Exhibit 10.21
RELEASE AND SETTLEMENT AGREEMENT
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This RELEASE AND SETTLEMENT AGREEMENT (hereinafter
"Agreement") is made by and between ELECTRONIC RETAILING SYSTEMS,
INC. (hereinafter "THE COMPANY" and XXXXXXX X. XXXXXXXXXXX
(hereinafter "EMPLOYEE"). Wherever used in this Agreement, the
term "THE COMPANY" shall include all officers, directors,
shareholders, employees, agents, representatives, successors and
assigns of ELECTRONIC RETAILING SYSTEMS, INC., in their individual
and/or official capacities.
WHEREAS, EMPLOYEE is employed by THE COMPANY in the position
of Chief Financial Officer; and
WHEREAS, THE COMPANY and EMPLOYEE agree that it is in the
best interests of both parties that EMPLOYEE terminate his
employment with THE COMPANY.
NOW, THEREFORE, in the interest of fully and finally
resolving all matters and disputes arising out of or in any way
connected to the employment of EMPLOYEE by THE COMPANY, and in
consideration of the mutual promises and covenants contained
herein, THE COMPANY and EMPLOYEE, acting of their own free will,
hereby agree as follows:
1. EMPLOYEE's employment with THE COMPANY is terminated
effective May 8, 1998 and EMPLOYEE is no longer deemed an employee
of THE COMPANY for any purpose after such date.
2. (a) THE COMPANY will pay EMPLOYEE severance for the period
beginning on May 8, 1998 and continuing through November 7, 1998
(the "Initial Severance Period"). In addition, if EMPLOYEE has not
obtained other full-time employment (including self-employment) as
of November 7, 1998, THE COMPANY will pay EMPLOYEE severance for
the period beginning on November 8, 1998 and continuing through
the earlier of (i) February 8, 1999 or (ii) such date as EMPLOYEE
commences other full-time employment (including self-employment)
(hereinafter the "Extended Severance Period"). Such severance
payments shall be based on EMPLOYEE's gross biweekly salary of
Seven Thousand Six Hundred Ninety-Two and 31/100 Dollars
($7,692.31), less all applicable deductions
required by law and/or described in this Agreement. Such severance
shall be paid to EMPLOYEE in bi-weekly installments, such
installments to coincide with the regular payroll dates of THE
COMPANY commencing with the first payroll date following
expiration of the seven-day revocation period described in Section
19, below.
(b) THE COMPANY will deduct the following from each payment
made to EMPLOYEE under the terms of subsection 2(a): a) EMPLOYEE's
FICA and Medicare contributions, if any, as required by law; b)
Federal and State income taxes; c) health and dental insurance
premium contributions, as described in Section 3 below; d) any
other deductions required by law or authorized in writing by
EMPLOYEE.
3. (a) During the Initial Severance Period and the Extended
Severance Period, if any, or such earlier date as EMPLOYEE becomes
eligible for coverage under the comparable long term disability
and/or life insurance plans of another employer, THE COMPANY will
continue in effect the long term disability and life insurance
coverage that was in effect for EMPLOYEE immediately prior to May
8, 1998.
(b) During the Initial Severance Period and the Extended
Severance Period, if any, or such earlier date as EMPLOYEE becomes
eligible for coverage under the comparable group medical and/or
dental plan of another employer, THE COMPANY will also continue in
effect medical and dental insurance coverage for EMPLOYEE and his
eligible dependents, provided that EMPLOYEE shall be required to
continue to pay such premium contributions as may be in effect for
THE COMPANY's active employees. Such premium contributions shall
be deducted from the severance checks described in Section 2(a) of
this Agreement until the expiration of the Initial Severance
Period or the Extended Severance Period, as the case may be, and
thereafter shall be remitted by EMPLOYEE directly to THE COMPANY
on the first day of czech subsequent month.
4. EMPLOYEE shall be entitled to keep the lap top computer
and cellular phone provided to him by THE COMPANY, subject to
EMPLOYEE's assumption of and full compliance with all of the
lessee's obligations under the cellular phone lease agreement
previously entered into by him.
5. THE COMPANY shall assume direct responsibility for paying
any lease cancellation fees payable to the landlord of EMPLOYEE's
Connecticut apartment, up to a maximum payment of One Thousand
Nine Hundred Forty Dollars ($1,940).
