EXHIBIT 10.77
AGREEMENT AND COMPLETE RELEASE
WHEREAS Xxxx Xxxxxxx (hereinafter "Xxxxxxx") and xxxxxx.xxx, Incorporated
(hereinafter "xxxxxx.xxx") wish to end the employment relationship between them
and to fully and finally resolve all differences between them, the following
constitutes their AGREEMENT:
In exchange for the mutual covenants herein expressed, the parties agree as
follows:
1. Xxxxxxx shall resign from his employment effective on July 7, 2000 (the
"Termination Effective Date"). The Employment Agreement of May 24, 1999,
between Xxxxxxx and xxxxxx.xxx shall terminate as of July 5, 2000. (A copy
of the Employment Agreement is attached hereto as Exhibit A.) Xxxxxxx'x
resignation shall be deemed a termination without cause for purposes of all
stock option exercise periods. Notwithstanding the termination of the
Employment Agreement, Xxxxxxx shall remain bound by his promises regarding
nondisclosure and return of confidential information, assignment of
intellectual property, non-competition, and non-solicitation as set forth in
Article V of the Employment Agreement.
2. In consideration for this Agreement, and following the expiration of the
revocation period described below without Xxxxxxx having exercised his
revocation right, xxxxxx.xxx will: (a) pursuant to the xxxxxx.xxx, Inc.
Severance Plan For Select Employees and as a vested, accrued and irrevocable
benefit thereunder provided that Xxxxxxx does not breach this Agreement, pay
Xxxxxxx the gross sum of $140,000.00, less all applicable withholdings, in
twelve monthly installments beginning on the first regularly scheduled pay
day following the expiration of the revocation period described below; (b)
allow Xxxxxxx to keep his laptop computer and cell phone; and (c) have
amended all Xxxxxxx'x outstanding stock option agreements such that the
shares subject to the options are fully vested and the options are
immediately exercisable following the expiration of the revocation period
described below (such amendments are attached as Exhibits B, C, D, and E
hereto).
3. In consideration for this Agreement, Xxxxxxx will: (a) provide his services
as an independent contractor-consultant as provided in Exhibit F; and (b)
abide by his promises herein.
4. Xxxxxxx understands, agrees, and expressly represents that the consideration
recited in the foregoing Paragraph 2 is separate from and additional to any
payments or benefits to which he was already entitled by virtue of his
services to xxxxxx.xxx and to which he has no legal right. Xxxxxxx
understands, agrees, and expressly represents that, apart from the
consulting arrangement described above in Paragraph 3 and Exhibit F, he will
be entitled to no further compensation or payments of any type from
xxxxxx.xxx.
5. Apart from the consulting arrangement described above in Xxxxxxxxx 0,
Xxxxxxx WAIVES AND DISCLAIMS any claim or right he may have to be engaged or
employed by xxxxxx.xxx or any of its affiliate companies at any time in the
future and promises not to seek or demand future engagement or employment
with xxxxxx.xxx or any of its affiliate companies, it being agreed, however,
that this provision shall not preclude xxxxxx.xxx from requesting on its
initiative and in its sole discretion that Xxxxxxx be employed by it, or
subsequently employing Xxxxxxx, in the future.
6. Xxxxxxx represents and affirms that within two (2) business days of the
Termination Effective Date he will return any and all xxxxxx.xxx property he
may have had, including but not limited to confidential information as
defined in the Employment Agreement but excluding the cell phone and laptop
computer conveyed to Xxxxxxx as provided in Paragraph 2.
7. Xxxxxxx agrees to keep both the existence and the terms of this Agreement
confidential, and not to disclose any information regarding this Agreement
to anyone other than his attorney, tax advisor and spouse (if any) who shall
be informed of and bound by this confidentiality provision.
8. Xxxxxxx does, for himself and his heirs, agents, executors, administrators,
and assigns hereby RELEASE and FOREVER DISCHARGE xxxxxx.xxx and its
directors, officers, employees, agents, attorneys, successors, predecessors,
assigns, and affiliated companies (collectively "Releasees") from any and
all claims, actions, and causes of action of whatever kind or nature, which
he may now have or ever may have had against the Releasees or any of them,
whether known or unknown to him, such as may have arisen in whole or in part
at any time prior to or on the date of execution of this Agreement. This
includes, but is not limited to, any claims arising out of any contract,
express or implied, any covenant of good faith and fair dealing, express or
implied, any tort (whether intentional or negligent, including claims
arising out of the NEGLIGENCE OR GROSS NEGLIGENCE of any person released in
this Agreement), and any federal, state, or other governmental statute,
regulation, or ordinance relating to employment discrimination, termination
of employment, or payment of wages or provision of benefits, including
without limitation Title VII of the Civil Rights Act of 1964 as amended, the
Civil Rights Act of 1991, the Age Discrimination in Employment Act as
amended, the Americans with Disabilities Act, the Employee Retirement Income
Security Act, the Family and Medical Leave Act, the Fair Labor Standards
Act, the Texas Commission on Human Rights Act, the Texas Payday Law, and the
Texas Workers' Compensation Act. Xxxxxxx and xxxxxx.xxx agree that by this
Agreement, Xxxxxxx is not releasing any claims he may have under the Age
Discrimination in Employment Act that may arise after this Agreement becomes
effective (i.e., after the revocation period described in Paragraph 9
elapses without Xxxxxxx having exercised his revocation right).
