January 28, 2002
VIA HAND DELIVERY
Xxxxxx Xxxxxx
0000 Xxxxxxx Xxxxx Xxxxx
Xxx Xxxx, XX 00000
RE: General Release and Separation Agreement
Dear Xx. Xxxxxx:
Your last day of employment with GraphOn Corporation ("GraphOn") was
Thursday, January 10, 2002 (the "Separation Date"). The purpose of this General
Release and Separation Agreement ("General Release") is to resolve all
outstanding matters in any way related to your employment with GraphOn and/or
your separation from that employment, including, but not limited to, disputes
concerning any entitlements you may have under the Employment Agreement between
you and GraphOn dated February 7, 2001.
You agree that, as of the Separation Date, you have been paid the gross
amount of $21,323.07, which represents all of your accrued but unused vacation
and all wages earned through the Separation Date. You agree that upon the
execution of this General Release you are not entitled to receive any further
monetary payments from GraphOn arising out of or in any way related to your
employment with GraphOn other than as provided in this General Release.
In consideration for your execution of this General Release, you will
receive the gross amount of $337,500, less 27% Federal tax withholding, 6% State
tax withholding, and applicable withholdings for FICA, Medicare, and SDI, eight
(8) days after receipt by GraphOn of your signature to this General Release.
Additionally, in consideration for your execution of this General Release, if
you are eligible for and properly elect COBRA coverage for your health, dental,
and vision insurance, GraphOn will pay COBRA premiums arising out of your prior
health, dental, and vision coverage for a period not to exceed twelve (12)
months.
In exchange for the consideration provided by GraphOn in this General
Release, the adequacy of which you acknowledge, you, on behalf of yourself and
your heirs, successors, and assigns, hereby release GraphOn and each and every
past and present parent, subsidiary, associated, affiliated, predecessor, and
successor company, and the agents, officers, directors, attorneys,
administrators, assigns, employees, and owners of each, and each of them, from
any and all claims, demands, causes of action, obligations, attorneys' fees,
costs, damages, and liabilities of whatever kind or nature, in law or in equity,
known or unknown, suspected or unsuspected (all hereinafter referred to as
"claims"), which you ever had, now have, or may hereafter claim to have had,
arising on or before the date of your signature to this General Release, except
as specifically provided in the Finder's Fee Agreement between you and GraphOn
related to any full-time employment by GraphOn of Xxxxxxx Xxx as its CEO or as
one of its executive officers, including but not limited to:
o Any claim relating to any contract of employment, expressed or
implied, including, but not limited to, the Employment Agreement
between you and GraphOn dated February 7, 2001, which you agree is
hereby mutually cancelled;
o Any claim related to any other contract, oral or written, express or
implied;
o Any claim related to any covenant of good faith and fair dealing,
expressed or implied;
o Any claim under a tort theory of any nature, including, but not limited
to, common law claims of wrongful discharge;
o Any claim under any federal, state or municipal statute or ordinance;
o Any claim of discrimination under Title VII of the Civil Rights Act
of 1964, as amended; the California Fair Employment and Housing Act;
the Americans with Disabilities Act; the Family and Medical Leave
Act; the Age Discrimination in Employment Act; the Older Workers'
Benefit Protection Act; and any other federal, state or local laws,
including, but not limited to, the California Labor and/or
Government Codes;
o Any claim under any other law or regulation relating to employment
discrimination.
In signing this General Release, you acknowledge that Section 1542 of the
Civil Code of the State of California 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."
You understand that Section 1542 gives you the right not to release
existing claims of which you may be currently unaware, unless you voluntarily
choose to waive this right. Having been apprised of this, you nevertheless
voluntarily elect to waive the rights outlined in Section 1542, as well as under
any statutes or common law principles of any other jurisdiction of similar
effect, and assume all risks for claims, which may now exist in your favor,
known or unknown, in any way related to this General Release.
You agree that execution of this General Release operates as a complete
bar and defense against any and all past, current or future claims that may be
made by you against the persons and entities herein released arising on or
before the date of your signature to this General Release, including, but not
limited to, claims arising out of or in any way related to your employment with
GraphOn and/or your separation from that employment. You agree that, if you
hereafter commence any action or proceeding against any person or entity
released herein based upon any of the claims released by this General Release,
the provisions of this General Release shall be deemed breached, and the person
or entity against whom the action or proceeding was commenced shall be entitled
to recover any attorneys' fees and other costs of suit sustained in defending
such action or proceeding and shall be indemnified for such fees and costs.
Notwithstanding the provisions of this General Release, that certain
Indemnification Agreement between you and GraphOn dated June 16, 1999, shall
remain in full force and effect.
You and GraphOn mutually agree to keep the terms and conditions of this
General Release completely and strictly confidential. You and GraphOn mutually
agree not to disclose the terms or conditions of this General Release to any
person or entity. These confidentiality provisions are material provisions of
this General Release.