6. THE COMPANY shall pay the costs of moving EMPLOYEE's
family and personal and household effects to Florida, provided
such move occurs on or before November 8, 1998. THE COMPANY shall
have the right, at its option, to make the arrangements (including
with respect to the negotiation of fees) for such move on
EMPLOYEE's behalf, or to approve in advance any such arrangements
made by EMPLOYEE. In no event shall THE COMPANY be responsible for
paying storage expenses for EMPLOYEE's household and personal
effects prior to EMPLOYEE's move to Florida for longer than four
(4) months.
7. THE COMPANY shall pay all verified and documented closing
costs on EMPLOYEE's purchase of a home in Florida, to the extent
actually paid by EMPLOYEE on or before November 8, 1998, up to a
maximum of Twenty-Two Thousand Dollars ($22,000). Any such costs
advanced by THE COMPANY to EMPLOYEE, to the extent not actually
paid by EMPLOYEE as closing costs and documented as such to THE
COMPANY's satisfaction, shall be repaid by EMPLOYEE to THE COMPANY
or deducted by THE COMPANY from any severance payments otherwise
payable to EMPLOYEE hereunder.
8. EMPLOYEE shall surrender the Incentive Stock Option
Agreement for 49,998 shares, and the nonqualified Stock Option
Agreement for 150,002 shares, of the common stock, $.01 par value
(the "Stock"), of the Company, granted to the EMPLOYEE as of
August 18, 1997 (collectively, the "Stock Options"), and shall
execute a replacement stock option Agreement (the "Replacement
Stock Option") embodying the terms of the Stock Options modified
such that (i) the EMPLOYEE will be entitled to exercise options
for an aggregate of 62,500 shares of Stock under the Replacement
Stock Option until December 31, 1998 based upon his involuntary
termination without cause as of May 8, 1997, and (ii) the
Replacement Stock Options shall not qualify as incentive stock
options under Section 422 of the Internal Revenue Code of 1986, as
amended. As of December 31, 1998, all rights to purchase stock
under such Replacement Stock Option agreement shall cease. Except
as described above, all other stock options and any and all other
rights to acquire any stock of THE COMPANY which were earned or
acquired by EMPLOYEE in the course of his employment with THE
COMPANY are hereby extinguished, and EMPLOYEE consents to the
cancellation of all such stock options, the waiver of all future
rights to acquire stock options and or stock of THE COMPANY earned
or acquired by EMPLOYEE in the course of his employment with THE
COMPANY, and further consents to release THE COMPANY from any and
all further obligations under any other stock options, thereby
rendering any such rights and options null and void and of no
further force and effect.
9. With the exception of the payments and benefits described
above, EMPLOYEE expressly acknowledges that he is not entitled to
any payments, benefits or compensation, in any form for any
reason, from THE COMPANY, including but not limited to any
severance payments or benefits set forth in his offer letter dated
June 24, 1997 (the "Offer Letter"), which Offer Letter is
expressly rescinded and superseded by this Agreement.
10. EMPLOYEE acknowledges that he would not be entitled to
all of the payments and benefits described in Sections 2 through
8 of this Agreement if he did not enter into this Agreement. THE
COMPANY acknowledges that EMPLOYEE would not otherwise release the
potential claims hereinafter set forth but for his receipt of such
severance payments and insurance benefits.
11. With the exception of his lap top computer and cellular
phone, EMPLOYEE shall return to THE COMPANY all property belonging
to THE COMPANY, including but not limited to any and all records,
papers, data, credit cards, keys and security cards belonging to
THE COMPANY in his possession upon execution of this Agreement.
12. (a) EMPLOYEE recognizes and agrees that in the course of
his employment with THE COMPANY, he has been exposed to
confidential information concerning THE COMPANY, including, but
not limited to, existing and contemplated products, trade secrets,
formulas, patents, models, compilations, business and financial
methods or practices, plans, pricing, marketing, merchandising and
selling techniques and information, customer lists, supplier lists
and confidential information relating to policies and/or business
strategies (hereinafter referred to as "Confidential
Information"). EMPLOYEE agrees that all such Confidential
Information is and shall forever remain the sole property of THE
COMPANY. EMPLOYEE shall keep all such Confidential Information
strictly confidential, and he shall not disclose to any third
party in any manner, either directly or indirectly, any of such
Confidential Information at any time, for any purpose. Further,
EMPLOYEE shall not use in any manner, either directly or
indirectly, any of such Confidential Information for his own
benefit or for the benefit of any third party, or for any other
purpose, at any time.
