EXHIBIT 10.33
SEPARATION AND CONSULTING AGREEMENT
This Separation and Consulting Agreement ("Agreement") is entered
into effective as of March 31, 2002, by and between W. Xxxxxx Xxxxxx ("Xxxxxx")
and Xxxxxxx.xxx, Inc., a Delaware corporation (the "Company"), with regard to
the following:
R E C I T A L S
A. Until December 18, 2001, Xxxxxx was employed as the Company's
Chief Executive Officer. On December 18, 2001, by mutual agreement of Xxxxxx and
the Company, Xxxxxx stepped down as Chief Executive Officer but has continued as
a full-time employee of the Company.
X. Xxxxxx and the Company are parties to an Employment Agreement
dated effective as of April 29, 1999 ("Employment Agreement"), a Proprietary
Information and Inventions Agreement dated January 26, 1998 ("Inventions
Agreement") and an Indemnification Agreement dated February 5, 1998
("Indemnification Agreement").
X. Xxxxxx has been granted options to acquire a total of 384,861
shares of the Company's Common Stock (the "Stock Options"), as set forth on
Schedule I hereto.
D. The Company and Xxxxxx have agreed that Xxxxxx will
voluntarily resign from his employment with the Company effective March 31,
2002.
E. In connection with Xxxxxx'x separation from the Company, the
Company and Xxxxxx have agreed to the releases, services, payments and benefits
set forth herein.
X. Xxxxxx is hereby informed that he has twenty-one (21) days
from receipt of this Agreement to consider it. The Company hereby advises Xxxxxx
to consult with an attorney before signing this Agreement.
X. Xxxxxx acknowledges that for a period of seven (7) days
following his signing this Agreement (the "Revocation Period"), he may revoke
the Agreement. This Agreement shall not become effective or enforceable until
the Revocation Period has expired.
Therefore, in consideration of the premises recited above, the
mutual exchange of promises contained in this Agreement and other valuable
consideration, the receipt and adequacy of which are hereby acknowledged by the
Company and Xxxxxx, the parties agree as follows:
AGREEMENT
1. Resignation. Xxxxxx hereby voluntarily resigns from his
employment with the Company effective March 31, 2002.
2. Payment and Benefits.
2.1 Salary. The Company agrees to continue to pay Xxxxxx his
regular base salary as set forth in the Employment Agreement through and
including June 30, 2003, on the Company's regular payroll dates. Such payments
shall be after applicable deductions and withholdings.
2.2 Insurance. The Company agrees to continue to pay the
premiums on Xxxxxx'x Blue Cross and Blue Shield insurance plans, up to a maximum
premium of $8,500 per year, for the coverage period through and including June
30, 2003.
2.3 Xxxxxx Consulting. During the period from March 31, 2002
through June 30, 2003, Xxxxxx agrees to make himself available on an
as-requested basis to the Company's officers, directors, employees and agents
for up to one-quarter of his business time to consult with the Company on such
matters as the Company shall reasonably request, provided that such requests for
consultation shall be made with reasonable advance notice. In exchange for such
consulting services, the Company shall pay Xxxxxx the sum of $100,000, payable
in equal installments on each of the Company's regular payroll dates through
June 30, 2003, and modify his Stock Options as provided in Section 2.4 below.
Xxxxxx shall have no authority to act on behalf of the Company, to bind the
Company, or to commit the Company financially or to obligate the Company in any
way unless such authority is specifically delegated to Xxxxxx by the Company in
writing. Xxxxxx shall not make any representations to the contrary to any person
or entity. In consideration of such payment and the modification of his Stock
Options, Xxxxxx agrees that he will not, directly or indirectly, during the term
of his consultancy with the Company hereunder, engage or invest in, own, manage,
operate, finance, control or participate in the ownership, management,
operation, financing or control of, be employed by, associated with, or in any
manner connected with, or lend his name or any similar name to, any business
whose products or activities compete with the Company's ticketing products or
services.
2.4 Stock Options. During the period from March 31, 2002
through June 30, 2003, the Stock Options shall continue to vest in accordance
with their terms as if Xxxxxx had continued as an employee of the Company during
such period. On June 30, 2003, provided that Xxxxxx has reasonably satisfied all
of his duties and obligations under this Agreement, all of the Stock Options
then outstanding shall vest and all such vested Stock Options shall remain
exercisable until June 30, 2004, unless earlier terminated pursuant to their
terms as a result of a corporate transaction, and shall then expire and be of no
further force or effect.