The only exceptions to the above paragraph regarding the confidentiality
of this General Release are as follows:
(1) as required by the applicable federal securities law, and/or the rules
and regulations of the Securities and Exchange Commission promulgated
thereunder; or
(2) as required by any other law, or upon order of any court of competent
jurisdiction, in any action in which you or GraphOn are a party, or are
subpoenaed as a witness, to agencies, individuals, or entities to whom the
subpoena requires disclosure, including, but not limited to, state or federal
employment or taxing entities, provided that in the event of any such required
disclosure, you will advise GraphOn in advance of any such disclosure and
GraphOn will advise you in advance of any such disclosure; or
(3) to your tax or financial advisors, attorneys, and spouse on the
further condition that you or GraphOn advise such individuals in advance of
disclosure that the terms and conditions of the General Release are strictly
confidential and each recipient expressly agrees to be bound hereby; or
(4) to remedy a breach of any term or condition herein.
You agree that you and GraphOn are parties to a Proprietary Information
and Inventions Agreement which prohibits you from using or disclosing the
confidential information of GraphOn or any of its clients, both during and after
your employment with GraphOn. In that regard, during the course of your
employment as an employee of GraphOn, you have received confidential information
concerning GraphOn's business. You acknowledge that the disclosure of
confidential proprietary information concerning GraphOn's business to third
parties, including competitors, would violate the Proprietary Information and
Inventions Agreement and would cause GraphOn great damage. Accordingly, you
agree that the Proprietary Information and Inventions Agreement shall remain in
full force and effect, and shall not be in any way superceded or amended by this
General Release. You agree to preserve the confidentiality of the information
you have received and not to use it or disclose it to any third party. GraphOn
shall have the right to seek injunctive relief against any such use or
disclosure or threatened use or disclosure, and GraphOn reserves the right to
notify third parties of its claims in order to fully protect its confidential
and proprietary information. Notwithstanding the foregoing, for a period of
three (3) months from the date hereof, GraphOn agrees that you, at GraphOn's
direction, may continue to communicate with GraphOn employees, consultants, and
contractors concerning Proprietary Information and Inventions.
You agree not to communicate negative or disparaging comments about
GraphOn, and GraphOn shall cause its executive officers and directors to agree
not to communicate negative or disparaging comments about you.
You agree to resign from GraphOn's Board of Directors and to return all
equipment in your possession owned by GraphOn.
GraphOn has ceased using your personal credit cards as of January 10,
2002. Any and all credit card charges or expenses of any kind incurred by
GraphOn will be paid directly to the credit card company within eight (8) days
of receipt of such expense. GraphOn shall reimburse you within eight (8) days of
receipt of any outstanding reasonable business expenses incurred by you on
behalf of GraphOn during your employment, provided that (i) such reasonable
expenses are ordinary and necessary business expenses incurred on behalf of
GraphOn, and (ii) you provide GraphOn with itemized accounts, receipts and other
documentation for such reasonable expenses. The deadline for you to submit
requests for the payments described above is March 31, 2002.
You warrant and represent that you have not transferred or assigned, or
purported to transfer or assign, any of the claims and rights released or
affected in this General Release.
You and GraphOn agree that any future disputes between you and GraphOn,
including, but not limited to, disputes arising out of or related to this
General Release shall be resolved by binding arbitration pursuant to the
National Rules for Resolution of Employment Disputes of the American Arbitration
Association. You further agree that this General Release shall be governed by,
and construed and enforced in accordance with, the laws of the State of
California in any such arbitration. The parties shall each bear one-half of the
direct costs of the arbitrator, and each party shall bear its own costs and
attorneys' fees as permitted by law.
This General Release constitutes the entire agreement and understanding
between you and GraphOn with respect to its terms and supersedes any prior oral
or written communications or employment policies of GraphOn. If any provision of
this General Release is subsequently determined to be unenforceable by a court,
that provision shall be deemed severable from the rest of this General Release,
and the remainder shall be enforced to the maximum legal extent. This General
Release shall be interpreted and enforced under the laws of the State of
California.
You understand and agree that the payment of consideration to which
reference is made in the General Release does not constitute an admission or
concession of any claim on your part or of any liability by GraphOn, which
liability GraphOn expressly denies.
You confirm that you have read this General Release, fully understand its
terms and their effect, and sign this General Release voluntarily and with the
intention of being legally bound by it. You understand that you are waiving
legal rights by signing this General Release and have consulted your attorney
before signing this General Release. You agree that this General Release was the
product of negotiation such that it shall not be construed against the drafter.
Revocation Right. You understand that you have up to twenty-one (21) days
from the date of this General Release to accept the terms of this General
Release, although you are free to accept it at any time within that twenty-one
(21) day period. You further understand and acknowledge that you have seven (7)
days from the date of executing this General Release within which to revoke it.
To revoke this General Release, you must send written notice to GraphOn
Corporation, ATTN: Xxxxxxx Xxxxx, 000 Xxxxxxxx Xxxxxx, Xxxxxx Xxxx, Xxxxxxxxxx
00000. GraphOn must receive any such notice by the seventh day from execution of
this General Release. Once the seven-day revocation period has run, you will
receive the payments as described herein.
Sincerely,
/S/ Xxxxxxx Xxxxx
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Xxxxxxx Xxxxx
GraphOn Corporation
ACCEPTED AND AGREED:
I accept, understand and agree to the terms outlined above.
Date: January 28, 2002 /s/ Xxxxxx Xxxxxx
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Xxxxxx Xxxxxx
APPROVED AS TO SUBSTANCE AND FORM:
XXXXXXX XXXXXXX & XXXXXXXX
Date: January 28, 2002 /s/ XXXXXXX PHLEGER & XXXXXXXX
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Attorneys for Xxxxxx Xxxxxx
