Exhibit 10.17
SEPARATION AGREEMENT AND RELEASE OF ALL CLAIMS
This Separation Agreement and Release of All Claims
("Agreement") is made and entered into as of this 14th day of October, 2003 by
and between Xxxxx Xxxxx (hereinafter sometimes referred to as "Xxxxx") and
VESTIN GROUP, INC., a Delaware corporation (hereinafter sometimes referred to as
the "Company" or "Vestin").
WITNESSETH:
WHEREAS, Xxxxx was employed by the Company (for purposes of this
Agreement the Company shall include Vestin Mortgage, Inc., a Nevada corporation,
Vestin Capital, Inc., a Nevada corporation, Vestin Mortgage Advisors, Inc., an
Arizona corporation, Vestin Fund I, LLC, a Nevada limited liability company,
Vestin Fund, II, LLC, a Nevada limited liability company, in Vestin Nevada,
Inc., a Nevada corporation and Vestin Fund III, LLC, a Nevada limited liability
company) pursuant to an employment agreement between Vestin Group, Inc. and
Xxxxx dated April 1, 2000 ("Employment Agreement"); and
WHEREAS, Xxxxx was Chief Operating Officer of Vestin Group, Inc. and
Chief Executive Officer of Vestin Mortgage, Inc.; and
WHEREAS, both Xxxxx and the Company desire to terminate their
employment relationship with each other on the terms and conditions set forth in
this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and promises
herein contained and other good and valuable consideration, receipt of which is
hereby acknowledged, it is hereby agreed by and between the parties as follows:
FIRST: The parties hereby agree that the Employment Agreement
is terminated effective upon the execution of this Agreement and Xxxxx shall
resign from all positions with the Company as of the date this Agreement is
executed which positions include but are not limited to Chief Operating Officer
and Director of Vestin Group, Inc. and Chief Executive Officer and Director of
Vestin Mortgage, Inc.
SECOND: (a) Xxxxx understands and agrees that he has had
the opportunity to consider this Agreement for a full twenty-one (21) days from
its receipt (Xxxxx can voluntarily sign earlier) and that he did not execute
this Agreement without first being advised in writing to consult with an
attorney.
(b) Pursuant to this Agreement, Xxxxx shall be a
consultant to the Company and shall be assigned projects similar to those which
he worked on while employed
by the Company. Xxxxx agrees that for a period of three (3) years following the
date this Agreement is executed (the "Term") he shall make himself available at
all reasonable times for the purpose of providing information and consultation
to the Company relating to all projects with which he is familiar and for which
he had duties and or responsibilities while he was employed by the Company which
projects shall include but not be limited to the projects commonly known as
Xxxxxxxx'x Harbor, Xxxxxxxx'x Vista, Sterling 183, Sterling Springdale, Xxxxxx
Xxxxx, 105 Group, South Mountain, the Ranches, the Castaways, the Xxxxxxx
loan/case, Mesquite 643 and Xxxxxx Heights, to provide litigation support and
testimony for any projects of the Company.
(c) Xxxxx agrees that for a period of five (5)
years from the date this Agreement is executed he shall not, except with the
written consent of the Company:
(i) either directly or indirectly, for
himself or any third party canvass, contact, solicit, attempt to solicit, induce
or attempt to induce, encourage, divert or accept investments from any investor
of the Company; or
(ii) solicit, attempt to solicit,
interfere with, induce, attempt to induce, encourage, divert, or attempt to
cause (i) any employee or prospective employees of the Company to terminate
and/or leave the employment of the Company for Xxxxx'x own behalf or on behalf
of any person, firm, partnership, association, corporation, business
organization, entity, or enterprise or (ii) any investor to reduce, withdraw or
withhold investments from the Company;
provided, however, Section (c)(i) of Article Second shall not apply in any
circumstance in which Xxxxx has no prior knowledge that any individual or entity
described in (c)(i) is an investor with the Company.
(d) Outside Activities and Non-Competition.
