SEVERANCE AND GENERAL RELEASE AGREEMENT
Exhibit 10.14
This Severance and General Release Agreement (“Agreement”) is made and entered into by and
between Xxxxxxx Xxxxxxxxx (“Employee”), an individual, and Xxxxxx.xxx, Inc. (“Youbet”), upon the
following terms and conditions:
RECITALS
WHEREAS, Employee gave notice to Youbet on July 29, 2005 (the “Resignation Date”) of his
decision to resign from employment with Youbet as of a date no later than August 1, 2005 (the
“Separation Date”);
WHEREAS, Youbet has accepted Employee’s resignation and agreed to his separation of employment
on or before the Separation Date, upon the terms and conditions set forth in this Agreement;
WHEREAS, Youbet will provide Employee with severance pay and certain other consideration, upon
the terms and conditions set forth in this Agreement;
WHEREAS, Employee has had the opportunity to consult with legal counsel before signing this
Agreement, has read this Agreement and understood its contents, and has signed this Agreement
voluntarily.
NOW, THEREFORE, in consideration of the mutual promises, consideration, covenants, and
conditions provided for in this Agreement, the adequacy and sufficiency of which are hereby
acknowledged, and intending to be legally bound, Youbet and Employee agree as follows:
COVENANTS
1. Effective Date. Once signed by both parties, this Agreement shall become binding
upon Youbet and Employee on the later to occur of (a) the date upon which this Agreement has been
signed by Youbet, or (b) eight (8) days after this Agreement has been signed by Employee (the
“Effective Date”).
2. Confidential Information. Employee shall return to Youbet, and shall not take or
copy in any form or manner, customer lists, operations manuals, budgets and business plans,
strategic plans, financial statements and other financial information concerning Youbet or its
customers, and other confidential or proprietary materials or information which are governed by the
terms of that certain agreement (the “Confidentiality Agreement”) between Employee and Youbet, a
copy of which is attached hereto as
Exhibit A, which agreement is hereby ratified by the parties and shall remain in full force and
effect.
3. Payments. In consideration for Employee entering into this Agreement and the
release contained herein, Youbet agrees as follows:
A. Youbet shall provide Employee with a severance payment in a lump sum equal to 12 months
of his annual base salary ($180,000), less all applicable withholdings, deductions and taxes, to be
paid to
Employee on the next regularly scheduled pay date following the Effective Date.
B. Youbet shall reimburse Employee for customary outplacement services, up to a maximum amount
of $5,000. In order to be eligible for reimbursement, Employee must obtain authorization from
Youbet prior to engaging or utilizing any outplacement services (including approval of the costs or
expenses to be incurred by Employee) and must submit appropriate documentation of the actual
expenses incurred by Employee.
C. Nothing in this Agreement shall be deemed to terminate Youbet’s obligation to reimburse
Employee for all reasonable and documented business expenses incurred by him prior to the
Separation Date within 30 days after submission of a written expense report (provided that (a)
Youbet receives the same within 90 days after the Separation Date, and (b) such expenses were
incurred, and the request for reimbursement was submitted, in accordance with Youbet’s policies and
procedures, including attaching all receipts and customary documentation).
D. Subject to paragraphs 3A and 3B above, (a) all fringe benefits (such as, if applicable,
participation in the 401(k) plan and the continuation of group health and disability insurance and
group life insurance benefits) will cease as of the Separation Date, and (b) Employee acknowledges
that he has been informed that he may elect the existing group health benefits, effective as of the
Separation Date, under the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA).
E. If Employee elects existing group health benefits under COBRA, Youbet will pay for
Employee’s COBRA premiums on a monthly basis through December 31, 2005, or until Employee becomes
eligible for group medical insurance with another employer, whichever comes first.
