SEVERANCE AGREEMENT AND RELEASE
This Severance Agreement and Release (the "Agreement") is entered into as of
this the 30 day of June, 2000, by and between Nexland, Inc. an Arizona
corporation (the "Company") and Xxxxxxx Xxxxxx (the "Executive").
WHEREAS, the Company and the Executive have decided to terminate the Executive
Employment Agreement between them dated April 25, 2000 (the "Employment
Agreement") and the employment relationship existing thereunder; and
WHEREAS, both Executive and the Company desire to resolve any differences and/or
disputes with respect to Executive's employment and the termination thereof;
NOW THEREFORE, in consideration of the mutual agreements and covenants set forth
herein, and for such other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Executive and the Company
acknowledge and voluntarily agree as follows:
1. The forgoing recitals are true and correct and are incorporated herein by
this reference.
2. The Executive and the Company shall terminate the Employment Agreement as of
5:00 p.m., Eastern Standard Time on June 30, 2000 the ("Effective
Time"). As of the Effective Time, all rights of the Executive with respect to
the One Million One Hundred Seventy Thousand (1,170,000) shares of common stock
of the Company issued pursuant to Section 4.2 of the Employment Agreement shall
terminate and all Executive Stock (as defined in the Employment Agreement) shall
be forfeited by the Executive.
3. a. In consideration of the termination of the Employment Agreement and the
other covenants and agreements set forth herein, the Company shall, within seven
(7) business days of the date hereof, issue to the Executive Five Hundred
Thousand (500,000) shares of common stock of the Company (the "Shares"). Such
Shares shall be immediately vested and represented by a share certificate of the
Company in the form set forth on Exhibit A hereto.
b. All Five Hundred Thousand (500,000) shares shall be registered on the
company's next registration statement, wherein it registers the shares of Xxxx
Xxxxxx, Xxxx Xxxxxx and Xxxxxx Xxxxxx. The Company agrees that it shall as soon
as reasonably practicable make best efforts to file and make effective such
registration statement with the Securities and Exchange Commission ("SEC") and
such states as the Executive may reasonably request which shall register the
Shares for sale by the Executive. The Executive shall be entitled to sell one
half, or Two Hundred Fifty Thousand (250,000) of such Shares immediately after
such registration statement is declared effective, and such Shares shall be
immediately available for sale by the Executive and subject to no further
restrictions, except those that may be imposed by applicable securities laws and
regulations. The Executive agrees not to sell the remaining Two Hundred Fifty
Thousand (250,000) Shares (the "Remaining Shares") on the public markets until
November 30, 2000, at which time the Remaining Shares shall no longer be subject
to any restrictions except those imposed by any applicable securities laws and
regulations. The Company agrees to keep the registration statement effective for
one (1) year. Executive agrees to cooperate in providing any information
required to keep the registration statement effective, including any post
effective amendments.
4. Except with respect to the (i) covenants and agreements of the Company set
forth in this Agreement and the indemnification rights of the Executive under
Section 10 of the Employment Agreement which shall survive for the period equal
to the statute of limitation plus six (6) months, the Executive, on behalf of
himself, his successors, heirs and assigns, hereby agrees to completely and
irrevocably discharge and release the Company, its officers, directors,
employees, agents, shareholders, affiliate corporations or entities,
predecessors, successors and assigns, and their officers, directors, employees,
agents and shareholders from any and all claims, demands, actions, damages,
lawsuits, obligations, promises, administrative actions, charges and causes of
action, and/or liability whatsoever, both known or unknown, in law or in equity,
involving any matter arising out of or in any way related, directly or
indirectly, to any and all obligations, duties and liabilities under the
Employment Agreement and the termination of same, including, but not limited to,
any claim of wrongful discharge, breach of contract, and/or employment
discrimination in violation arising out of, under, or in relation to the
Executive's employment with the Company, the termination of the Employment
Agreement, the Civil Rights Act of 1871, the Labor Management Relations Act of
1947, the Equal Pay Act of 1963, Title VII of the Civil Rights Act of 1964, the
Occupational Safety and Health Act of 1970, the Rehabilitation Act of 1973, the
Health Maintenance Organization Act of 1973, the Employee Retirement Income
Security Act of 1974, the Immigration Reform and Control Act of 1986, the Civil
Rights Act of 1991, Executive Orders 11141, 11246 and 11375, Chapter 760 of the
Florida Statutes, the Florida Civil Rights Act of 1992, and/or any other state,
federal or local Fair Employment Practice law, employment law, or statute.