Xxxxx recognizes that the Company's decision to enter into this Agreement is
induced in part because of the covenants and assurances made by Xxxxx, that
damages will be done to the Company if Xxxxx breaches this Article Second,
subsection (d). Therefore, Xxxxx agrees that for a period of three (3) years
from the date of this Agreement, neither he nor his affilates shall, directly or
indirectly, serve as an employee, contractor, consultant, agent, principal or in
any other individual or representative capacity in any of the following
companies or their affiliates: USA Commercial Mortgage Company, Inc.,
Consolidated Mortgage Corporation, Aspen Financial, Inc. or One Cap Mortgage,
Inc.. For purposes of this Section (d) of Article Second, the term "affiliates"
shall mean any entity controlled by or under common control with Xxxxx or such
company.
(e) Confidential Information. Xxxxx agrees to
keep confidential and not to use or to disclose to others during the term of
this Agreement and thereafter, except as expressly consented to in writing by
the Company or required by law, or by any governmental or other regulatory
agency in connection with any licensing or similar
2.
application made by Xxxxx or required by the governmental or other regulatory
agency, any secrets or confidential technology, proprietary information,
customer, client or investor lists, or trade secrets of the Company, or any
matter or thing ascertained by the Company through Xxxxx'x affiliation with the
Company whether prior to or after the date this Agreement is executed, the use
or disclosure of which matter or thing might reasonably be construed to be
contrary to the best interest of the Company. Xxxxx shall, upon execution of
this Agreement; return any papers, client, customer and investor lists, fee
books, client, customer and investor records, files, or other documents or
copies thereof or other confidential information of any kind belonging to the
Company pertaining to the Company's clients, customers, investors, business,
sales, financial condition, or products. Without limiting other possible
remedies to the Company for the breach of this covenant, Xxxxx agrees that
injunctive or other equitable relief shall be available to enforce this
covenant, such relief to be without the necessity of posting a bond, cash or
otherwise. Xxxxx further agrees that if any restriction contained in this
paragraph is held by any court to be unenforceable or unreasonable, a lesser
restriction shall be enforced in its place and remaining restrictions contained
herein shall be enforced independently of each other.
THIRD: As consideration for this Agreement, and provided Xxxxx
is not in default of this Agreement, the Company shall pay to Xxxxx the sum of
One Hundred Eighty Thousand Dollars ($180,000) upon execution of this Agreement.
In addition, Xxxxx shall remain on the Company's payroll until November 30,
2003. Further, the Company shall pay to Xxxxx One Hundred Eighty Thousand
Dollars ($180,000) on or before January 31, 2004. In addition, the stock options
to purchase One Hundred Thirty Three Thousand Three Hundred Thirty Three
(133,333) shares of the Company's stock which are currently vested shall have
the remaining term set forth in the option agreement to exercise his options
(the "Stock Options"), notwithstanding any other terms of the applicable stock
option plan or option agreements or other documentation governing the terms of
the Stock Options. Following execution of this Agreement, the Company shall
provide evidence of such amendments to the option agreements and other
documentation as Xxxxx may reasonably request to evidence the foregoing
understanding concerning the term of the Stock Options.
FOURTH: Each party represents that he has not filed any
complaints, claims, or actions against the other party (and, in the case of
Xxxxx, the Company's officers, agents, directors, supervisors, employees, or
representatives) with any stale, federal, or local agency or court and that he
will not do so at any time hereafter. Further, Xxxxx is hereby waiving any
private cause of action of claim that might be covered in any right to xxx
letter issued by the EEOC.
FIFTH: The parties hereto agree to refrain from any
publication, oral or written, of any defamatory, disparaging or otherwise
derogatory information pertaining to the other party, or to their employment
relationship.
3.
