed
one year. For the period 11/17/01 through 11/17/02 vested options will remain
exercisable as set forth in the company's stock option plan. Unexercised options
expire on 11/17/02.
E. Vacation Accrual. Any accrued and unused vacation as of May 14,
1999, will be paid to Stack at the end of the Pay Continuation Period (by
December 31st) in one lump sum, less state and federal taxes and other legal
standard deductions. Tanning agrees to pay Stack for 11 days of accrued vacation
at a daily rate of $461.54 per day (annual salary divided by 260 days). Tanning
agrees to provide payment for Stack's vacation accrual in the amount of Five
Thousand, Seventy-Seven dollars ($5,077.00) on or before December 31, 1999
(based on the 15-day annual vacation allowance specified in Stack's employment
agreement, this balance represents 5 days of unused 1998 vacation, and 6 days of
unused 1999 vacation.)
F. Outplacement Expense Reimbursement. Tanning will reimburse Stack
for up to $2,000 of outplacement expenses upon Stack's submission of related
receipts.
G. Benefits Coverage. Group life, medical and dental insurance
benefits will continue to be provided to Stack through Monday, January 31, 2000.
At the end of the Pay Continuation Period, Stack understands that COBRA
continuation rights will be available to him for an additional 18-month period
pursuant to federal law. Stack agrees to notify Tanning within 60 days of the
end of the Pay Continuation Period in order to exercise his right to continue
COBRA benefit coverage. Stack agrees to pay the monthly premiums due pursuant to
the standard COBRA policies of Tanning. Tanning's obligations under this
paragraph G. cease when Stack becomes eligible to participate in a subsequent
Tanning's medical plan.
H. Work Expectations During the Pay Continuation Period. During the
Pay Continuation Period Stack agrees to work such hours and on such projects,
including providing information on work done and client contacts made during his
employment with Tanning, as are reasonable and agreed upon between Tanning and
Stack. In no cases will Stack's work activities with Tanning jeapordize full-
time employment positions with another company accepted by Stack. The intent is
to part company on a friendly and dignified basis following the Pay Continuation
Period. At the end of the Pay Continuation Period (January 30, 2000), Stack will
be released from any additional obligations to provide services to Tanning other
than what is mutually agreed to in writing between himself and Tanning. Stack
will return his company issued computer equipment, pager, cellular telephone,
credit card, Metropoint facilities access cards, any Tanning files, and any and
all other Tanning property in his possession, on Friday, May 14, 1999. Stack
also agrees to be strictly governed by the non-disclosure contained in his
Employment Agreement.
I. Tanning agrees to reimburse Stack for expenses incurred in direct
support of his job responsibilities. Given that Stack is released from day-to-
day job responsibilities effective Friday, May 14, 1999 it is expected that
business expenses incurred will end effective May 14.
J. General Communications. Stack agrees to not transmit internal
communication messages regarding his employment status. Tanning agrees to
characterize his work period at Tanning as helpful and related to the
development of a sales function at Tanning.
K. No Waiver. No vesting credits under Tanning's 401(k) Plan will
accrue after the Pay Continuation Period ends on January 31, 2000. Stack
understands that he is not waiving any rights to vested employee benefits
extended under such Plan.
3. Release. In consideration for the promises, agreements and covenants
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contained herein, Stack hereby fully releases, acquits and fully and forever
discharges Tanning and its predecessors, successors, assigns, agents, officers,
employees, directors, shareholders, legal representatives, and affiliated
companies from any and all liability, claims, charges, demands, attorneys' fees,
costs, suits in equity or causes of action, of whatever kind and nature, whether
known or unknown, which have or could be asserted against Tanning arising out of
or in any way relating to his employment with and/or termination of employment
from Tanning and/or any other occurrence whatsoever arising on or before the
date this agreement is executed, including but not limited to:
A. Alleged violations of any statute or regulation, including but not
limited to the Civil Rights Act of 1991, Title VII of the Civil Rights Act of
1964, The Employee Retirement Income Security Act, Title 00 X.X. Xxxxxxx 0000,
the Colorado Civil Rights Act, the Americans with Disabilities Act, the Age
Discrimination in Employment Act, 29 U.S.C. (S)62 1, et seq. and/or any other
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federal, state or local statute, ordinance, or regulation dealing in any way
with employment or employment discrimination.
B. Any breach of an expressed or implied employment contract under
the common law of the State of Colorado, or any other state, or on the basis of
any claim of defamation, wrongful discharge and/or any other common law,
statute, and/or tort (including any claim for pain and suffering or emotional
distress) and/or any other claim whatsoever arising out of or in any way
relating to his employment and/or termination of
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employment from Tanning and/or any other occurrence prior to the date of this
Agreement and through and including the Pay Continuation Period, but excluding
claims for breach of this Agreement.
4. Authority. Stack warrants that he is legally competent to execute this
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Release and accept full responsibility therefor.
5. Confidentiality. Stack acknowledges that he has signed an Employment,
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Confidentiality, and Non-Competition Agreement and Employee Appendix, with
Tanning dated November 17, 1997 (collectively, the "Employment Agreement") and
that the terms and conditions of the Employment Agreement remain in effect and
will continue to be binding on Stack. Stack agrees that all information, facts
or occurrences relating to: (1) all negotiations leading to this Agreement; (2)
the existence and contents of this Agreement; and (3) all formulas, processes,
customer lists, computer user identifiers and passwords, and all purchasing,
engineering, accounting, marketing and other information, not generally known
and proprietary to Tanning, relating to research, development. manufacturing,
marketing or sale of Tanning's products shall be and are hereby deemed to be
Tanning Trade Secrets and/or Confidential Information under the Employment
Agreement.
