SEPARATION AGREEMENT AND RELEASE
This Separation Agreement and Release of Claims ("Agreement") is made by and
between Xxx Xxxxxxx ("Employee") and Calypte Biomedical Corporation (the
"Company" OR "Employer"), and all subsidiaries, affiliates and/or joint venture
companies of Employer.
The ("Company") has elected to provide Employee with Severance Payments.
NOW THEEFORE, in consideration of the mutual promises and releases contained
herein and for other good and valuable consideration, the sufficiency of which
is hereby acknowledged, the parties agree as follows:
1. Upon the execution of this Agreement:
a. Employee shall be terminated from Employment with Calypte
Biomedical Corporation effective January 19, 2004.
b. Employee will have the right to elect to continue, at his
cost, coverage under the Calypte Biomedical Corporation Health
Plan, in accordance with the health care continuation coverage
provisions of the Consolidated Omnibus Budget Reconciliation
Act of 1985 ("COBRA").
c. Employee will voluntarily resign as President and a Director
of Employer, annexed hereto is a true copy of Employee's
resignation. Additionally, Employee consents to the issuance
of the attached copy of a press release announcing Employee's
resignation as an officer and director.
d. Employee agrees that Employee will be bound by Sections 9 and
10 of his Employment agreement dated August 12, 2003 with
respect to confidentiality with Employer.
2. In consideration of the promises contained herein, the Company is
willing to provide Employee with the Severance Package outlined in
this Agreement and Release ("Agreement"), in exchange for and
subject to Employee's execution and non-revocation of this
Agreement. If the within agreement has not been revoked (as defined
in paragraph "8" below). Employee shall receive a Severance Package
that will include a Severance Payment equal to (12) months of salary
in monthly installment payments of ($ 29,166) per month ($350,000)
The first payment will be paid on the Release Effective Date (As
defined in Section 11) Employer will deduct the sum of $16,766.39
over three (3) consecutive monthly payments. Said sum is an advance
that was paid to Employee for travel expenses. In the event that
Employer obtains equity or debt financing, including without
limitation, any type of loan in, of the sum of at least $5,000,000
during the term hereof, Employer agrees to pay the balance of any
monthly installments due to Employee. In addition, Employer agrees
to award Employee effective January 15, 2004, 750,000 stock options
to purchase 750,000 shares of common stock, at $.32 per share under
Employer's Employee stock option plan, which grant shall vest the
earlier of the Release Effective Date (as defined in section 11) or
January 14, 2005, and to pay reasonable attorneys fees to Employee
for his appearance if required at the Securities and Exchange
Commission, as well as indemnify Employee in accordance with
Delaware law. The Severance is not subject to applicable payroll
withholding deductions. You will then be entitled to participate in
the Company's group Medical Plan pursuant to COBRA (as defined in
paragraph "1").
1
SEPARATION AGREEMENT AND RELEASE
3.
a. In consideration for the Severance Package provided to Employee
pursuant to this Agreement, Employee for himself and for his heirs,
executors, and assigns (hereinafter collectively referred to as the
"Releasors"), forever releases and discharges the Company and any
and all of its parent corporations, subsidiaries, divisions,
affiliated entities, predecessors, successors and assigns, and any
and all of its or their Employee benefit and /or pension plans or
funds, and any of its or their past or present officers, directors,
stockholders, agents, trustees, administrators, Employees or assigns
(whether acting as agents for such entities or in their individual
capacities) (hereinafter collectively referred to as "Releasees"),
from any and all claims, demands, causes of action, fees and
liabilities of any kind whatsoever (based upon any legal or
equitable theory, whether contractual, common-law, statutory,
federal, state, local or otherwise), whether known or unknown, which
Releasors ever had, now have or may have against Releasees by reason
arising out of or in any way connected with Employee's Employment
with the Company, the termination of or decision to terminate such
Employment, and/or any of the events relating directly or indirectly
to or surrounding that termination; or any other transactions,
occurrences, acts or omissions or any loss , damage or injury
whatever, known or unknown, suspected or unsuspected, resulting from
any of them, committed or omitted prior to the date of this
Agreement, and including, without limitation, claims for breach of
contract, libel, slander, wrongful discharge, intentional infliction
of emotional harm, or other tort, or discrimination or harassment
based upon any federal, state, or municipal statute or local
ordinance relating to discrimination in Employment. And any claim
for attorneys' fees, costs, disbursements and/or the like. Or other
matter up to and including the Release Effective Date.
