EXHIBIT 10.26
GENERAL RELEASE
---------------
This General Release ("Agreement") is made as of September 15,
1995, among Silicon Valley Bank (the "Bank"), Silicon Valley
Bancshares ("Bancshares"), and Xxxxxx X. Xxxxxxx ("Employee").
Hereinafter, the Bank and Bancshares collectively shall be referred
to as the "Company".
RECITALS
--------
A. Employee and the Company previously entered into a
Termination Agreement ("Original Termination Agreement"), dated
September 7, 1994. The Original Termination Agreement provides for
the rights and benefits of the Employee and the Company in the
event of a change in ownership of the Company, or termination of
employment of Employee without cause.
B. Pursuant to Section 4(a) of the Original Termination
Agreement, the Company's grant of rights and benefits to Employee
upon a termination without cause is subject to Employee's execution
of a release in a form acceptable to the Company.
C. Effective as of September 15, 1995, the Employee and the
Company have agreed that Employee's employment with the Company is
terminated without "Cause" (as defined in the Original Termination
Agreement).
D. This Agreement sets forth the terms and conditions of
Employee's termination of employment without cause, including
without limitation, Employees's release of the Company in exchange
for the benefits provided for in this Agreement, as contemplated in
the Original Termination Agreement.
AGREEMENT
---------
NOW, THEREFORE, in consideration of the foregoing recitals,
which are incorporated into this Agreement, the mutual promises of
the parties and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, Employee and the
Company hereby agree as follows:
1. TERMINATION. Effective as of September 15, 1995, the
Employee and the Company have agreed that Employee's employment
with the Company is terminated without "Cause" (as defined in the
Original Termination Agreement).
2. ORIGINAL TERMINATION AGREEMENT. In accordance with the
terms of the Original Termination Agreement, Employee shall be
entitled to the following:
(a) 50% OF ANNUAL BASE SALARY. The Bank shall pay
Employee $80,000 (the "Termination Payment"), which is 50% of the
annual base salary Employee would have been paid for 1995 (if
Employee had remained employed by the Company for the full 1995
calendar year). The Termination Payment shall be paid in equal
installments on the Company's normal payroll dates for a period of
6 months, beginning on September 15, 1995 and ending on March 15,
1995 (the "Final Payment Date"). Hereinafter, this 6-month period
during which Employee shall be paid the Termination Payment
installments shall be referred to as the "Termination Payment
Period".
(b) PRO RATA INCENTIVE COMPENSATION PAYMENT. The Bank
shall pay Employee 8.5/12 of the 1995 incentive compensation
payment to which Employee would have been entitled (if Employee had
continued to be employed by the Company through 1995 year-end).
Such payment shall be made during the first calendar quarter of
1996 in accordance with the terms of the Bank's incentive
compensation policy, which terms include, without
79
limitation, payment of no incentive compensation award in the event that
the Employee receives an unsatisfactory performance rating for 1995.
(c) ACCELERATION OF STOCK OPTIONS. All of Employee's
stock options and shares granted to Employee under Bancshares' 1989
Stock Option Plan, as amended ("Plan"), immediately shall become
100% vested. The options may be exercised at any time within 3
months after the date of Employee's termination by the Company. A
list of all such stock options and shares held by Employee as of
the effective of this Agreement are set forth in Exhibit A, which
is attached to the Agreement and incorporated by reference herein.
(d) REIMBURSEMENT OF GROUP MEDICAL, VISION AND DENTAL
PREMIUMS/LIFE INSURANCE PREMIUMS. In the event Employee elects to
continue the group medical, vision, and dental benefits, as well as
life insurance benefits (including conversion of group life
insurance to individual life insurance benefits) provided to him
prior to the effective date of termination under the provisions of
COBRA, the Bank shall reimburse Employee for the cost of COBRA
continuation premiums paid by him for such group medical, vision,
and dental, and life insurance benefits until the earlier of (i)
the Final Payment Date or (ii) the date on which Employee becomes
eligible for coverage under any other employer's group medical
benefits plan.