2.5 Accrued Vacation. On March 31, 2002, upon his resignation,
Xxxxxx will be issued a check by the Company in the amount of $21,154, less
applicable withholdings, for his 160 hours of accrued vacation. All other
accrued vacation will have been used by Xxxxxx prior to March 31, 2002.
3. Waiver of Rights Under Employment Agreement; No Other
Benefits. Except for the continuing obligations of Xxxxxx under Sections 3.1,
3.2, 3.3, 3.4, 3.6, 3.7 and 5.8 of the Employment Agreement and under the
Inventions Agreement, which Xxxxxx hereby reaffirms, the parties agree that the
Employment Agreement is terminated in its entirety as of
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March 31, 2002, and Xxxxxx expressly waives any notice periods for termination
or resignation under the Employment Agreement. Xxxxxx agrees that he is not
entitled to receive, and will not claim, any damages, profits, compensation,
bonuses, benefits, vacation, stock options or rights other than (i) what is
expressly set forth in this Agreement and the Indemnification Agreement and (ii)
salary accrued through March 31, 2002. Xxxxxx acknowledges that the
consideration he is receiving under this Agreement is in lieu of, and he hereby
waives any other rights he may have had under, the Employment Agreement, and any
other agreements, express or implied, he may have had with the Company except
for the Indemnification Agreement and any agreements or resolutions adopted by
the Company's Board of Directors providing rights of indemnification to officers
and directors of the Company that were in effect during the term of Xxxxxx'x
employment. This Agreement supersedes all rights and/or benefits Xxxxxx may have
or claim arising out of the Employment Agreement.
4. Return of Company Property; Expenses.
4.1 Prior to the end of his consulting period, Xxxxxx shall
return to the Company all Company property and equipment in his possession or
under his control, including, but not limited to, any cell phones, computers and
pagers.
4.2 On or before March 31, 2002, Xxxxxx must submit to the
Company all outstanding business expenses incurred prior to March 31, 2002 for
reconciliation and payment. Reimbursement of such business expenses will be made
by April 15, 2002. Expenses submitted thereafter will not be reimbursed, unless
approved in advance by the Company in connection with the Xxxxxx'x consulting
services hereunder.
5. Releases.
5.1 General Release by Xxxxxx. Excepting only the obligations
undertaken by the Company in accordance with this Agreement, the Stock Options
as amended hereby, and the Indemnification Agreement, and except for any
obligation to indemnify Xxxxxx pursuant to the Company's Certificate of
Incorporation or Bylaws as in effect as of the date hereof, which obligations
shall not be released or, except as specifically set forth in this Agreement,
altered or amended in any way by this Agreement, and in exchange for the
consideration provided to Xxxxxx in this Agreement, Xxxxxx hereby releases,
acquits, relieves and forever discharges the Company and its successors, heirs,
assigns, employees, officers, directors, agents, representatives, stockholders,
attorneys, affiliated corporations, divisions or organizations, whether
previously or hereinafter affiliated in any manner (collectively, the "Company
Released Parties"), from any and all claims, rights, actions, complaints,
demands, causes of actions, wage claims, obligations, promises, contracts,
agreements, controversies, suits, debts, expenses, damages, attorneys' fees,
costs and liabilities of any nature whatsoever, matured or unmatured, fixed or
contingent, which Xxxxxx ever had, now has, or may claim to have from the
beginning of time to the moment he signs this Agreement against the Company
Released Parties (whether directly or indirectly), or any of them, by reason of
any act, event or omission concerning any matter, cause or thing, including,
without limiting the generality of the foregoing, any claims related to or
arising out of (i) Xxxxxx'x employment with the Company or the cessation of that
employment; (ii) any common law torts, including, without limitation, infliction
of emotional distress; (iii) any federal, state or governmental constitution,
statute, regulation or
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ordinance, including, without limitation, Title VII of the Civil Rights Act of
1964, the Fair Labor Standards Act of 1938, the Employee Retirement Income
Security Act, the California Labor Code, the California Fair Employment and
Housing Act and the Age Discrimination in Employment Act of 1967, the Wage, Pay
and Collection Act of the State of Delaware, and any other federal, state or
local employment practice legislation; (iv) any agreement, express or implied,
between Xxxxxx and any of the Company Released Parties; (v) any impairment of
his ability to compete in the open labor market; or (vi) any permanent or
temporary disability or loss of future earnings as a result of injury or
disability arising from or associated with his employment or termination of his
employment relationship with the Company.
