EXHIBIT 10.9
GENERAL RELEASE OF ALL CLAIMS,
COVENANT NOT TO SUE
AND CONFIDENTIALITY OF AGREEMENT
I, Xxxxxx X. Xxxxxxxxxxx, on behalf of myself, my representatives, heirs,
executors, administrators, successors, and assigns, (hereinafter collectively
referred to as "I/me"), and NETWORK EQUIPMENT TECHNOLOGIES, INC., its affiliated
and subsidiary entities, and the officers, directors, agents, employees,
attorneys, successors, and assigns of all of them (hereinafter collectively
referred to as "N.E.T."), agree as follows:
1. I am currently employed by N.E.T. as its President and CEO.
2. N.E.T. and I wish to preserve the good will that exists between us while
settling all disputes that may exist between us and avoiding further
controversies.
3. N.E.T. and I mutually agree to sever our employer/employee relationship
effective on March 31, 1999, or the date a successor to my position is
named (which shall be no later than May 31, 1999), whichever comes later,
("termination date").
4. In consideration for this agreement, N.E.T. agrees to furnish the
following:
a. Continuation of my salary at the gross rate of $400,000.00 per annum,
for a period of up to three years from the termination date.
b. During the third year following the termination date, I may receive
salary continuation at the gross rate of $400,000.00 per annum, less
any salary I am earning from work. Any payments pursuant to this
subparagraph is money in addition to anything I would already be
entitled and is consideration for my agreement to this separation
agreement and release. Should I secure employment at any time during
the third year after the termination date, I shall immediately inform
the Sr. Vice President of Corporate Services of N.E.T.
c. All salary continuation discussed in paragraph a above will be paid
pro rata on a bi-weekly basis, in accordance with regular payroll
practices, less all applicable payroll deductions as required by law.
Unless I direct otherwise in writing, checks will be either direct
deposited or mailed to me at the following address: 0000 Xxx Xxxxx
Xxxxx, Xxxxx Xxxx, XX 00000.
d. I shall be eligible to receive a Variable Compensation Payment for
fiscal year 99 only, if any Variable Compensation is granted to other
eligible N.E.T. officers. The Variable Compensation payment to me, if
any, shall be calculated in a manner that is consistent with payments
made to other N.E.T. officers, and such payment, if any, shall be made
to me at the same time that similar payments are made to the other
N.E.T. officers.
e. Continuation of medical, dental, life and disability insurance during
the period of salary continuation, up to a maximum of three years.
Notification under COBRA will be issued on the termination date.
EXHIBIT 10.9
f. Immediate payment on the termination date of deferred, Long Term
Variable Compensation bonus from fiscal years 1996 ($100,000), 1997
($41,250), and 1998 ($110,000), for a gross total of $251,250.00, plus
any Long Term Variable Compensation bonus to which I would be entitled
during fiscal year 1999. The deferred Long Term Variable Compensation
payment to me, if any, shall be calculated in a manner that is
consistent with any deferred Long Term Variable Compensation bonus
awarded to other N.E.T. officers.
g. Continuation of my automobile allowance of up to $500.00 per month and
my tax planning allowance of up to $2,500.00, per annum during the
period of salary continuation, up to a maximum of three years from the
termination date.
h. Immediate vesting on the termination date of all shares of
non-qualified stock options and all shares of restricted stock
options, plus any 1999 grant of stock optionsfor which I am eligible
pursuant to the N.E.T. Stock Option Agreement. These options may be
exercised during their remaining term.
i. Any accrued vacation as of the termination date will be paid out to me
by the termination date. Vacation will cease accruing on the
termination date.
j. Reasonable steps will be taken by N.E.T. to assure that my telephone
extension will remain active to voice mail until the date salary
continuation ends. I agree to promptly advise N.E.T. in the event that
this voice mail benefit is no longer needed by me.
k. I agree the consideration I will receive in this paragraph 4 is in
addition to anything to which I would already be entitled and is
consideration for my agreement to this separation agreement and
release.
