Exhibit 10.1: Settlement Agreement and Release
This Settlement Agreement and Release (the "Agreement") is made and entered into
by and between Xxxxxx.xxx, Inc., a Delaware corporation ("Youbet"), and Xxxxxx
X. Xxxxxx (the "Employee"), and inures to the benefit of the above-named
parties' current, former and future parents, subsidiaries, predecessors,
successors, joint venturers, related and/or affiliated persons, trust
beneficiaries, directors, officers, stockholders, attorneys, accountants,
insurers, reinsurers, agents, employees and assigns, as applicable.
RECITALS
A. WHEREAS, Youbet believes that Employee, from time to time
thereafter, has been subject to certain reporting and restrictive requirements
relating to trading Youbet securities, including Section 16 of the Securities
Exchange Act of 1934 (the "Act").
B. WHEREAS, Youbet was recently advised of potential issues that may
exist under Section 16(b) of the Act related to Employee's trading activities in
Youbet securities during the period November 20, 2002 through and including June
3, 2003. (The period of time commencing November 20, 2002, through June 3, 2003
is referred to herein as the "Transaction Period.") Youbet reviewed Employee's
trading activities in its securities during the Transaction Period, and has
concluded that such activities may have resulted in Employee not being in
compliance with all of the requirements of Section 16(b) of the Act.
C. WHEREAS, Employee represents and warrants that he has fully and
accurately responded to Youbet's request for information on April 30, 2003 and
thereafter regarding his transactions in Youbet securities during the
Transaction Period. Although Employee does not acknowledge violation of any
provisions of the Act, he represents that, in the event that any conduct was out
of compliance with Section 16(b) of the Act, such conduct was unintentional and
without knowledge of the requirements and provisions of Section 16(b).
D. WHEREAS, despite his lack of certainty that any of his conduct
violated Section 16(b) of the Act, for purposes of settlement and without
admitting any such violation, the Employee, after consultation with his counsel,
accepts the accuracy of the amount set forth below, and agrees to deliver to
Youbet in accordance with the terms hereof, the alleged profits recoverable by
Youbet as a result of any purported violation by the Employee of Section 16(b)
of the Act, in the amount of $19,652.32.
E. WHEREAS, Employee has delivered or will deliver on or before July
31, 2003 to Youbet cash and other personal property with a present fair market
value in the amount of Nineteen Thousand Six Hundred Fifty-Two dollars and
thirty-two cents plus accrued interest at the applicable federal rate, which
interest shall accrue from the date(s) of any applicable trade(s).
F. WHEREAS, both Youbet and Employee wish to resolve any past, current
and future disputes and claims between them arising from or related to Section
16(b) of the Act and related securities trading policies of Youbet during the
Transaction Period.
NOW, THEREFORE, for and in consideration of the payment described above in
Recital E and the execution of this Agreement and the mutual covenants contained
in the following paragraphs, Youbet and Employee agree as follows:
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1. Incorporation of Recitals. The Recitals and identification of the
parties to, and beneficiaries of, this Agreement are incorporated by reference
as though fully set forth herein.
2. Release. Youbet, for itself and its current, former and future
parents, subsidiaries, predecessors, successors, joint venturers, related and/or
affiliated persons, trust beneficiaries, directors, officers, stockholders,
attorneys, accountants, insurers, reinsurers, agents, employees and assigns,
(whether express, by implication, or by operation of law) and Employee, fully
and forever release and discharge each other with respect to any and all claims,
liabilities, causes of action that either party had, now has or hereafter can,
shall or may have, either directly or indirectly, relating to Employee's
potential or actual violation of Section 16(b) of the Act or any policies of
Youbet relating to trading in securities arising during the Transaction Period.
As an example of the foregoing release, but not as a limitation, Youbet
specifically acknowledges and agrees that any purported conduct of the Employee
during the Transaction Period relating to Section 16(b) of the Act shall not
constitute a basis for any termination of employment, or revocation or
diminution of rights or eligibility under the Company Bonus Plan.
3. Severability of Provisions. The parties acknowledge and agree that
if any provision of this Agreement is found to be unenforceable, it will not
affect the enforceability of the remaining provisions and the courts may enforce
all remaining provisions to the full extent permitted by law.
4. Integrated Agreement. The parties acknowledge and agree that no
promises or representations were made to them that do not appear herein and that
this Agreement contains the entire agreement of the parties and supersedes any
prior agreements on the subject matter thereof. The parties further acknowledge
and agree that parole evidence shall not be required to interpret the intent of
the parties.
5. Voluntary Execution. The parties acknowledge that each has read and
understands this Agreement and that each is signing this Agreement voluntarily,
without coercion, and based upon his or its own judgment, and not in reliance
upon any representations or promises made by the other party, other than those
contained within this Agreement.
6. Agreement Does Not Control Undisclosed Transactions. The parties
acknowledge and agree that, in the event that the Employee did not accurately
respond to the request for information on April 30, 2003 in connection with the
review by Youbet of possible non-compliance with Section 16(b), then this
Agreement does not apply to any inaccurate information or undisclosed trade
during the period commencing November 20, 2002 and ending June 3, 2003. The
parties retain all of their respective rights and remedies with respect to any
information requested and not disclosed.
7. Waiver, Amendment and Modification of Agreement. The parties
acknowledge and agree that no waiver, amendment or modification of any of the
terms of this Agreement shall be effective unless in writing and signed by all
parties hereto. No waiver of any term, condition or default of any term of this
Agreement shall be construed as a waiver of any other term, condition or
default.
8. Authority to Enter into Agreement. Each party represents and
warrants that, as of the date of the execution of this Agreement, he or it has
the sole right and authority to execute this Agreement, and that such party has
not sold, assigned, transferred, conveyed or otherwise disposed of any claims or
demands relating to any right surrendered by virtue of this Agreement. Each
party further represents and warrants that he or it has had the opportunity to
consult with, and has consulted, legal counsel in connection with the
negotiation and execution of this Agreement. Each party and its signatory
represents that the signatory is either a party or a business representative or
assignee of, and is fully authorized to execute this Agreement on behalf of, the
party for whom he or she signs.
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9. California Law. The parties agree that this Agreement and its terms
shall be construed under California law.
10. Venue. The parties agree that all disputes and claims arising from
this Agreement must be brought in the United States, in a California state court
in and for the County of Los Angeles or in the United States District Court for
the Central District of California.
11. Drafting. The parties agree that this Agreement shall be construed
without regard to the drafter of the same and shall be construed as though each
party to this Agreement participated equally in the preparation and drafting of
this Agreement.
12. Headings. The headings used in this Agreement are for the purpose
of organization only and are not intended to inform, alter or control the terms
of this Agreement.
13. Facsimile Signature. Facsimile signatures on this Agreement shall
be treated as original signatures. 14. Counterparts. This Agreement may be
signed in counterparts, and said counterparts shall be treated as though signed
as one document.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
signed on the date and year written below.
Dated: June 27, 2003 "Youbet"
Xxxxxx.xxx, Inc.,
a Delaware corporation
By: /s/ XXXX XXXXXXX
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Print Name: Xxxx Xxxxxxx
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Its: Chief Financial Officer
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Dated: June 27, 2003 "Employee"
/s/ XXXXXX X. XXXXXX
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Xxxxxx X. Xxxxxx
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