SEVERANCE AGREEMENT AND RELEASE
This Severance Agreement and Release ("Severance Agreement") is entered
into between Vari-Lite, Inc., its related and affiliated companies
("Vari-Lite"), and Xxx Xxxxx ("Kinnu") on September 30, 1996, and is intended
to be a full and final resolution of all matters involving Kinnu's employment
by Vari-Lite Holdings, Inc.
WHEREAS, Kinnu has been employed by Vari-Lite Holdings, Inc. as Chief
Operating Officer since August 28, 1996, pursuant to the terms of an Employment
Agreement between Vari-Lite Holdings, Inc. and Kinnu dated August 28, 1996
("Employment Agreement"); and
WHEREAS, in support of Vari-Lite, Kinnu undertook, at the Chief Executive
Officer's request, the additional responsibilities of Vice President for
Product Development; and
WHEREAS, both parties to the Employment Agreement have fulfilled their
obligations and responsibilities pursuant to that Employment Agreement to
this date; and
WHEREAS, the Chief Executive Officer has made a determination that he is
desirous of restructuring Vari-Lite's organization and eliminating the
position of Chief Operating Officer at this time;
THEREFORE, in consideration of the mutual covenants and conditions
contained in this Severance Agreement, the parties hereto agrees as follows:
1. EMPLOYMENT: Kinnu's employment at Vari-Lite Holdings, Inc. shall
be terminated as of close of the normal business day on September 30, 1996,
pursuant to Section 9(d) of the Employment Agreement. This termination is
being accomplished "Without Cause" and all the provisions of the Employment
Agreement which pertain to termination under that condition shall apply
except as they may be modified herein.
2. CONSULTANT SERVICES: Kinnu will provide consultant services to
Vari-Lite on a "call" basis for a period of twenty-four (24) months from the
date of termination at no cost to Vari-Lite except for costs as may be
related to travel or other incidental expense reimbursement. The meaning of
the term "call" in this context shall mean the establishment of a mutually
acceptable time and place for the services after Vari-Lite notifies Kinnu of
its need for his services.
3. EXHIBIT X-0, X-0 XXX X-0 XXXXXXXXXXXX: The parties agree that the
amount specified in the Exhibits dated September 10, 1996, and made a part of
the Employment Agreement for the value of the 10,000 shares being purchased
by Kinnu is not $132,900 but rather $138,900 and that this latter amount
shall be used as the "original principal amount" in calculating the change in
value, if any, at the time of Vari-Lite's re-purchase of the stock from Kinnu
upon termination.
4. RELOCATION ASSISTANCE LOAN PROMISSORY NOTE: Notwithstanding the
provisions of paragraph 5 of Exhibit C to the Employment Agreement, the
parties agree that rather than canceling the indebtedness as of the date of
the termination of Kinnu's employment and declaring the unpaid balance as of
that date ordinary income for Kinnu. Vari-Lite agrees to add an amount of
$2,777.78 to each semi-monthly payment to Kinnu of the base salary payments,
to reflect the continuing reduction of the principal until the total
principal amount is paid in full as of August 31, 1998.
5. BONUS PAYMENT: The parties agree that the bonus payment provided
for in paragraph 9(g) of the Employment Agreement shall be paid by Vari-Lite
to Kinnu on or about December 1, 1996.
6. RELEASE: Kinnu, on behalf of himself and his heirs, executors or
administrators, hereby releases, discharges and agrees not to xxx or file any
charges or claims against Vari-Lite, its directors, officers, agents,
employees, parent corporations, affiliated corporations, or predecessor
corporations, under any local, state, or federal law, for any type of claim,
demand or action whatsoever arising out of or connected with his employment
with Vari-Lite Holdings, Inc. Kinnu agrees not to make any claims or demands
against Vari-Lite, its directors, officers, agents, employees, parent
corporations, affiliated corporations, or predecessor corporations for
wrongful discharge; unlawful employment discrimination on the basis of age or
any other form of unlawful employment discrimination; retaliation; breach of
contract; breach of the duty of good faith and fair dealing; violation of the
public policy of the State of Texas; intentional or negligent infliction of
emotional distress; promissory estoppel; defamation of character; duress;
intentional misrepresentation or fraud; invasion of privacy; negligent
hiring, retention, or supervision; any alleged act of harassment or
intimidation; or any other intentional or negligent act of personal injury;
or any alleged violation of the Age Discrimination in Employment Act of 1990;
the Employee Retirement Income Security Act of 1974; the Fair Labor Standards
Act; the Texas Commission on Human Rights Act; and the Texas Payday Law.
7. NONDISCLOSURE: Kinnu agrees that he will not directly or
indirectly use or disclose to any person or business entity any financial
information involving Vari-Lite or proprietary information involving
Vari-Lite's products, vendors, marketing, sales, and operations. Kinnu
agrees that all financial information involving Vari-Lite and all information
involving Vari-Lite products, vendors, marketing, sales, and operations are
the exclusive property of Vari-Lite and that he shall not retain any records,
materials or other documents involving the above designated matters after
signing this Severance Agreement.
8. NONDISPARAGEMENT: The parties agree that neither Kinnu nor
Vari-Lite will engage in any conduct or take any action, written or oral,
that will reflect negatively on or damage the good reputation of the other
party. If one party believes that the other party has violated the terms of
this paragraph, the party shall give a written notice to the other party
describing the alleged violations and specifying what action is being
requested to resolve the alleged violation. The party receiving the written
notice shall respond in writing within thirty days and state a specific
response to each alleged violation set out in the written notice. If the
party who has sent the written notice is not satisfied with the response of
the other party, then the dispute will be resolved pursuant to arbitration
under paragraph 12 of the Employment Agreement.
9. SURVIVAL AND WAIVER: Should any provision of this Severance
Agreement be declared or be determined by any court to be illegal or invalid,
the validity of the remaining parts, terms or provisions shall not be
affected thereby and the illegal or invalid part, term or provisions shall
not be deemed to be a part of this Severance Agreement. The parties agree to
waive any notice provisions in the Employment Agreement that may be
applicable to the termination of Kinnu's employment.
10. COMPLETE AGREEMENT: This Severance Agreement and the Employment
Agreement with its Exhibits as modified by this Severance Agreement set forth
the entire agreement between the parties regarding the conclusion of Kinnu's
employment by Vari-Lite Holdings, Inc., and fully supersedes any and all
earlier agreements or understandings between the parties pertaining to the
subject matter of this Agreement.
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11. CONFIDENTIALITY: It is the express intent of the parties that the
terms and conditions of this Severance Agreement shall be kept confidential.
The parties agree that Kinnu may disclose the terms of this Severance Agreement
only to his wife, his attorney and his financial advisors. Vari-Lite may
disclose the terms of this Severance Agreement to its officers, its Board of
Directors, and to any employees that are necessary to effectuate the terms of
this Severance Agreement.
12. CERTIFICATION: By signing below, the parties certify and represent
that they have carefully read and considered this Severance Agreement and
fully understand the extent and impact of its provisions, and have executed
this Severance Agreement voluntarily and without coercion, undue influence,
threats, or intimidations of any kind or type whatsoever and that no other
promises have been made for the purpose of signing this Severance Agreement.
The terms and provisions set out in this Severance Agreement represent a full
and final resolution of Kinnu's employment relationship with Vari-Lite.
/s/ Xxx Xxxxx /s/ X. X. Xxxxxxxx III
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Xxx Xxxxx Vari-Lite, Inc.
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