5. For and in consideration of the obligations of N.E.T. incurred in Section 4
of this General Release of All Claims, Covenant Not To Sue And
Confidentiality Agreement (hereinafter Release), I hereby completely
release and forever discharge N.E.T. from all claims, rights, demands,
actions, obligations, liabilities, debts, causes of action if any and every
kind, nature and character whatsoever, known or unknown, which I may now
have or have ever had against N.E.T. (hereinafter, all claims), including
without limitation all claims arising from or in any way connected with my
employment by N.E.T. or the termination of that employment, whether based
in tort or contract (express or implied), or on any federal, state or local
law, statute, or regulation, and all claims I may have filed or caused to
be filed in any court of law before any state or federal administrative
agency before the execution of this Release.
6. I understand and agree that in consideration of the foregoing I am waiving
any rights I may have had, now have, or in the future may have to pursue
any and all remedies available to me under any employment-related cause of
action against N.E.T., including without limitation, claims of wrongful
discharge, emotional distress, defamation, breach of contract, breach of
the covenant of good faith and fair dealing, vacation pay after the
resignation date, violation of the provisions of the California Labor Code,
the California Fair Employment and
EXHIBIT 10.9
Housing Act, any claims under federal or California statutory or decisional
law pertaining to wrongful discharge, discrimination, retaliation, or
breach of public policy, any claims arising under Title VII of the Civil
Rights Act of 1964, as amended, the California Constitution, the Equal Pay
Act of 1963, the Age Discrimination in Employment Act of 1967 as amended
("ADEA"), the Civil Rights Act of 1866, the Employee Retirement Income
Security Act, and any other laws and regulations relating to employment. In
order to assure that this waiver of rights under the ADEA is effective, I
hereby acknowledge and agree that I may have, and have had, at least 21
days after receipt of this Release within which to review, consider and
discuss this Release with an attorney of my choosing and to decide whether
or not to execute this Release. I understand that I have seven (7) days
after execution of this Release within which to revoke this Release by
providing to the Sr. Vice President of Corporate Services of N.E.T. a
signed, written statement revoking this Release. Finally, I understand and
agree that this Release shall not become effective and that I shall not be
entitled to any consideration hereunder (even if already received) until
such seven (7) day period has expired without any revocation.
7. I understand and agree that this is a full and final release covering all
known, unknown and unanticipated injuries, debts, claims, or damages to me
which have arisen or may have arisen in connection with my employment with
N.E.T., as well as those injuries, debts, claims or damages not now known
or disclosed which may arise from my employment, as specifically described
above. I understand that Section 1542 of the California Civil Code,
provides as follows:
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.
The provisions of Section 1542 of the California Civil Code and any
analogous state or federal law, if any way applicable, are hereby waived by
me. I specifically affirm my intention to release not only those claims I
know but also those claims against N.E.T. that I may not know about.
8. I agree that I will not initiate or cause to be initiated against N.E.T.
any compliance review, suit, action, investigation, or proceeding of any
kind, or participate in same, individually or as a representative or member
of a class, whether federal, state, or local, pertaining in any way to any
matter herein released, unless I am required to do so by law. I further
agree that I have no right to future employment with N.E.T. and that N.E.T.
will have no obligation to re-employ me at any time in the future.
9. I will maintain both the fact and terms of this Release and any
consideration that I receive in strict confidence, and will not disclose
the fact of this Release or any of its terms, including the fact or amount
of any payment to any other person or entity (other than my spouse, my
attorney and accountant in this matter solely for use in providing counsel
and advice to me in this matter) for any reason, at any time, without the
prior written consent of N.E.T., unless required by law. N.E.T. agrees to
maintain the fact and terms of this Release, and payments under this
Release in confidence, except for those agents, employees and
EXHIBIT 10.9
representatives of N.E.T. will be relieved of any obligation to make future
payments to me under this agreement; that I will refund one-half of all
sums previously paid to me hereunder and that N.E.T. will be entitled,
without limitation, to pursue legal and equitable remedies for such
violation.