(b) EMPLOYEE agrees that during the term of his employment
with THE COMPANY or its affiliates and for a one-year period
following the termination of his employment, without the prior
written consent of THE COMPANY, EMPLOYEE may not directly or
indirectly, engage, assist or participate in, whether as a
director, officer, employee, agent, manager, consultant, partner,
owner or independent contractor or other participant, any
business, firm, corporation, partnership, enterprise or
organization that conducts a business which involves either (x)
the development, manufacturing, marketing or servicing of systems
sold to the retailing industry for purposes of displaying and
changing retail point of purchase prices and/or displaying other
information targeted at the consumer or store employee via
electronic and non-electronic means or (y) the development,
engineering, manufacturing, marketing or servicing of systems sold
to the retailing industry for purposes of improving pricing
accuracy, product location accuracy, inventory management and item
movement; and which is within any geographic area where THE
COMPANY or any of its affiliates engages in business; provided,
however, that EMPLOYEE may invest in stocks, bonds or other
securities of any similar business (but without otherwise
participating in such similar business) if (i) such stocks, bonds,
or other securities are listed on any national securities exchange
or are registered under Section 12(g) of the Securities Exchange
Act of l934, and (ii) his investment does not exceed, in the case
of any class of the capital stock of any one issuer, 5% of the
issued and outstanding shares, or in the case of bonds or other
securities, 5% of the aggregate principal amount thereof issued
and outstanding.
(c) EMPLOYEE agrees that during the term of his employment
with THE COMPANY or its affiliates and for a one-year period
following the termination of his employment, without the prior
written consent of THE COMPANY, EMPLOYEE may not interfere with
the relationship of THE COMPANY or any affiliate with, or endeavor
to entice away from THE COMPANY or any affiliate, any person,
firm, corporation or other business organization who or which at
any time during EMPLOYEE's employment with THE COMPANY was an
employee or supplier of, or maintained a business relationship
with, THE COMPANY or any affiliate.
(d) EMPLOYEE understands and agrees that violation by him of
any portion of this Section 12 will cause THE COMPANY to suffer
immediate, substantial and irreparable injury, and will be a
sufficient basis to award injunctive relief and monetary damages
to THE COMPANY, without affecting the remainder of this Agreement.
13. For and in consideration of the payments described in
this Agreement, EMPLOYEE for himself, and for his respective
heirs, executors, administrators, successors and assigns,
knowingly releases and forever discharges THE COMPANY and its
affiliates from any and all claims, demands, obligations, damages,
liabilities and causes of action (including, but not limited to,
claims and causes of action for wrongful discharge, tort,
defamation, breach of contract and breach of the duty of good
faith and fair dealing, and causes of action and claims or causes
of action under Title VII of the Civil Rights Act of 1964, 42
U.S.C. Section 2000e et. seq., the Civil Rights Act of 1991, 42
U.S.C. Section 1981, et. seq., the Connecticut Discriminatory
Practices Act, Conn. Gen. Stat. Section 46a-58 et. seq., the
Americans with Disabilities Act, 42 U.S.C. Section 12101 et. seq.,
the Age Discrimination in Employment Act, 29 U.S.C. Section 621
et. seq., the Connecticut Whistle Blowers' Act, Conn. Gen Stat.
Section 31-51m, the provisions of the Connecticut General Statutes
concerning the payment of wages (Conn. Gen. Stat. Section 31-58
et. seq. and Conn. Gen. Stat. Section 31-70 et seq.), the Fair
Labor Standards Act, 29 U.S.C. Seciton 201 et seq., all
Massachusetts laws governing the foregoing subject matters, and
all other federal, state and local laws, ordinances or
regulations), in law or in equity, which EMPLOYEE now has or ever
had against THE COMPANY, for any losses, injuries or damages
(including back pay, front pay, liquidated, compensatory or
punitive damages, attorneys' fees and litigation costs), resulting
from and/or arising out of or in any way connected with EMPLOYEE's
employment by THE COMPANY and/or his separation from such
employment.
14. THE COMPANY and EMPLOYEE expressly acknowledge and agree
that the consideration provided herein is solely for the purpose
of amicably resolving any dispute arising out of EMPLOYEE's
employment by THE COMPANY and his separation from such employment.