9. Xxxxxxx has a maximum of twenty-one (21) days from July 7, 2000, in which to
review and consider this Agreement before signing it, and may use as much or
as little of that period as he wishes. After Xxxxxxx signs this Agreement,
Xxxxxxx has seven (7) days in which to revoke the Agreement. Any such
revocation will not be effective unless Xxxxxxx delivers a written notice of
such revocation to xxxxxx.xxx c/o Xxxxxx Xxxxxxx, President and CEO, 0000
Xxxxx Xxxxx, Xxxxx 000, Xxxxxx, Xxxxx 00000, no later than the close of
business on the seventh day after Xxxxxxx signs this Agreement.
10. xxxxxx.xxx does for itself and its directors, officers, employees, agents,
attorneys, successors, predecessors, assigns, and affiliated companies, does
hereby RELEASE and FOREVER DISCHARGE Xxxxxxx from any and all claims,
actions, and causes of action of whatever kind or nature, which they, or any
of them, may now have or ever may have had against Xxxxxxx whether known or
unknown to them, such as may have arisen in whole or part at any time prior
to or on the date of execution of this Agreement. This Release includes, but
is not limited to, any claims arising out of any contract, express or
implied, any covenant of good faith and fair dealing, express or implied,
any tort (whether intentional or negligent, including claims arising out of
the NEGLIGENCE OR GROSS NEGLIGENCE of any person released in this
Agreement), and any federal, state, or other governmental statute,
regulation, or ordinance of any kind whatsoever.
11. The parties hereto expressly PROMISE NOT TO XXX OR INSTITUTE OTHER LEGAL
PROCEEDINGS on the basis of any claims, actions, or causes of action that
are being released by this Agreement. Each party understands and agrees that
if he or it breaches this promise and files a lawsuit or institutes other
legal proceedings with any court or governmental agency, he or it will pay
for all costs incurred by the released party or parties, or any of them,
including attorneys' fees.
12. Each party hereto understands and agrees that by entering into this
Agreement, neither Xxxxxxx nor xxxxxx.xxx is admitting any liability or
wrongdoing. Rather, each party understands and agrees that this Agreement is
merely to settle any differences between them arising out of Xxxxxxx'x
relationship with xxxxxx.xxx and the termination of that relationship.
13. Xxxxxxx agrees that he will not, directly or indirectly, in any individual
or representative capacity whatsoever, make any statement, oral or written,
or perform any act or omission which is or could be detrimental in any
material respect to the reputation or goodwill of xxxxxx.xxx or any other
person or entity released herein except as may be required by law, court
order, government agency request or subpoena, or to defend himself in
connection with a legal proceeding. Xxxxxxx further agrees he will not
voluntarily participate in, or aid or encourage any other party in
connection with, any lawsuit or proceeding of any kind brought or asserted
by any person or entity against xxxxxx.xxx or any other person or entity
released herein.
14. xxxxxx.xxx agrees that it will not make any statement, oral or written, or
perform any act or omission which is or could be detrimental in any
material respect to the reputation or goodwill of Xxxxxxx, except as may be
required by law, court order, government agency request or subpoena, or to
defend itself in connection with a legal proceeding. xxxxxx.xxx's
obligations under this paragraph shall be limited to statements made by any
officer who was an officer of xxxxxx.xxx at the time the statement was
made. In response to inquiries from prospective employers, xxxxxx.xxx will
provide a neutral letter of reference.
15. xxxxxx.xxx and Xxxxxxx agree that press releases regarding Xxxxxxx'x
resignation will be mutually acceptable.
16. Xxxxxxx hereby agrees that he is solely responsible for all federal, state,
and local tax obligations, if any, including, but not limited to, all
reporting and payment obligations that may arise as a consequence of this
Agreement. Xxxxxxx acknowledges that xxxxxx.xxx and the other persons or
entities released herein make no representations regarding the tax
treatment or consequences of such benefit(s). Xxxxxxx agrees to indemnify
and hold xxxxxx.xxx and the other persons or entities released herein, or
any of them, harmless from and against any and all loss, cost, damage, or
expense, including, without limitation, attorneys' fees, penalties or
interest, incurred by xxxxxx.xxx and the other persons or entities released
herein, or any of them, arising out of the tax treatment of the benefit(s)
received by Xxxxxxx as a result of his employment with xxxxxx.xxx, his
stock options, his services as a consultant, or this Agreement.