10. I represent and warrant that I do not have in my possession, and that I
have not failed to return to N.E.T. (a) any records, documents, data,
specifications, drawings, blueprints, reproductions, sketches, notes,
reports, proposals, or copies of the foregoing, or other documents or
material, or (b) any equipment or other property belonging to N.E.T. or any
of its subsidiaries or employees except the following, which I am keeping
as part of the consideration under this agreement:
PC, N.E.T. asset no. 022959, serial no. 9827BYQ3D694
Monitor, serial no. 7163736
Printer, serial no. 567BLB818W
PowerMac 7200/90, N.E.T. asset no. 019676, serial no. FC602C4355F
Apple Monitor serial no. 515161VH1XX
Nokia 6160 cell phone, serial no. 23513816024
11. I represent and warrant that I have complied with and will continue to
comply with all terms of the N.E.T. Employee Proprietary or Confidential
Information and Inventors Agreement signed by me (a copy of which is
attached hereto and incorporated herein by this reference), including,
without limitation, refraining from soliciting N.E.T. employees; reporting
to N.E.T. any inventions (as defined therein) conceived or made by me; and
preserving as confidential all trade secrets, confidential information,
knowledge, data or other confidential information relating to products,
processes, know-how, designs, formulas, test data, customer lists, customer
information, employees, the abilities of employees or other confidential
subject matter pertaining to any business of N.E.T. or any of its clients,
customers, licensees or affiliates.
12. I understand and agree that the furnishing of the consideration for this
Release will not be deemed or construed at any time for any purpose as an
admission of liability or wrongdoing by N.E.T. Liability for any and all
claims is expressly denied by N.E.T. I further understand and agree that
each of the releases, waivers and other provisions of Sections 5 through 11
and the covenants contained in Section 15 are material inducements to
N.E.T. for entering into this Release and that, for the breach of any of
them N.E.T. will be entitled to pursue legal and equitable remedies,
including without limitation, the right to seek restitution and injunctive
relief.
13. This Release shall be deemed to have been entered into in the State of
California by residents of that state and shall be construed and enforced
in accordance with and governed by the laws of that state.
14. Should any part, term or provision of this Release be declared or
determined by any court to be illegal or invalid, the validity of the
remaining parts, terms, or provisions will not be affected thereby and said
illegal or invalid part, term, or provision will be deemed not to be a part
of this Release.
EXHIBIT 10.9
15. N.E.T. and I will fully cooperate in any internal N.E.T. or external
investigations or litigation concerning or relating to N.E.T. and any of
N.E.T.'s or my activities during the time that I was employed by N.E.T.
N.E.T. and I will promptly advise the other of any formal or informal
requests for information or cooperation that may concern or relate to the
interests of the other in connection with any such investigation or
litigation.
16. During the period I am receiving salary continuation from N.E.T., unless I
receive written permission to do so, I will not become employed by nor be a
consultant to any person or company that I know or reasonably should have
known at the time of commencing such relationship competes directly with
products or services marketed by N.E.T. If I breach this agreement, in
addition to any other remedies N.E.T. may have, N.E.T.'s obligation to
provide me any salary continuation will cease immediately.
17. I acknowledge that I have been given at least 21 days to review the
foregoing Release to and to consult counsel of my own choice concerning the
waivers, releases and other provisions before signing this Release, that I
am fully aware of the contents of this Release and of its legal effect,
that the preceding paragraphs recite the sole consideration for this
Release, that all agreements and understandings between N.E.T. and me are
embodied and expressed herein, and that I enter into this Release freely,
without coercion, and based on my own judgment and not in reliance upon any
representations or promises made by N.E.T. or anyone, other than those
contained herein. Except as expressly provided herein, this Release shall
supersede and render null and void any and all prior agreements between the
parties. This Agreement specifically supersedes the provisions regarding
pay due at termination of employment contained in the CEO Employment
Continuation Agreement, signed April 14, 1998. This Release may not be
modified except in a writing signed by me and the Sr. Vice President of
Corporate Services of N.E.T.
18. Should I at any time contest the validity or enforceability of this
Release, I agree to immediately repay to N.E.T. any and all monies and
other consideration that have been provided to me by N.E.T. pursuant to
this Release.
Date: January 26, 1999 /s/ Xxxxxx X. Xxxxxxxxxxx
---------------------------
Xxxxxx X. Xxxxxxxxxxx
Network Equipment Technologies, Inc.
By: /s/ Xxxxx X. Xxxxxx
--------------------------------
Its: Sr. VP Corporation Services
Date: January 26, 1999