F. Reimbursement for customary outplacement services and payment of Employee’s COBRA premiums,
in accordance with paragraphs 3B and 3E above, are further contingent upon Employee providing
Youbet with reasonable cooperation, if so requested, with respect to any of Youbet’s business or
legal affairs, including but not limited to providing Youbet with information, documents, records
and reasonable assistance, and being available upon reasonable notice to meet with Youbet
representatives.
4. Release.
A. Except for the obligations set forth in this Agreement, Employee, on behalf of himself,
his descendants, ancestors, dependents, heirs, executors, administrators, assigns and successors,
and each of them, hereby covenants not to xxx, and hereby fully releases and discharges, Youbet,
its subsidiaries and affiliates, past and present, and each of them, as well as its and their
respective partners, directors, officers, members, agents, attorneys, insurers, employees,
stockholders, representatives, assigns and successors, past and present, and each of them
(hereinafter collectively referred to as the “Releasees”), with respect to and from any and all
claims, wages, demands, rights, liens, agreements, contracts, covenants, actions, suits, causes of
action, obligations, debts, costs, expenses, attorneys’ fees, damages, judgments, orders and
liabilities of whatever kind or nature in law, equity or otherwise, whether now known or unknown,
suspected or unsuspected, which he now owns or holds or he has at any time heretofore owned or held
or may in the future hold as against said Releasees, arising out of or in any way connected with
his employment relationship with Youbet, or any other transactions, occurrences, acts or
- 2 -
omissions or any loss, damage or injury whatever, known or unknown, suspected or unsuspected, resulting from
any act or omission by or on the part of said Releasees, or any of them, committed or
omitted on or before the Effective Date of this Agreement including, without limitation, any
claim under Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000(e), et. seq.; the Age
Discrimination in Employment Act, 29 U.S.C. § 623, et. seq. (“ADEA”); the Americans with
Xxxxxxxxxxxx Xxx, 00 X.X.X. § 00000(x), et. seq.; the California Fair Employment and Housing Act,
California Government Code § 12940, et. seq.; the Employment Retirement Income Security Act of
1974, 29 U.S.C. § 100, et. seq.; the Fair Labor Standards Act, including the Equal Pay Act, 29
U.S.C. § 206 (d) and interpretive regulations; the Family and Medical Leave Act, 29 U.S.C. § 2601,
et. seq.; the Worker Adjustment and Retraining Notification Act, 29 U.S.C § 2101, et. seq.; the
Pregnancy Discrimination Act, 42 U.S.C. § 2000e (k); the California Family Rights Act, California
Government Code §12945.2; the California Labor Code (expressly including § § 203, 206, 218.5 and
the Equal Pay Act, § 1197.5); the United States and California Constitutions; and any other federal
or state law, severance pay, bonus, retention payment, sick leave, holiday pay, vacation pay, paid
time off, life insurance, health or medical insurance or any other employee or fringe benefit,
breach of contract, breach of the implied covenant of fair dealing, defamation, slander, workers’
compensation, disability, personal injury, negligence, discrimination, harassment, retaliation,
negligent or intentional infliction of emotional distress, fraud, misrepresentation or invasion of
privacy; provided, however, that nothing contained herein shall affect Employee’s rights (i) under
Youbet’s Stock Option Plan and the 200,000 options granted to Employee there under (including,
without limitation, the right to exercise Employee’s 62,500 vested options prior to the 90-day
anniversary of the Separation Date), and (ii) to receive (a) his current base salary, and accruals
of vacation and PTO, in accordance with existing company policy, through and including the
Separation Date, and (b) payment of any accrued and unused vacation and PTO on the Separation Date.
Neither this Agreement nor any term herein shall be deemed to be an admission by Youbet, or shall
be admissible in any proceeding as evidence, of any violation of any of Youbet’s policies or
procedures or any federal, state or local laws or regulations.