5. The Company, for itself and its directors, officers, employees, agents,
subsidiaries and affiliated entities, remises, releases, and forever discharges
Executive, his heirs, executors, and administrators, successors, assigns,
agents, counsel and representatives, of and from all manner of action and
actions, cause and causes of action, suits, debts, sums of money, covenants,
contracts, agreements, claims and demands whatsoever, in law, or in equity, that
Company ever had, now has or may have, for, on, or by reason of any matter,
cause, or thing whatsoever, that may have arisen by reason of Executive's
employment or affiliation with the Company. The Company shall indemnify
Executive and hold him harmless from any liability, damages or costs Executive
may suffer as a result of suits, claims demands, costs or judgments against him
arising out of Executive's employment or affiliation with the Company.
6. The Executive and the Company agree that except as provided in Section 3
above and Section 7 hereof, Executive is not entitled to any additional salary,
benefits, compensation or other consideration of any nature whatsoever.
7. The Executive and the Company agree that Section 7 (Proprietary Rights) and
Section 10 (Indemnification) of the Employment Agreement shall survive the
termination of the Employment Agreement. The Company agrees to maintain director
and officer liability insurance in the minimum amount of One Million Dollars
($1,000,000) for the full period of the statute of limitations plus six months
or provide the Executive with a "tail" policy covering the same period covering
claims for which the Executive is entitled to indemnification pursuant to
Section 10 of the Employment Agreement.
8. The Executive covenants and agrees that this Agreement and its terms and
conditions are, collectively and individually, totally confidential, and that
from the date of this Agreement forward shall forever be kept totally
confidential and shall not in any manner or for any reason be disclosed by
Executive without the express written consent of the Company except (a) to his
attorneys, accountants, and family members on a "need to know" basis, all of
whom shall be informed of and be bound by the provisions of this paragraph; (b)
as may be required by government agencies, such as the Internal Revenue Service
and the SEC; (c) pursuant to court order or subpoena compelling such disclosure.
Should Executive or his representatives receive any such subpoena or court order
compelling disclosure, Executive shall immediately notify the Company so that it
may have the opportunity to interpose an objection. The provisions of this
Section 8 shall not apply in any action brought by the Executive to enforce any
provisions of this Agreement.
9. The Executive shall refrain from making any written or oral statement or
taking any action, directly or indirectly, which he knows or reasonably should
know to be a disparaging or negative comment concerning the Company or its
officers, directors, employees and agents with the intent to injure or damage
the Company or its officers, directors, employees and agents, and shall refrain
from suggesting that any such disparaging or negative comment concerning the
Company or its officers, directors, employees and agents be made except as may
be compelled by a court of competent jurisdiction. The Company shall refrain
from making any written or oral statement or taking any action, directly or
indirectly, which it knows or reasonably should know to be a disparaging or
negative comment concerning the Executive with the intent to injure or damage
the Executive, and shall refrain from suggesting that any such disparaging or
negative comment concerning the Executive be made except as may be compelled by
a court of competent jurisdiction.
10. On or before the Effective Time, the Executive will return to the Company
any and all documents, lists, data, confidential information, trade secrets,
keys, equipment, products or other property in his possession which relate in
any manner to the Company.