(e) OUTPLACEMENT SERVICES. The Bank shall reimburse
Employee for the actual cost to Employee of reasonable and
appropriate executive outplacement services provided by deRecat and
Associates.
3. PAYMENT OF VESTED BENEFITS. As of the effective date of
this Agreement, all accrued and unused vacation, less applicable
withholding and Employee-designated deductions, shall be paid to
Employee. Employee's benefits under the Company's 401(k) and
Employee Stock Ownership Plan and Employee Stock Purchase Plan
shall be distributed to Employee in accordance with applicable
provisions of the plan documents governing such distributions.
4. INELIGIBILITY TO PARTICIPATE IN PLANS. Unless otherwise
provided in this Agreement, Employee acknowledges and understands
that he is not entitled to continued participation in any benefit
plans previously provided to him by the Company, including without
limitation, the 401(k) and Employee Stock Ownership Plan, Employee
Stock Purchase Plan, Flex Plan, and Group Long-Term Disability
Benefits.
5. PAYMENT OF WAGES DUE. Employee acknowledges and
represents that the consideration for this Agreement is not accrued
salary, wages or vacation, and is in excess of any established
severance practice or policy of the Company, and further
acknowledges that California Labor Code Section 206.5 is not
applicable to this Agreement or to the parties hereto. That
section provides in pertinent part:
No employer shall require the execution of any
release of any claim or right on account of
wages due, or to become due, or made as an
advance on wages to be earned, unless payment
of such wages has been made.
6. RELEASE. Except as expressly set forth herein, Employee
agrees that the consideration provided for in this Agreement
represents settlement in full of all outstanding obligations owed
to Employee by the Company. Employee, on behalf of himself and his
heirs, executors, and assigns, hereby fully and forever releases
Company and its officers, directors, employees, predecessor,
subsidiary and successor corporations, and assigns, of and from,
and agrees not to xxx concerning, any claim, duty, obligation or
cause of action relating to any matters of any kind, whether
presently known or unknown, suspected or unsuspected, that he may
possess arising from any omissions, acts or facts that have
occurred up to and including the effective date (as defined below)
of this Agreement, including, without limitation,
(a) any and all claims relating to or arising from
Employee's employment and/or termination of employment with the
Company;
(b) any and all claims for violation of any federal,
state or municipal statute, including but not limited to Title VII
of the Civil Rights Act of 1964, the Civil Rights Act of 1991, the
Age Discrimination in Employment Act of 1967,
80
the Americans With Disabilities Act of 1990, the Employee Retirement
Income Security Act, and the California Fair Employment and Housing Act;
and
(c) any and all claims arising out of any other laws and
regulations relating to employment or employment discrimination.
7. SECTION 1542 WAIVER. The provisions of Section 1542 of
the Civil Code of the State of California are expressly waived by
Employee, and Employee understands that it provides:
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.
8. NON-ADMISSION. Employee understands and acknowledges
that this Agreement constitutes a compromise and settlement of all
differences between Employee and the Company, that the liability
for any and all claims has been and is denied by the Company, and
this final compromise and settlement of all claims shall never be
deemed to be, nor construed as, an admission of liability or
responsibility by either party to the other party or to any third
party, at any time for any purpose.
9. CONFIDENTIALITY. The Company and Employee agree to use
their best efforts to maintain in confidence the existence of this
Agreement and its terms and conditions, and the consideration for
this Agreement. The Company and Employee agree to take every
reasonable precaution to prevent disclosure of any of the terms and
conditions of this Agreement to any third party, and further agree
that there will be no publicity, directly or indirectly, concerning
this Agreement or any of its terms and conditions unless agreed to
by the Company and Employee or unless they are legally compelled to
do so. The Company and Employee further agree to take every
precaution to disclose information concerning this Agreement only
to those employees, officers, directors, attorneys, accountants,
governmental entities, and family members who have a reasonable
need to know of such information. Notwithstanding the foregoing,
nothing in this Agreement shall be construed to prevent the Company
from disclosing this Agreement or any of its terms in a proxy
statement or to government regulatory agencies.
