EXHIBIT 10.3
AGREEMENT
AGREEMENT made as of the 1st day of October 2002 (the "Effective Date"), by
and between TTR Technologies, Inc., a Delaware corporation with offices at 000
Xxxxxxxxx Xxxxxx, Xxx Xxxx, XX ("TTR Inc."), TTR Technologies, Ltd., a company
organized under the laws of Israel, with offices at 0 Xxxxxxxx Xxxxxx, Xxxx Xxxx
Industrial Zone, Israel ("TTR Ltd."; together with TTR Inc., the "Companies")
and Xxxxxx Xxxxxxx residing at 00 Xxx Xxxxxx Xx. Xxxxxxx 00000 ("Xxxxxxx").
WHEREAS, Xxxxxxx currently serves as (i) TTR Ltd.'s Director of Product and
Research and Development (alternatively referred to chief technology officer),
under that certain restated and amended from time to time employment agreement
between TTR Ltd. and Xxxxxxx first entered into on December 1, 1994,
(hereinafter, the "Employment Agreement") and (ii) as Vice President of Research
and Development of TTR Inc.;
WHEREAS, the Companies have previously terminated Xxxxxxx'x employment,
without cause, under the Employment Agreement and as Vice President of Research
and Development.
WHEREAS, the Companies and Xxxxxxx desire to settle all outstanding
matters, all on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the terms and conditions hereafter set
forth the adequacy and sufficiency of which are hereby acknowledged, the parties
agree hereafter as follows:
1. TERMINATION OF POSITIONS. Subject to the terms and conditions set forth
herein, by his execution of this Agreement, the Companies confirm that they have
terminated Xxxxxxx from any positions he has held with the Companies including,
without limitation executive management positions.
2. COMPANY PROPERTY. Except as otherwise herein provided, on or before the
Effective Date, Xxxxxxx shall return to the Companies all TTR Ltd. and TTR Inc.
property then in his possession. The Company shall have an opportunity (at its
own expense) to make a back-up or copy of the database personal laptop currently
used by Xxxxxxx, except for Xxxxxxx'x files of a personal nature
3. FINANCIAL TERMS RELATING TO TERMINATION OF EMPLOYMENT. Subject to the
terms and conditions set forth herein and in consideration of the releases
contained herein, Companies hereby agree as follows (collectively, the
"Settlement Amount"):
(a) Upon execution and delivery by Xxxxxxx of this Agreement, TTR Ltd.
shall remit to Xxxxxxx any outstanding salary and other payments due and
payable under Section 4.1 of the Employment Agreement, less deductions and
withholdings under Israeli or other applicable law customarily made by TTR
Ltd. and/or required by law;
(b) Upon execution and delivery by Xxxxxxx of this Agreement, TTR Ltd.
releases to Xxxxxxx all amounts accumulated in Xxxxxxx 's current Bituach
Menahalim and Keren Histalmut policies, and TTR Ltd. (and to the extent
necessary, TTR Inc.) shall take all reasonably necessary actions to
cooperate with
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Xxxxxxx in transferring or redeeming Xxxxxxx'x current Bituach Menhalim and
Keren Hishtalmut policies, in accordance with such policies terms and
conditions and applicable law. BY HIS SIGNATURE BELOW, XXXXXXX AGREES THAT
THE TRANSFER TO HIM OF SUCH POLICIES IS BEING MADE IN FULL SATISFACTION OF
ALL CLAIMS BY XXXXXXX AGAINST THE COMPANIES, AND XXXXXXX HEREBY WAIVES ANY
RIGHTS HE MAY HAVE UNDER APPLICABLE LAW OR THE EMPLOYMENT AGREEMENT TO ANY
ADDITIONAL AMOUNTS THAT TTR LTD. MAY BE REQUIRED TO PAY INTO SUCH POLICIES,
INCLUDING, WITHOUT LIMITATION, SEVERANCE PAY UNDER ISRAELI LAW, AND FURTHER
AGREES THAT HE SHALL HAVE NO RIGHT OR REMEDY AGAINST TTR LTD. OR TTR INC.
FOR ANY SUCH SHORTFALL;
(c) The Company represents that the board of directors of TTR
Technologies, Inc. ("TTR Inc.") has provided that the employee stock
options heretofore granted by TTR Inc., as listed on appendix A, to Xxxxxxx
shall, notwithstanding any agreement to the contrary between TTR Inc. and
Xxxxxxx, continue to be exercisable through the duration of the original
grant of such options and, upon execution and delivery by Xxxxxxx of this
Agreement, shall vest and become immediately exercisable, on the terms and
conditions applicable to such grants, including, without limitation, the
exercise price thereof, in accordance with each of TTR Inc.'s 1996 and 2000
equity incentive plans and agreements thereunder. TTR Inc. confirms that
the rights to the options listed in this Section 3(c ) shall inure to the
benefit of Xxxxxxx'x heirs and successors.