17. Xxxxxxx and xxxxxx.xxx agree that any dispute or claim relating to, arising
from, or connected in any manner with this Agreement--except for claims
concerning Xxxxxxx'x promises regarding nondisclosure and return of
confidential information, assignment of intellectual property, non-
competition, and non-solicitation as set forth in Article V of the
Employment Agreement--exclusively shall be resolved through final and
binding arbitration. Claims concerning Xxxxxxx'x promises regarding
nondisclosure and return of confidential information, assignment of
intellectual property, non-competition, and non-solicitation as set forth
in Article V of the Employment Agreement may be submitted to arbitration
upon mutual consent of the parties. The arbitration shall proceed in accord
with the National Rules for the Resolution of Employment Disputes of the
American Arbitration Association ("AAA") in effect at the time the claim or
dispute arose, unless other rules are agreed upon by the parties. The
arbitration shall be conducted in Austin, Texas, by one arbitrator who is a
member of the AAA, unless the parties mutually agree otherwise. The
arbitrator shall have jurisdiction to determine any claim, including the
arbitrability of any claim, submitted to his or him. The arbitrator may
grant any relief authorized by law for any properly established claim.
Prior to the hearing, the AAA exclusively shall have the authority to
determine and allocate filing and administrative fees and arbitrator's
hearing and study fees between the parties. The arbitrator may reallocate
the pre-hearing fees, costs, and expenses incurred by the parties in any
final arbitration award in accordance with Paragraph 11. The interpretation
and enforceability of this Paragraph of this Agreement exclusively shall be
governed and construed in accord with the United States Federal Arbitration
Act, 9 U.S.C. (S)1, et. seq.
18. This Agreement constitutes the entire agreement between the parties with
respect to the subject matter hereof and supersedes all other agreements
between the parties with respect to the subject matter hereof. No waiver,
amendment, or modification of this Agreement shall be valid unless in
writing and signed by each of the parties.
19. The provisions of this Agreement are severable. If any provision is held to
be invalid or unenforceable, it shall not affect the validity or the
enforceability of any other provision.
20. This Agreement shall be interpreted and enforced under the laws of the
state of Texas.
[SIGNATURE PAGE FOLLOWS]
XXXXXXX UNDERSTANDS THAT HE HAS THE RIGHT TO DISCUSS ALL ASPECTS OF THIS
AGREEMENT AND COMPLETE RELEASE ("AGREEMENT") WITH AN ATTORNEY OF HIS CHOICE. BY
HIS SIGNATURE BELOW, XXXXXXX AGREES THAT HE HAS EXERCISED THIS RIGHT TO THE
EXTENT HE DESIRED, THAT HE HAD A SUFFICIENT PERIOD OF TIME TO REVIEW THIS
AGREEMENT, THAT HE FULLY UNDERSTANDS THIS AGREEMENT, AND THAT THIS AGREEMENT IS
MADE KNOWINGLY AND VOLUNTARILY.
IN WITNESS THEREOF, the parties have affixed their signatures in the spaces
provided on this 7th day of July, 2000.
xxxxxx.xxx, Inc. Xxxx Xxxxxxx, An Individual
BY: /s/ Xxxxxx X. Xxxxxxx /s/ Xxxx Xxxxxxx
------------------------ --------------------------
Xxxxxx X. Xxxxxxx
President and Chief Executive Officer
STATE OF TEXAS )
) ss.
COUNTY OF XXXXXX )
BEFORE ME, the undersigned notary public, on this day personally appeared
XXXX XXXXXXX, known to me to be the person who executed the foregoing
instrument, and acknowledged to me that he executed the same for the purposes
and consideration therein expressed.
GIVEN under my hand and seal of office, this 7th day of July, 2000.
/s/ Xxxxxx Xxxxxxxx
-----------------------------
Notary Public in and for the State of Texas
EXHIBIT B
AMENDMENT TO JUNE 4, 1999
XXXXXX.XXX, INC. INCENTIVE STOCK OPTION AGREEMENT
FOR XXXX XXXXXXX
THIS AMENDMENT ("Amendment") is entered into by and between Xxxx
Xxxxxxx ("Employee") and the Compensation Committee (the "Committee"), effective
as of July 7, 2000, the date prior to the date Employee's employment with
xxxxxx.xxx, Inc. (the "Company") is terminated (the "Effective Date").