It is the intention of Employee in executing this Agreement that the foregoing general release
shall be effective as a bar to each and every claim, demand and cause of action specified
hereinabove. In furtherance of this intention, Employee hereby expressly waives any and all rights
and benefits conferred upon him by the provisions of SECTION 1542 OF THE CALIFORNIA CIVIL CODE, and
expressly consents that this Agreement shall be given full force and effect according to each and
all of its express terms and provisions, including those related to unknown and unsuspected claims,
demands and causes of action, if any, as well as those relating to any other claims, demands and
causes of action hereinabove specified. SECTION 1542 provides:
“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOW KNOW OR
SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF
KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE
DEBTOR.”
Employee acknowledges that he may hereafter discover claims or facts in addition to or
different from those which Employee now knows or believes to exist with respect to the subject
matter of this Agreement and which, if known or suspected at the time of executing this Agreement,
may have
- 3 -
materially affected the terms of this release. Nevertheless, Employee hereby waives any
right, claim or cause of action that might arise as a result of such different or additional claims
or facts. Employee acknowledges that he understands the significance and consequence of the foregoing release and
the specific waiver of SECTION 1542.
5. Notice re: Waiver of Age Discrimination Claims
A. Employee understands that this Agreement contains a full release of existing claims,
whether currently known or unknown, including age discrimination or other claims under the Age
Discrimination in Employment Act, 29 U.S.C. section 623, et. seq., as amended by the Older Workers’
Benefit Protection Act of 1990. Employee is hereby advised to consult with an attorney prior to
executing this Agreement and, by executing this Agreement, acknowledges that he has been afforded
at least twenty one (21) days to consider this Agreement and to decide whether to enter into this
Agreement, and in the event he should decide to execute this Agreement in fewer than 21 days, he
has done so with the express understanding that he has been given and declined the opportunity to
consider this Agreement for a full 21 days; and.
B. Employee has the right to revoke this Agreement within seven (7) days of signing it. To
revoke this Agreement, Employee must send a written letter by certified mail to:
Xxxxxx.xxx, Inc.
0000 Xx Xxxx Xxxxxx
Xxxxxxxx Xxxxx, XX 00000
Attention: General Counsel
0000 Xx Xxxx Xxxxxx
Xxxxxxxx Xxxxx, XX 00000
Attention: General Counsel
The letter must be postmarked within seven (7) days of the date that Employee signs this Agreement,
and shall clearly indicate Employee’s intent to revoke. If Employee revokes this Agreement, he
shall not receive the payment or consideration described in paragraphs 3A, 3B and 3E hereinabove.
6. Confidentiality. Employee agrees that the terms and conditions of this Agreement
shall be confidential, and that he shall not disclose them to any person (other than his attorneys,
professional advisors and any prospective employer (hereinafter referred to as “Employee’s
Confidants”), all of whom shall be informed of this confidentiality provision. Notwithstanding
anything to the contrary contained herein, Employee may disclose any information concerning this
Agreement in response to an order of a court of competent jurisdiction or in response to a lawfully
issued subpoena. Neither Employee nor Employee’s Confidants shall disclose the terms, or the
circumstances leading up to the execution, of this Agreement to anyone, including, but not limited
to, any representative of any print, radio or television media, or any past, present or prospective
employee of Youbet (other than Youbet’s senior management, legal, and human resources personnel),
or otherwise participate in or contribute to any public discussion concerning, or in any way
relating to, this Agreement or the events (including any negotiations) which led to its execution.
It is agreed that in the event of a breach of the provisions of this paragraph 7, it would be
impractical or extremely difficult to fix actual damages, and the parties therefore agree that in
the event of a breach, Employee shall pay to Youbet, as liquidated damages, and not as a penalty,
the sum
- 4 -
of Twenty Thousand Dollars ($20,000.00) which represents reasonable compensation for the
loss incurred because of such a breach, plus attorneys’ fees and costs incurred by Youbet.