b. Without limiting the generality of the foregoing subparagraph "(a)",
this Agreement is intended to and shall release the Releasees from
any and all claims against Employer, whether, arising out of
Employee's Employment, or including but not limited to (i) any claim
under the Age Discrimination in Employment Act, as amended, or the
Older Workers Benefit Protection Act; (ii) any claim under Title VII
of the Civil Rights Act of 1964, as amended; (iii) any claim under
the Americans with Disabilities Act, as amended; (iv) any claim
under the Employee Retirement Income Security Act of 1974, as
amended ("ERISA") (excluding claims for accrued, vested benefits
under any Employee benefit plan of the Company in accordance with
the terms of such plan and applicable law); (v) any claim under the
Federal Family and Medical Leave Act ("FMLA"); (vi) any claim under
the Equal Pay Act; (vii) any claim under the California State Human
Rights Law, or any other Human Rights Law.
2
SEPARATION AGREEMENT AND RELEASE
c. This release shall not prevent Releasors from enforcing any rights
under this Agreement.
4. Employee agrees, to the maximum extent permitted by law, that he will not
commence, maintain, prosecute or participate as a party or a member of a
class in any action or proceeding of any kind against any of the Releases,
arising out of any act, omission, transaction or occurrence occurring up
to and including the Release Effective Date and warrants that he has not
done so as of the Release Effective Date.
5. Employee further agrees except as otherwise provided in paragraph "3c",
that he will not seek or accept any award or settlement from any source or
proceeding with respect to any claim or right covered by paragraphs "3"
and "4".
6. The terms and conditions of this Agreement are and shall be deemed to be
confidential, and shall not be disclosed by Employee to any person or
entity without the prior written consent of the Company, except if
required by law (Securities and Exchange Commission Disclosure
Requirements) and to Employee's attorneys or family members, provided that
they agree to maintain the confidentiality of this Agreement. Employee
further represents that he has not disclosed the terms and conditions of
this Agreement to anyone other than his attorneys and family members.
7. Employee agrees that he has not and will not engage in any conduct that is
injurious to releasee's reputation or interest, including but not limited
to (i) divulging, communicating, or in any way making use of any
confidential or proprietary information acquired in the performance of
duties for Releasees; and (ii) publicly disparaging (or inducing others to
publicly disparage) Releasees, including making comments or statements
which would adversely affect the Company to the press, the Company's
Employees or individuals or entities with whom the Company has a business
relationship. If The Company receives any inquiries from prospective
Employers concerning Employee, the Company agrees that it will respond to
such inquiries by stating his separation from the Company was amicable and
on good terms and pursuant to Company policy, it will provide Employee's
dates of Employment and Employee's last title with the Company.
8. Consultation and Cooperation by Employee agrees to make himself reasonably
available to the Company, at mutually agreed times and places, to respond
to requests by the Company for information concerning facts or events
relating to The Company that may be within his knowledge. Employee will
cooperate fully with the Company or any of its officers and directors, in
connection with any or all future litigation or regulatory proceedings
brought by or against the Company to the extent The Company reasonably
deems Employee cooperation either necessary or helpful. In the event that
the Company requires Employee cooperation, the Company agrees to pay any
of Employee reasonable expenses in providing such cooperation (such as
travel and accommodations).
3
SEPARATION AGREEMENT AND RELEASE
9. Confidentiality. The parties further agree that the terms of this
Agreement, and the negotiations leading up to it, shall not be disclosed
by the parties to any person, other than in a proceeding to enforce the
terms of this Agreement or pursuant to valid subpoena or court order, with
the exception of the parties' lawyers, accountants, tax preparers and,
with respect to Employee, immediate family, provided that the parties
inform any such persons that they must not disclose the same to any person
and they agree to that condition. In response to any inquiry from third
parties, the parties and their attorneys may state only that the parties
have resolved the matter.
10. Non-Disparagement. Employee and the Company agree that, except for
truthful statements in any proceeding to enforce this Agreement or
pursuant to a valid Subpoena or Court Order, neither will make or publish
any statement (orally or in writing) that becomes or reasonably could be
expected to become publicly known, or instigate, assist or participate in
the making or publication of any such statement, which would libel,
slander or disparage (whether or not such disparagement legally
constitutes libel or slander) the other or, with respect to the Company,
any of its affiliates or any other entity or person within the Company or
its affiliates, any of their affairs or operations, or the reputations of
any of their past or present officers, directors, agents, representatives
and Employees.