5.2 Xxxxxx'x Release of Unknown Claims. Xxxxxx hereby waives
and relinquishes all rights and benefits afforded by Section 1542 of the Civil
Code of California. Xxxxxx hereby acknowledges that he understands the
significance and consequences of this specific waiver of Section 1542. Section
1542 of the Civil Code of California states 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.
Notwithstanding the provisions of Section 1542, and for the purpose of
implementing a full and complete release and discharge of the Company Released
Parties (except as provided in Section 5.1, above), Xxxxxx expressly
acknowledges that the release contained in this Agreement is intended to include
in its effect, without limitation, all claims covered by the release set forth
in Section 5.1 above which Xxxxxx does not know or suspect to exist in his
favor.
5.3 Xxxxxx'x Covenant To Forebear. Xxxxxx further agrees not
to institute, maintain or aid any action at law or in equity or any legal
proceeding whatsoever against any or all of the Company Released Parties (as
defined in Section 5.1, above), which is based on, in whole or in part, or which
arises out of, or is connected with, the claims hereby released.
5.4 Xxxxxx'x Representation and Warranty Regarding Assignment
of Claims. Xxxxxx represents and warrants that he has not assigned any claims
made the subject of Section 5.1 of this Agreement or authorized any other person
or entity to assert any such claim on behalf of him. Further, Xxxxxx agrees that
by the releases contained in this Section 5.1 he waives any claim for damages
incurred at any time after the date on which he signs this Agreement because of
alleged continuing effects of any alleged acts or omissions involving the
Company that occurred on or before the date on which he signs this Agreement,
and any right to xxx for monetary or injunctive relief against the alleged
continuing effects of acts or omissions that occurred before the date on which
he signs this Agreement.
6. No Employment Rights. Xxxxxx acknowledges that effective as of
March 31, 2002, he will no longer be an employee of the Company for any purpose.
Nothing in this Agreement shall be construed to continue, create or imply any
contract of employment between Xxxxxx and the Company.
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7. Assistance/Cooperation With Litigation. In connection with the
Company's participation in current or future litigation relating to events which
occurred during Xxxxxx'x employment or about which Xxxxxx has information,
Xxxxxx agrees to cooperate fully and devote such time as may be reasonably
required in the preparation, prosecution or defense of the Company's case or
cases, including, but not limited to, the execution of truthful declarations or
providing information and/or documents requested by the Company. The Company
shall reimburse Xxxxxx, promptly upon receipt of satisfactory evidence thereof,
for all reasonable expenses (not including any amount for Xxxxxx'x time)
incurred by Xxxxxx in connection with such assistance and/or cooperation with
the Company with respect to such litigation.
8. No Admission. Nothing contained in this Agreement or the fact
that the parties have signed this Agreement shall be considered an admission of
any liability whatsoever.
9. Confidentiality.
9.1 As a material inducement to the Company to enter into this
Agreement and as an indivisible part of the consideration to be received for
entering into this Agreement and for the performance of obligations under this
Agreement by each party to this Agreement, Xxxxxx agrees that he will not
disclose, disseminate and/or publicize and cause or permit to be disclosed,
disseminated and/or publicized, any of the specific terms of this Agreement, any
claims or allegations or the basis for any claims or allegations, which were or
could have been made against the Company, or any of its officers, directors,
shareholders, employees, representatives, agents, attorneys or affiliated
companies, which concern and are within the scope of this Agreement, directly or
indirectly, specifically or generally, to any person, corporation, association,
governmental agency or other entity except: (a) to the extent necessary to
report income to appropriate taxing authorities; (b) in response to an order of
a court of competent jurisdiction or a subpoena issued under the authority
thereof; (c) in response to any subpoena issued by a state or federal
governmental agency; or (d) as otherwise required by law.
9.2 Xxxxxx further warrants and agrees that he will limit his
comments about his separation from the employment of the Company to the fact
that his situation has been resolved satisfactorily and that he has moved on to
other professional opportunities. Xxxxxx shall not disseminate orally or in
writing any comments which are in any way disparaging to the Company or to the
Company's business, owners, officers, agents, representatives or employees.