11. The Executive and Company each represent and warrant that they have had the
opportunity to review and consider the terms of this Agreement with their
respective legal counsel (the costs of such counsel having been, and continuing
to be, borne exclusively by the Company with respect to Company's legal counsel,
and by Executive with respect to Executive's counsel), and that neither of them
have made any representations concerning the terms or effects of this Agreement
other than those contained in this Agreement, it being clearly understood that
this Agreement and the sections of the Employment Agreement which survive its
termination pursuant to Section 7 hereof are the only agreements between the
parties and they may not be modified or terminated orally, but only in a writing
signed by both of them.
12. The Executive and Company each acknowledge that the other's breach of the
terms of this Agreement would make difficult the assessment of monetary damages
that would be sustained from such breach, and it would be difficult, if not
impossible, to compensate fully for damages for any such breach, specifically
including, but not limited to, breach of the provisions relating to
confidentiality, non-competition, non-disparagement and issuance and
registration of the Shares. Accordingly, each party specifically agrees that the
other shall be entitled to temporary and permanent injunctive relief and/or
specific performance to enforce this Agreement or to enjoin any unauthorized
disclosure of confidential information, and the Party in breach shall expressly
waive the defense that a remedy in damages would be adequate and any requirement
for the security or posting of any bond in connection with any such injunctive
relief. This provision with respect to injunctive relief and/or specific
performance shall not, however, diminish the right of the non-breaching Party to
claim and recover damages in addition to or in lieu of injunctive relief and/or
specific performance.
13. All of the terms and provisions of this Agreement shall be binding upon,
inure to the benefit of, and be enforceable by the parties and their respective
legal representatives, successors and permitted assigns, whether so expressed or
not.
14. This Agreement may be executed in one or more counterparts, each of which
shall be deemed an original, but all of which taken together shall constitute
one and the same instrument. Confirmation of execution by electronic
transmission of a facsimile signature page shall be binding upon any party so
confirming.
15. If any legal proceeding is brought for the enforcement of this Agreement, or
because of an alleged dispute, breach or threatened breach, default or
misrepresentation in connection with any provision of this Agreement, the
successful or prevailing party shall be entitled to recover reasonable
attorneys' fees, sales and use taxes, court costs and all expenses even if not
taxable as court costs (including, without limitation, all such fees, taxes,
costs and expenses incident to arbitration, appellate, bankruptcy and
post-judgment proceedings), incurred in that legal proceeding, in addition to
any other relief to which such party may be entitled. Attorneys' fees shall
include, without limitation, paralegal fees, investigative fees, administrative
costs, sales and use taxes and all other charges billed by the attorney to the
prevailing party.
16. Any civil action or legal proceeding arising out of or relating to this
Agreement shall be brought in the courts of record of the State of Florida in
Miami-Dade County or the United States District Court, Southern District of
Florida, Miami Division. Each party consents to the jurisdiction of such court
in any such proceeding and waives any objection to the laying of venue of any
such proceeding in such court. THE PARTIES EACH KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVE THE RIGHT EITHER MAY HAVE TO A TRIAL BY JURY IN RESPECT OF
ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS
AGREEMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER
VERBAL OR WRITTEN) OR ACTIONS OF EITHER PARTY ARISING OUT OF, CONNECTED WITH OR
RELATED TO THIS AGREEMENT. THIS PROVISION IS A MATERIAL INDUCEMENT FOR EACH
PARTY'S AGREEMENT TO ENTER INTO THIS AGREEMENT AND THE SETTLEMENT CONTEMPLATED
HEREUNDER.
17. If any provision of this Agreement is invalidated by a court of competent
jurisdiction, then all of the remaining provisions of this Agreement shall
remain in full force and effect, provided that both parties may still
effectively realize the complete benefit of the promises and considerations
conferred hereby.
IN WITNESS WHEREOF, the parties have executed this Agreement on the date set
forth above.
Witnesses (2 for each party):
/s/ XXXXXXX XXXXXX
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XXXXXXX XXXXXX
Date: June 30, 2000
NEXLAND, INC., an Arizona corporation
/s/Xxxxxxx Xxxxxx
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Xxxxxxx Xxxxxx, President
Date: June 30, 2000