EMPLOYEE and THE COMPANY further understand and agree that this
Agreement does not constitute an admission by THE COMPANY that THE
COMPANY is in any way liable to EMPLOYEE or that THE COMPANY
harmed or damaged EMPLOYEE or violated any rights he may have or
in any respect treated him unfairly or unlawfully.
15. Should EMPLOYEE commence or prosecute any action or
proceeding contrary to the provisions of this Agreement, he agrees
to indemnify THE COMPANY for all costs, including court costs and
reasonable attorneys' fees, incurred by THE COMPANY in the defense
of such action or in establishing or maintaining the application
or validity of this Agreement or provisions thereof.
16. Except as otherwise provided specifically in this
Agreement, in the event any party to this Agreement claims that
the other party has failed to comply with the terms of this
Agreement, the remedy for the party claiming the breach shall be
an appropriate legal action to require the other party to comply
with the Agreement and to obtain damages resulting from the
breach, including all costs incurred by the non-breaching party,
including court costs and reasonable attorney's fees in
prosecuting any such legal action.
17. THE COMPANY and EMPLOYEE expressly acknowledge and agree
that they will not make any claim or demand and each of them
hereby waives any rights any of them may now have or may hereafter
have or claim to have, based upon any alleged oral alteration,
amendment, modification or any other alleged change in this
Agreement; that the validity, effect and operation of this
Agreement shall be determined by the laws of the State of
Connecticut; and that there is no written or oral understanding or
agreement between them that is not recited herein.
18. EMPLOYEE affirmatively states that he has had a full and
fair opportunity to consult with an attorney regarding the
provisions of this Agreement, that he understands that he is
entitled to have a period of twenty-one (21) days to consult with
an attorney and consider this Agreement, and that if he signs the
Agreement prior to the expiration of such twenty-one (21) days, he
does so voluntarily and of his own free will.
19. All parties acknowledge that for a period of up to seven
(7) days following execution of this Agreement, EMPLOYEE shall
have the right to revoke his assent to this Agreement, in which
case the provisions of the Agreement shall become null and void.
20. THE COMPANY and EMPLOYEE affirmatively state that they
have a full understanding of the contents of the Agreement and the
effects thereof; and that they have executed the same voluntarily
and of their own free will without any coercion.
21. THE COMPANY and EMPLOYEE agree that neither they nor
their respective immediate family members, attorneys, auditors,
agents, members, officers, assigns, employees, heirs, successors
or representatives, will publish, publicize or disseminate, or
cause to be published, publicized or disseminated, in any manner,
information relating to the contents of this Agreement or the
discussions or events that led up to it, to any third party,
including, but not limited to, the news and communications media
or agents thereof, excepting such disclosure that THE COMPANY and
EMPLOYEE may make to their respective attorneys, auditors or tax
planners, or any disclosure EMPLOYEE makes to members of his
immediate family or any disclosure by EMPLOYEE or THE COMPANY in
compliance with any state or federal law or any disclosure made by
EMPLOYEE for the purpose of enforcing the terms of this Agreement,
should THE COMPANY fail to comply with the terms of this
Agreement. Further, THE COMPANY may also disclose information
relating to the terms or contents of this Agreement to officers,
employees, agents, members or representatives of THE COMPANY on a
need-to-know basis for purposes of carrying out or effecting
compliance with the parties' obligations under this Agreement.
IN WITNESS WHEREOF, the aforementioned parties, intending to
be legally bound hereby, have executed this Agreement.
/s/ Xxxxxxx X. Xxxxxxxxxxx
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Xxxxxxx X. Xxxxxxxxxxx
STATE OF FLORIDA)
:ss: Date: 5/18/98
COUNTY OF PALM BEACH)
Personally appeared EMPLOYEE, Signer of the foregoing
Instrument, and acknowledged the same to be his free act and deed
before me.
/s/ Xxxxxxxx Xxxxxxxxxx
------------------------
Notary Public
ELECTRONIC RETAILING SYSTEMS,
INC.
By: /s/ Xxxxxxxx X. Xxxxxxx
--------------------------
STATE OF CONNECTICUT)
: ss: Date:
COUNTY OF )
Personally appeared __________________, Signer of the
foregoing Instrument, and acknowledged the same to be his/her free
act and deed on behalf of ELECTRONIC RETAILING SYSTEMS, INC.
/s/ Xxxx Xxxxx
--------------------------
Notary Public/Commissioner
of the Superior Court