7. No Lawsuits; Covenant Not to Xxx. Employee represents that, prior to signing this
Agreement, he has not filed or pursued any complaints, charges or lawsuits of any kind with any
court, governmental or administrative agency or arbitrator against Youbet or its officers,
directors, agents or employees asserting any claims that are released in this Agreement. To the
extent permitted by law, at no time after the Effective Date will Employee file, maintain, or
execute upon, or cause or permit the filing or maintenance or execution upon, in any state, federal
or foreign court, or before any local, state, federal or foreign administrative agency, or any
other tribunal, any judgment, charge, claim or action of any kind, nature and character whatsoever,
known or unknown, which he may now have, has ever had, or may in the future have against Releasees
which is based in whole or in part on any matter covered by paragraph 4 above.
8. No Representations. Employee represents and agrees that no promises, statements or
inducements have been made to him which caused him to sign this Agreement, other than those
expressly set forth in this Agreement.
9. No Assignment. Employee warrants and represents that he has not heretofore
assigned to any person any released matter or any portion thereof, and shall defend, indemnify and
hold harmless Youbet from and against any claim (including the payment of attorneys’ fees and costs
actually incurred, whether or not litigation is commenced) based upon, in connection with or
arising out of any such assignment made, purported or claimed.
10. No Reinstatement. Employee agrees that he will not at any future time seek
employment or reemployment with Youbet or any of its subsidiaries after the Separation Date.
Employee further agrees that Releasees shall not be liable for any damages now or in the future
because any Releasee refuses to employ Employee for any reason whatsoever.
11. Goodwill and Reputation of Youbet. As of the Effective Date, Employee agrees that
he will refrain from taking actions or making statements, written or oral, which disparage or
defame the goodwill or reputation of Youbet and its directors, officers and employees, or which
could adversely affect the morale of Youbet’s other employees.
12. Successors. This Agreement shall be binding upon Employee and upon his heirs,
administrators, representatives and executors, and shall inure to the benefit of the Releasees and
their respective heirs, administrators, representatives, executors, successors and assigns.
13. Integration. This Agreement constitutes the entire agreement and understanding
concerning Employee’s employment, his separation from the same and the other subject matters
addressed herein, and supersedes and replaces all prior negotiations and all agreements, proposed
or otherwise, whether written or oral, concerning the subject matter hereof, except that nothing
contained herein shall be deemed to terminate, modify or waive any provision of, or the rights and
obligations of the parties to, the Confidentiality Agreement.
- 5 -
14. Severability. If any provision of this Agreement or the application thereof to
any situation is held invalid, the invalidity shall not affect the other provisions or applications
of this Agreement which can be given effect without such invalid provisions or applications and, to
this end, the provisions of this Agreement are declared to be severable.
15. Waiver. No waiver of any breach of any term or provision of this Agreement shall
constitute a waiver of any other breach of this Agreement. No waiver shall be binding unless in
writing and signed by the party waiving the breach.
16. Amendments. This Agreement may be modified only by a written instrument signed by
the parties.
17. Governing Law. This Agreement shall be governed by California law, without regard
to such State’s rules concerning conflicts of laws. In connection with this provision of the
Agreement, the parties acknowledge that Youbet’s principal place of business is in Woodland Hills,
California, and that employment practices concerning the Employee (including the negotiation of
this Agreement) were decided upon and carried out to a significant degree in California.
I have read the foregoing Agreement, I accept and agree to the provisions it contains, and I
hereby execute it knowingly and voluntarily with full understanding of its consequences. I declare
that the foregoing statement is true and correct.
| /s/ Xxxxxxx Xxxxxxxxx | Date: August 2, 2005 | |||
| Xxxxxxx Xxxxxxxxx | ||||
| Accepted and agreed to by: XXXXXX.XXX, INC. |
||||
| By: | /s/ Xxxxxxx Xxxxxxxx | |||
| Name: | Xxxxxxx Xxxxxxxx | |||
| Title: | President and Chief Executive Officer | |||
| Date: | August 8, 2005 | |||
- 6 -