SIXTH: Each party hereby irrevocably and unconditionally
releases and forever discharges the other party (and, in the case of the
Company,each and all of its members, managers, officers, agents, directors,
supervisors, employees, representatives, and affiliates and their respective
successors and assigns and all persons acting by, through, under, or in concert
with any of them from any and all charges, complaints, accrued vacation time,
claims, and liabilities of any kind or nature whatsoever, known or unknown,
suspected or unsuspected (hereinafter referred to as "claim" or "claims") which
each respective party at any time heretofore had or claimed to have or which
Xxxxx may have or claim to have regarding events that have occurred on or prior
to the date of this Agreement, including, without limitation, any and all claims
related or in any manner incidental to Xxxxx'x employment with the Company,
termination of the employment relationship, or the Employment Agreement;
provided, however, that the Company shall not be required to hereby release and
discharge Xxxxx to the extent that any Company claim is found by a court of
competent jurisdiction in a final, non-appealable decision to have been based
solely on fraud, intentional misconduct or gross negligence by Xxxxx acting
without the knowledge of any of Xxxxxxx Xxxxxxx, Xxxxx Xxxxxxxx, Xxx Xxxxxx,
Xxxx Xxxxxxxx or Xxxxx Xxxxxx. It is expressly understood by Xxxxx that among
the various rights and claims being waived in this release are those arising
under the Age Discrimination in Employment Act of 1967 (29 U.S.C. Section 621,
et seq.). Each party hereby represents and warrants that it knows of no claim or
threatened claim against the other party (or, in the case of the Company, each
and call of its members, managers, officers, agents, directors, supervisors,
employees, representatives, or affiliates). The Company hereby represents and
warrants that as of the date this Agreement is executed it knows of no action
taken by Xxxxx in the course of his employment by the Company or its affiliates
or otherwise which constitutes fraud, intentional misconduct or gross negligence
by Xxxxx.
SEVENTH: The parties understand the word "claims" to include
all actions, claims, and grievances, whether actual or potential, known or
unknown, and specifically but not exclusively all claims arising out of Xxxxx'x
employment with the Company and his termination. All such claims (including
related attorneys' fees and costs) are forever barred by this Agreement, without
regard to whether those claims are based on any alleged breach of a duty arising
in a statute, contract, or tort; any alleged unlawful act, including, without
limitation, the Age Discrimination in Employment Act of 1967; the Older Workers
Benefit Protection Act; Title VII of the Civil Rights Act of 1964; the Family
Medical Leave Act; or the Americans With Disabilities Act. Xxxxx, with full
understanding of the rights afforded Xxxxx under each of these Acts, statutes
and claims for relief, hereby waives any right to assert a claim for any relief
available under these Acts, statutes or claims (including but not limited to
back pay, severance, attorneys' fees, damages, reinstatement and/or other
injunctive relief) that Xxxxx may otherwise recover based upon any alleged
violation(s) of these Acts, or any other claim or cause of action regardless of
the forum in which it might be brought.
EIGHTH: In the event Xxxxx is a party, or is threatened to be
made a party to or is involved in any action, suit or proceeding, whether civil,
criminal, administrative or investigative, by reason of the fact that he is or
was the legal representative or was an officer, employee or agent of the Company
or any affiliates thereof, or as a director of the Company or any affiliates
thereof, Xxxxx shall be indemnified and held harmless by the Company to the
fullest extent legally permissible under the laws of the State of Nevada from
time to time against
4.
all expenses, liability and loss (including attorneys' fees, judgments, fines
and amounts paid or to be paid in settlement) reasonably incurred or suffered by
him in connection therewith unless Xxxxx'x conduct in connection therewith was
the result of Xxxxx'x intentional misconduct, fraud or a knowing violation of
the law as determined by a court of competent jurisdiction, after exhaustion of
all appeals therefrom. Further, to the fullest extent legally permissible under
the laws of the State of Nevada, the Company shall advance expenses as incurred
by Xxxxx in connection with any action, suit or proceeding, whether civil,
criminal, administrative or investigative, to which he is a party by reason of
the fact that he is a legal representative or was an officer, employee or agent
of the Company or any affiliates thereof or as a director of the Company or any
affiliates thereof.
NINTH: Xxxxx understands and agrees that he:
(a) Has had a full twenty-one (21) days within
which to consider this Agreement before executing it or by executing this
Agreement earlier has waived the twenty one (21) days.