6. Reasonable Terms. Stack acknowledges that the provisions of this
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Agreement are reasonable and necessary for the protection of Tanning and that
his violation of this Agreement will cause Tanning irreparable harm for which it
will be entitled to temporary and permanent injunctive relief, money damages
insofar as they can be determined and all related costs and reasonable
attorneys' fees. This Agreement may be pleaded as a full and complete defense to
any action, suit or other proceeding which may be instituted, prosecuted or
attempted for, upon, or in respect of any of the claims released hereby.
7. Full Release, Denial of Liability. Stack understands that this Release
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is a compromise and final settlement of disputed claims and fully discharges
Tanning from any further obligation. Stack agrees that Tanning's payment of the
settlement amount shall not be construed to be an admission by Tanning of any
liability whatsoever in connection with his employment by Tanning or any other
transaction between the parties hereto, and he understands that Tanning
expressly denies any liability. Stack agrees that the amount of Tanning's
payment to him is reasonable and fair for this Release.
8. Non-Disparagement. In consideration of this Release, Stack agrees to
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refrain from making statements, publicly or otherwise, orally or in writing
which are defamatory or adverse to the interests of Tanning, its employees or
contractors, products, work methods, employment practices, business practices or
business relationships. Stack agrees that he shall not in any way assist or
encourage any individual or group of individuals to bring or pursue a lawsuit,
charge, complaint, or grievance, or in making any other demands against Tanning.
In addition to the other rights and remedies of Tanning, in the event a
disparaging act is committed by Stack as defined above, the opportunity for
additional vesting credit for unvested options will terminate immediately and
all vested options will be subject to a 60 day exercise requirement commencing
effective on the date the breach occurs.
9. Non-Solicitation of Clients & Employees. Stack shall not (1) during the
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period that he is subject to the restrictions set forth in 8 above, hire or
solicit the employment or services of any person who is an employee or
consultant of Tanning or its successors or assigns, or (2) for a 12 month period
commencing May 15, 1999 and continuing through May 14, 2000 directly or
indirectly solicit business competitive with Tanning's then current business
from any customer or client which is currently under contract with Tanning. The
above shall not prohibit the Stack from using the services of any such person in
a way that clearly does not compete with the business of Tanning. In addition
to the other rights and remedies of Tanning, in the event that Stack breaches
the covenants of this section as defined above, the opportunity for additional
vesting credit for unvested options will terminate immediately and all vested
options will be subject to a 60 day exercise requirement commencing effective on
the date the breach occurs. The time periods set forth above shall be extended
for any period of time that Stack is found to be in violation of any provision
of this Section.
10. Amendments. This Agreement may not be amended or modified in any
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respect except by a written instrument duly executed by all of the parties to
this Agreement.
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11. Construction. This Agreement has been and shall be construed to have
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been drafted by all the parties to it so that the rule of construing ambiguities
against the drafter shall have no force or effect.
12. Severability. If any portion or term of this Agreement is held
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unenforceable by a court of competent jurisdiction, the remainder of this
Agreement shall not be affected and shall remain fully in force and enforceable.
13. Acknowledgement and Receipt and Consult Counsel. Stack acknowledges
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that he has been encouraged by Tanning to seek the advice of legal counsel and
that he has done so or determined not to do so of his own accord. Stack
acknowledges that he understands the legal significance and effect of this
Agreement and represents that the terms of this Agreement are fully understood
and accepted by him.
14. Binding Date of Agreement. Stack acknowledges that he may revoke this
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Agreement within seven (7) days after the execution hereof by delivering written
notice of his desire to revoke, along with a check representing any payments
made to him for the Pay Continuation Period, to Tanning's Vice President of
Human Resources, 0000 Xxxxx Xxxxxx Xxxxxx, Xxxxx 000, Xxxxxx, Xxxxxxxx 00000.
15. Governing Law. Stack agrees with Tanning that this Agreement shall be
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governed by and interpreted in accordance with the laws of the State of
Colorado.
16. Entire Agreement. This Release, and the Employment Agreement between
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Stack and Tanning collectively represent the entire agreement between Stack or
anyone who has or obtains any legal rights or claims through his and Tanning
with respect to the subject matter covered herein. They replace any other oral
or written agreements, representations, promises or discussions between Stack
and Tanning including the agreement dated February 1, 1999. In the event of a
conflict between the provisions of this Agreement and the provisions of the
Employment Agreement, the provisions of this Agreement shall control.
STACK ACKNOWLEDGES THAT HE HAS READ THIS AGREEMENT, UNDERSTANDS ITS TERMS,
AND IS VOLUNTARILY ENTERING INTO IT WITH THE INTENTION OF RELINQUISHING ALL
KNOWN AND UNKNOWN CLAIMS AND RIGHTS.
TANNING TECHNOLOGY CORPORATION
By: /s/ Xxxx Tanning
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Its: VP of HR & ADMIN
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Date: 6-17-99
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Address: 0000 Xxxxx Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx, 00000
EMPLOYEE:
/s/ Xxxxxx X. Xxxxx
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Xxx Xxxxx
Date: 6-17-99
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