All taxes, withholdings and deductions payable or due (under US or
Israeli law) in respect of the Settlement Amount, if any, will be borne by
Xxxxxxx.
4. CONTINUING OBLIGATIONS OF XXXXXXX. Xxxxxxx hereby acknowledges and
agrees that the provisions of Sections 6, 7.1 & 7.2 as amended below, 7.3 and 8
of the Employment Agreement (Secrecy and Nondisclosure, Non-Competition and
Development Rights) shall continue in full force and effect after the Effective
Date of this Agreement, in accordance with their terms and for the duration
specified therein. Nothing contained in this Agreement shall be construed or
interpreted as a waiver by the Companies or any of its affiliates or
subsidiaries of any right or remedy available under such sections of the
Employment Agreement in the event of a breach occurring after the Effective Date
of this Agreement.
The Parties agree that section 7.1 of the Employment Agreement shall be
amended as follows:
"7.1 During ...directly or indirectly competes with a product or component
(i) BEING DESIGNED, PRODUCED, SOLD OR DISTRIBUTED BY THE COMPANY OR ITS PARENT
COMPANY ANY TIME DURING THE 12 MONTHS PRIOR TO THE DATE OF TERMINATION OR
CESSATION OF EMPLOYMENT (ii) or to which the Company or its parent company
HAS/HAD proprietary rights ANY TIME DURING THE 12 MONTHS PRIOR TO THE DATE OF
TERMINATION OR CESSATION OF EMPLOYMENT . The limitations...."
The Parties agree that section 7.2 of the Employment Agreement is deleted.
5. CORPORATE INDEMNIFICATION. TTR Inc. agrees to hold harmless and
indemnify Xxxxxxx to the extent permitted by law, and to such extent that the
Companies' directors and
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officers insurance or such other insurance as the Companies may have in effect
at the time of a Proceeding (as defined herein) does not provide coverage or to
the extent that Damages (as defined herein) exceed such insurance policy
coverage limits, for the costs of defense and any and all losses, claims,
damages, liabilities or expenses, including, without limitation, attorneys'
fees, judgments, fines, excise taxes or penalties, witness fees (including
travel, lodging and food), amounts paid in settlement and other expenses
incurred in connection with any Proceeding (the "Damages"), relating to any
completed, actual, pending or threatened action, suit, claim or proceeding,
whether civil, criminal, administrative or investigative (including an action by
or in the right of either of the Companies) and whether formal or informal (each
a "Proceeding"), in which Xxxxxxx is, was or becomes involved by reason of the
fact that Xxxxxxx was a director, officer, employee, trustee or agent of either
of the Companies or that, being or having been such a director, officer,
employee, trustee or agent, Xxxxxxx is or was serving at the request of the
Company as a director, officer, employee, trustee or agent of another
corporation or of a partnership, joint venture, trust or other enterprise,
whether the basis of such proceeding is an alleged action (or inaction) by
Xxxxxxx in an official capacity as a director, officer, employee, trustee or
agent or in any other capacity while serving as a director, officer, employee,
trustee or agent.
The indemnity obligations of the Companies hereinabove set forth shall be
binding upon and inure to the benefit of any successors, assigns, heirs and
personal representatives of the Companies and Xxxxxxx.
6. RELEASES.
6.1 In consideration of the promises, covenants and releases contained
herein, the adequacy of which is hereby acknowledged, Xxxxxxx (on his behalf and
on behalf of each of his respective agents, attorneys, heirs, successors,
executors, personal representatives and assigns) does hereby absolutely and
unconditionally waive, release and forever discharge each of the Companies,
their respective affiliates and subsidiaries, their respective past, present and
future officers, directors, shareholders, employees, agents, attorneys,
successors and assigns (hereinafter, the "Companies' Released Parties"), from
any claims, demands, obligations, liabilities, rights, causes of action and
damages, whether liquidated or unliquidated, absolute or contingent, known or
unknown, from the beginning of time to the Effective Date of this Agreement,
including, without limitation, those claims arising under the Employment
Agreement, and/or Xxxxxxx'x position as an officer, director, and/or employee of
the Companies and its affiliates and subsidiaries, any claims under Israeli
labor laws and regulations including claims for wrongful termination, or claims
with respect to any other payment required under Israeli law Notwithstanding the
foregoing, the rights and obligations set forth in this Agreement shall remain
in full force and effect; nothing hereunder shall be construed to release any
rights accrued to Xxxxxxx to continue or redeem any employee welfare benefit
plan (including without limitation Betuach Menahalim and Keren Hishtalmut)
during his employment, or to release any rights accrued or applicable to Xxxxxxx
under any applicable insurance policy, including any officer and director
liability insurance coverage or any errors and omissions coverage; nothing
hereunder shall waive any indemnification rights applicable to Xxxxxxx as a
former officer and Director of the Companies or shall be construed to waive any
rights Xxxxxxx has as a shareholder or a holder of options.