(b) Has carefully read and fully understands all
of the provisions of this Agreement.
(c) Is, through this Agreement, releasing the
Company from any and all claims he may have against the Company.
(d) Knowingly and voluntarily agrees to all of
the terms set forth in this Agreement.
(e) Knowingly and voluntarily intends to be
legally bound by the same.
(f) Was advised and hereby is advised in writing
to consider the terms of this Agreement and consult with an attorney of his
choice prior to executing this Agreement.
(g) Has a full seven (7) days following the
execution of this Agreement to revoke this Agreement and has been and hereby is
advised in writing that this Agreement shall not become effective or enforceable
until the revocation period has expired. Xxxxx acknowledges and agrees that such
revocation must be received via hand delivery, facsimile, or overnight express
delivery to Xxxxxxx Xxxxxxx at 0000 Xx Xxxxxx Xxx, Xxx Xxxxx, Xxxxxx 00000.
(h) Understands that rights or claims under the
Age Discrimination in Employment Act of 1967 (29 U.S.C.Section 621, et seq.)
that may arise after the date this Agreement is executed are not waived.
TENTH: The parties hereto represent and acknowledge that in
executing this Agreement they do not rely and have not relied upon any
representation or statement made by any
5.
of the parties or by any of the parties' agents, attorneys, or representatives
with regard to the subject matter, basis, or effect of this Agreement or
otherwise, other than those specifically stated in this written Agreement.
ELEVENTH: This Agreement may not be assigned by the Company or
Xxxxx without the prior written consent of the other party. This Agreement shall
be binding upon the parties hereto and upon their heirs, administrators,
representatives, executors successors, and permissible assigns, and shall inure
to the benefit of said parties and each of them and to their heirs,
administrators, representatives, executors, successors, and permissible assigns.
Xxxxx expressly warrants that he has not transferred to any person or entity any
rights, causes of action, or claims released in this Agreement.
TWELFTH: Should any provision of this Agreement be declared or
be determined by any court of competent jurisdiction to be wholly or partially
illegal, invalid, or unenforceable, the legality, validity, and enforceability
of the remaining parts, terms, or provisions shall not be affected thereby, and
said illegal, unenforceable, or invalid part, term, or provision shall be deemed
not to be a part of this Agreement.
THIRTEENTH: This Agreement sets forth the entire agreement
between the parties hereto, this Agreement fully supersedes any and all prior
agreements or understandings, written or oral, between the parties hereto
pertaining to the subject matter hereof.
FOURTEENTH: This Agreement shall be interpreted in accordance
with the plain meaning of its terms and not strictly for or against any of the
parties hereto.
FIFTEENTH: It is further understood and agreed that if, at any
time, a violation of any term of this Agreement is asserted by any party hereto,
that party shall have the right to seek specific performance of that term and/or
any other necessary and proper relief, including but not limited to damages,
from any court of competent jurisdiction, and the prevailing party shall be
entitled to recover its reasonable costs and attorneys' fees.
SIXTEENTH:
This Agreement shall be interpreted in accordance with the
plain meaning of its terms and not strictly for or against any of the parties
hereto. This Agreement shall be governed by, and construed and enforced in
accordance with the laws of the State of Nevada applicable to contracts made and
to be performed therein.
SEVENTEENTH: This Agreement may be executed in counterparts
with the same force and effect as if all signatures were set forth in a single
instrument This Agreement may be executed on facsimile copies with the same
force and effect as an executed original of the same.
6.
IN WITNESS WHEREOF, this Agreement has been executed on the date and
year first set forth above.
/s/ XXXXX XXXXX
Dated: October 14, 2003 --------------------------------------------
XXXXX XXXXX
VESTIN GROUP, INC., a Delaware corporation
Dated: October 14, 2003 By: /s/ Xxxxxxx X. Xxxxxxx
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Xxxxxxx X. Xxxxxxx, Chief Executive Officer
7.