10. TAX CONSEQUENCES. The Company makes no representations
or warranties with respect to the tax consequences to Employee
under the terms of the Agreement including without limitation, with
regard to the acceleration of stock options provided for in this
Agreement. Employee and the Company agree that all sums paid under
Paragraph 2 of this Agreement shall be subject to normal federal
and state payroll tax withholding.
11. SEPARABILITY. Should any part, term or provision of this
Agreement be declared or determined by any Court or other tribunal
to be illegal, invalid or unenforceable, any illegal, invalid or
unenforceable part, term or provision shall be deemed stricken from
this Agreement and all of the other parts, terms and provisions of
this Agreement shall remain in full force and effect to the fullest
extent permitted by law.
12. EFFECTIVE DATE. The Company and Employee agree that
Employee shall have the right to revoke this Agreement for a period
of seven (7) calendar days after signing it, and that this
Agreement shall become effective on the eighth (8th) calendar day
after Employee has signed this Agreement.
13. BREACH OF AGREEMENT/ARBITRATION. In the event of a
breach of the representations or the obligations set forth in this
Agreement, the sole and exclusive remedy for such breach shall be
through final and binding arbitration, in which the prevailing
party shall be entitled to recover all provable damages,
consequential or otherwise, in addition to such other remedies as
may be available under this Agreement, at law or in equity. Any
arbitration hearing under this provision shall be held in the
County of Santa Clara, California.
14. COSTS AND ATTORNEYS' FEES. Should any action be brought
to enforce any of the terms or conditions of this Agreement, the
prevailing party shall be entitled to recover all costs and
expenses incurred in the prosecution or defense of that action,
including attorneys' fees.
81
15. GOVERNING LAW. This Agreement shall be governed by the
laws of the State of California.
16. NO ORAL MODIFICATION. This Agreement may only be amended
in writing, signed by both Employee and the Chief Executive Officer
of the Company.
17. VOLUNTARY EXECUTION OF AGREEMENT. Employee agrees that
this Agreement is executed by him voluntarily and without any
duress or undue influence on the part or behalf of the parties
hereto, with the full intent of releasing all claims. Employee
acknowledges that: (a) he has read this Agreement; (b) he has been
given a reasonable period of time to consider the legal effects of
this Agreement; (c) he has been represented in the preparation,
negotiation, and execution of this Agreement by legal counsel of
his own choice; (d) he understands the terms and consequences of
this Agreement and of the releases it contains; and (e) he is fully
aware of the legal and binding effect of this Agreement.
18. SUCCESSORS. This Agreement and the respective rights and
obligations of the parties hereunder shall inure to the benefit of,
and be binding upon, their respective successors, assigns and legal
representatives. This provision with respect to Employee's right
of successorship shall, however, inure only to the benefit of
Employee's estate, executor, administrator, and heirs.
19. ENTIRE AGREEMENT. This Agreement represents the entire
agreement and understanding between the Company and Employee, and
supersedes and replaces any and all prior agreements and
understandings between Employee and the Company.
20. ADDITIONAL TIME. Employee acknowledges that he has been
advised that he could have twenty-one (21) days to consider this
Agreement and that he was informed that he has the right to consult
with counsel regarding this Agreement and he has consulted with
counsel regarding this Agreement. To the extent that Employee has
taken less than twenty-one (21) days to consider this Agreement,
Employee acknowledges that he has had sufficient time to consider
the Agreement and to consult with counsel and that he does not
desire additional time.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
XXXXXX X. XXXXXXX, an individual
----------------------------------
SILICON VALLEY BANCSHARES
By:
--------------------------------
Xxxx X. Xxxx, Xx.
President and Chief Executive Officer
SILICON VALLEY BANK
By:
-----------------------------------
Xxxx X. Xxxx, Xx.
President and Chief Executive Officer
82