10. Fees and Costs. Xxxxxx and the Company agree that in the
event of litigation relating to a breach of this Agreement, the prevailing party
shall be entitled to its attorneys' fees and costs.
11. Successors and Assigns. This Agreement, and all the terms and
provisions hereof, shall be binding upon and shall inure to the benefit of the
parties and their respective heirs, legal representatives, successors and
assigns.
12. Waiver. No waiver of any of the provisions of this Agreement
shall be deemed, or shall constitute, a waiver of any other provision, whether
or not similar. No waiver shall constitute a continuing waiver. No waiver shall
be binding unless executed in writing by the party charged with the waiver.
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13. Severability. In the event any provision of this Agreement
shall finally be determined by a court of competent jurisdiction to be unlawful,
such provision shall be deemed to be severed from this Agreement and every other
provision of this Agreement shall remain in full force and effect. If, moreover,
any one or more of the provisions contained in this Agreement shall for any
reason be held by a court of competent jurisdiction to be excessively broad, it
shall be construed, by limiting and reducing it, so as to be enforceable to the
extent compatible with the applicable law as it shall then appear.
14. Legal Representation. The parties acknowledge that they have
had the opportunity to receive the advice of independent legal counsel prior to
the execution of this Agreement and the opportunity to receive an explanation
from legal counsel of the legal nature and affect of the Agreement, and each
party has fully exercised that opportunity to the extent desired and understands
the terms and provisions of this Agreement and its nature and affect. Each party
further represents that it is entering into this Agreement freely and
voluntarily, and not relying on the representations of any other party or of the
counsel of any other party. Each party expressly agrees that this Agreement
shall not be construed or interpreted for or against the party drafting the
Agreement.
15. Notices. All notices, requests, demands and other
communications under this Agreement must be in writing and shall be deemed to
have been duly given (i) on the date of service if served personally on the
party to whom notice is to be given; (ii) on the second business day following
delivery to a courier or messenger service guaranteeing overnight delivery;
(iii) on the date of confirmation of receipt if sent by telecopy or telex; and
(iv) on the date of receipt or refusal indicated on the return receipt if mailed
to the party to whom notice is to be given by first-class mail, registered or
certified, postage prepaid, return receipt requested, and in each case, properly
addressed as follows:
If to the Company: Xxxxxxx.xxx, Inc.
000 Xxxxx Xxxx., 00xx Xxxxx
Xxxxx Xxxx, XX 00000
Attn: Chief Executive Officer
If to Xxxxxx : W. Xxxxxx Xxxxxx
0000 Xxxxxxxx Xxxxx
Xxxxxxx Xxxxx, XX 00000
16. Miscellaneous.
16.1 Entire Agreement. This Agreement constitutes the entire
agreement and supersedes all prior written or oral and all contemporaneous oral
agreements, understandings and negotiations between the parties with respect to
the subject matter of this Agreement.
16.2 Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original, and all of which
shall constitute one and the same instrument.
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16.3 Amendment. This Agreement may not be amended except by
an agreement in writing signed by the parties to this Agreement or their
respective successors-in-interest and expressly stating that it is an amendment
of this Agreement.
16.4 Governing Law. This Agreement shall be governed in all
respects, including validity, interpretation and effect, by the laws of the
State of California.
16.5 Survival of Representations and Warranties. All
representations and warranties contained in this Agreement shall survive the
execution and delivery of this Agreement.
Any party may change its address for the purpose of this
Agreement by giving the other party written notice of the new address in the
manner set forth above.
This Agreement has been executed as of the day first hereinbefore
written.
"COMPANY"
XXXXXXX.XXX, INC.,
a Delaware corporation
By: /s/ Xxxxxx Xxxxxxx
----------------------------------
Xxxxxx Xxxxxxx,
Chief Executive Officer
"XXXXXX"
/s/ W. Xxxxxx Xxxxxx
----------------------------------------
W. Xxxxxx Xxxxxx
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SCHEDULE I
STOCK OPTIONS
Exercise Price
Grant Date No. of Shares Per Share
---------- ------------- --------------
11/01/96 50,000 $ 7.20
10/15/97 50,000 18.00
09/14/98 75,000 27.00
04/29/99 83,333 49.50
09/16/99 27,778 72.00
09/25/00 6,250 7.75
03/07/01 62,500 5.50
12/18/01 30,000 2.79
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384,861
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