11. Employee shall have twenty-one (21) days from the date of receipt to
consider the terms and conditions of this Agreement. If the terms of this
Agreement meet Employee's approval, Employee may accept this Agreement by
signing it and returning it to Employer. Further, Employee may sign and
return this Agreement at any time within this period. After signing this
Agreement, Employee shall have seven (7) days to revoke this Agreement
("Revocation Period") by indicating he desire to do so in writing that is:
(a) addressed to Employer at the address listed above, and (b) received by
he no later than the seventh (7th) day following the date Employee signs
this Agreement. The effective date of this Agreement shall be the eighth
(8th) day following Employee's signing of this Agreement (the "Release
Effective Date"), provided Employee does not revoke this Agreement during
the revocation Period. In the event Employee does not accept this
Agreement as set forth above, or revokes this Agreement during the
Revocation Period, this Agreement including but not limited to the
obligation of the Company and its subsidiaries and affiliates to provide
the payment referred to in paragraph "2" above, shall automatically be
deemed null and void, in addition to the stock options being immediately
cancelled.
12. Employee acknowledges that: (a) he has carefully read this Agreement in
its entirety; (b) he has been advised by the Company in writing to consult
with an attorney of he choosing in connection with this Agreement; (c) he
fully understands the significance of all of the terms and conditions of
this Agreement; (d) he has discussed it with his independent legal
counsel, or has had a reasonable opportunity to do so; (e) he has had
answered to his satisfaction any questions he has asked with regard to the
meaning and significance of any of the provisions of this agreement; and
(f) he is signing this Agreement voluntarily and of his own free will and
assents to all the terms and conditions contained herein.
4
SEPARATION AGREEMENT AND RELEASE
13. The making of this Agreement is not intended, and shall not be construed,
as an admission that Releasees have violated any federal state or local
law (statutory or decisional), ordinance or regulation, breached any
contract, or committed any wrong whatsoever against Employee. The payment
of Severance Benefits to Employee will not be considered an admission of
any liability on the part of the Company with respect to any claims or
potential claims made by Employee.
14. This Agreement is binding upon, and shall inure to the benefit of, the
parties and their respective heirs, executors, administrators, successors
and assigns.
15. This Agreement shall be interpreted, construed, governed and enforced
according to the laws of the State of California, and the parties in any
action arising out of this Agreement shall be subject to the jurisdiction
and venue of the federal and state courts, as applicable in the State of
California.
a. If any provision of this Agreement shall be held by a court of court
of competent jurisdiction to be illegal, void, or unenforceable,
such provision shall be of no force and effect. However, illegality
or unenforceability of such provision shall have no effect upon, and
shall not impair the enforceability of, any other provision of this
Agreement; provided, however, that, upon any finding by a court of
competent jurisdiction that the release and covenants provided for
by paragraphs "3" and "4" of this Agreement are illegal, void, and
unenforceable or not entered into knowingly and voluntarily,
Employee agrees, at the Company's option, either to return promptly
to the Company the Enhanced Severance paid to he pursuant to this
Agreement or to execute a release, waiver and/or covenant that is
legal and enforceable.
b. If Employee seeks to challenge the validity of or otherwise vitiate
this Agreement or any provision thereof (including, without
limitation, paragraphs "3" and "4"), Employee, to the maximum extent
permitted by law, shall, as a precondition, be required to repay to
the Company the severance paid to he pursuant to the terms of this
Agreement.
c. Any breach of the terms of paragraphs "4", "6", "7", "8", "9" and/or
"10" shall constitute a material breach of this Agreement as to
which the Company may seek appropriate relief (including, but not
limited to repayment of the Severance paid to Employee under this
Agreement) in a court of competent jurisdiction.
d. Employee further agrees that any claim or counterclaim made by the
Company to enforce the terms of this Agreement shall not be deemed
retaliatory.
16. The parties agree that this Agreement may only be used as evidence in a
subsequent proceeding in which any of the parties allege a breach of this
Agreement.
5
17. This Agreement (together with the accompanying cover letter) constitutes
the complete understanding between the parties and supersedes any and all
agreements, understandings, and discussions, whether written or oral,
between the parties. No other promises or agreements shall be binding
unless in writing and signed after the Release Effective Date by the
parties to be bound thereby.
ACCEPTED AND AGREED TO:
EMPLOYEE
By: /s/ Xxx Xxxxxxx Date: 19 Jan 04
-------------------------------- ----------
Xxx Xxxxxxx
State of California )
) ss:
County of )
On this _____ day of ____________, 2004, before me personally came Xxx Xxxxxxx
to me known and known to me to be the person described herein, and who executed
the foregoing Agreement and Release, and he duly acknowledged that he executed
the same.
-----------------------------------
Notary Public
ACCEPTED AND AGREED TO:
CALYPTE BIOMEDICAL CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxx Date: 19 Jan 04
-------------------------------- -----------
Chairman
6