6.2 In consideration of the promises, covenants and releases contained
herein, the adequacy of which is hereby acknowledged, each of the Companies (on
its behalf and on behalf of its affiliates and subsidiaries and each of their
respective, past, present and future officers, directors, employees, attorneys,
agents, successors, executors, and assigns) does hereby
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absolutely and unconditionally waive, release and forever discharge Xxxxxxx (and
his agents, attorneys, heirs, successors, executors, personal representatives
and assigns ), from any claims, demands, obligations, liabilities, rights,
causes of action and damages, whether liquidated or unliquidated, absolute or
contingent, known or unknown, from the beginning of time to the Effective Date
of this Agreement, including, with limitation, those arising under the
Employment Agreement, and/ or Xxxxxxx'x position as an officer, director, and/or
employee of Companies and/or any of its affiliates or subsidiaries. The
foregoing release shall not be construed as a waiver of future claims by
Companies arising from Xxxxxxx'x conduct after the Effective Date of this
Agreement with respect to his obligations to Companies under the confidentiality
and non-competition contained in the Employment Agreement and any undertakings
of Xxxxxxx pursuant to this Agreement.
7. NON-DISPARAGEMENT. The Parties (on behalf of their heirs and personal
representatives, successors and assigns), agrees not to disparage the other or
their respective businesses or any of their respective employees, consultants,
stockholders, directors, affiliates, subsidiaries or representatives.
8. PRESS RELEASE. On or immediately following the Effective Date, the
Parties shall agree upon the wording of a press release to be immediately issued
relating to Xxxxxxx 's departure.
9. RELIANCE. The parties acknowledge and agree that in the execution of
this Agreement, neither has relied upon any representation by any party or
attorney, except as expressly stated or referred to herein.
10. HEADINGS. Section and subsection headings are not to be considered
part of this Agreement and are included solely for convenience and are not
intended to be full or accurate descriptions of the content thereof.
11. SUCCESSORS AND ASSIGNS. Except as otherwise provided in this
Agreement, all the terms and provisions of this Agreement shall be upon, and
shall inure to the benefit of, the parties hereto and their respective heirs,
personal representatives, successors and assigns.
12. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
13. ENTIRE AGREEMENT. . This Agreement constitutes the entire agreement
among the parties hereto with respect to the subject matter hereof and
supersedes any prior or contemporaneous understanding or agreement or letters,
written or verbal, among the parties with respect to the subject matter hereof
other than as expressly referenced herein. No supplement, modification or waiver
or termination of this Agreement or any provision hereof shall be binding unless
executed in writing by the parties to be bound thereby.
14. GOVERNING LAW, JURISDICTION AND FORUM. This Agreement, its validity,
construction and effect shall be governed by and construed under the laws of the
State of Israel without reference to the principles of conflict of laws. The
parties hereby irrevocably consent to the jurisdiction of the courts of Tel Aviv
for all actions, disputes, controversies, differences or questions arising out
of or relating to this Agreement.
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15. REPRESENTATION. Each of Xxxxxxx and TTR Inc. and TTR Ltd.,
acknowledges that they have had the opportunity to consult with legal counsel
respecting this Agreement. Each person executing this Agreement on behalf of a
corporation hereby represents and warrants that he has been authorized to do so
by all necessary corporate action.
IN WITNESS WHEREOF, each of the parties has set forth its/ his signature as
of the date first written above.
TTR TECHNOLOGIES, INC. TTR TECHNOLOGIES, LTD.
By: /s/ Xxxxxx X. Xxxxx By: /s/ Xxx Xxxxx
Title: CEO Director
/s/ Xxxxxx Xxxxxxx
XXXXXX XXXXXXX
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