WHEREAS, Employee and the Company are parties to the xxxxxx.xxx, Inc.
Incentive Stock Option Agreement with a date of grant of June 4, 1999 (the
"Agreement"), granted pursuant to the 1999 Equity Participation Plan of
xxxxxx.xxx, Inc. (the "Plan"); and
WHEREAS, the Committee has been appointed pursuant to Section 10.1 of
the Plan; and
WHEREAS, pursuant to Section 5.3(a) of the Plan, the Committee may
accelerate the period during which an option vests; and
WHEREAS, the Committee and Employee now desire to amend the Agreement;
NOW, THEREFORE, for and in consideration of the premises and the
mutual benefits to the parties arising out of this Amendment, the receipt and
sufficiency of which are hereby acknowledged by the parties, the Committee and
Employee agree that the Agreement shall be amended as follows:
1. As of the Effective Date, Section 3 of the Agreement shall be amended by
adding the following provision:
Notwithstanding the foregoing, in the event that Optionee resigns from
employment with the Company, all shares subject to this Option shall vest
immediately and such Option shall be fully exercisable as of the expiration
of the revocation right contained in the agreement between Optionee and the
Company that governs such resignation.
2. As amended hereby, the Agreement is ratified and reaffirmed.
3. Notwithstanding any provision in this Amendment to the contrary, in the
event that Optionee exercises the revocation right contained in the
agreement between Optionee and the Company that governs Optionee's
resignation, this Amendment shall be null, void, and of no effect.
EXECUTED this 7 day of July, 2000.
SECRETARY FOR BOARD OF DIRECTORS MEETING
/s/ Xxxxxx Xxxxxxx
----------------------------
XXXX XXXXXXX
/s/ Xxxx Xxxxxxx
----------------------------
EXHIBIT C
AMENDMENT TO APRIL 28, 2000
XXXXXX.XXX, INC. INCENTIVE STOCK OPTION AGREEMENT
FOR 50,000 SHARES TO XXXX XXXXXXX
THIS AMENDMENT ("Amendment") is entered into by and between Xxxx
Xxxxxxx ("Employee") and the Compensation Committee (the "Committee"), effective
as of July 7, 2000, the date prior to the date Employee's employment with
xxxxxx.xxx, Inc. (the "Company") is terminated (the "Effective Date").
WHEREAS, Employee and the Company are parties to the xxxxxx.xxx, Inc.
Incentive Stock Option Agreement for 50,000 shares, with a date of grant of
April 28, 2000, (the "Agreement") granted pursuant to the 1999 Equity
Participation Plan of xxxxxx.xxx, Inc. (the "Plan"); and
WHEREAS, the Committee has been appointed pursuant to Section 10.1 of
the Plan; and
WHEREAS, pursuant to Section 5.3(a) of the Plan, the Committee may
accelerate the period during which an option vests; and
WHEREAS, the Committee and Employee now desire to amend the Agreement;
NOW, THEREFORE, for and in consideration of the premises and the
mutual benefits to the parties arising out of this Amendment, the receipt and
sufficiency of which are hereby acknowledged by the parties, the Company and
Employee agree that the Agreement shall be amended as follows:
1. As of the Effective Date, Section 3 of the Agreement shall be amended by
adding the following provision:
Notwithstanding the foregoing, in the event that Optionee resigns from
employment with the Company, all shares subject to this Option shall vest
immediately and such Option shall be fully exercisable as of the expiration
of the revocation right contained in the agreement between Optionee and the
Company that governs such resignation.
2. As amended hereby, the Agreement is ratified and reaffirmed.
3. Notwithstanding any provision in this Amendment to the contrary, in the
event that Optionee exercises the revocation right contained in the
agreement between Optionee and the Company that governs Optionee's
resignation, this Amendment shall be null, void, and of no effect.
EXECUTED this 7 day of July, 2000.
SECRETARY FOR BOARD OF DIRECTORS MEETING
/s/ Xxxxxx Xxxxxxx
------------------
XXXX XXXXXXX
/s/ Xxxx Xxxxxxx
----------------
EXHIBIT D
AMENDMENT TO APRIL 28, 2000
XXXXXX.XXX, INC. INCENTIVE STOCK OPTION AGREEMENT
FOR 24,000 SHARES TO XXXX XXXXXXX
THIS AMENDMENT ("Amendment") is entered into by and between Xxxx
Xxxxxxx ("Employee") and the Compensation Committee (the "Committee"), effective
as of July 7, 2000, the date prior to the date Employee's employment with
xxxxxx.xxx, Inc. (the "Company") is terminated (the "Effective Date").
WHEREAS, Employee and the Company are parties to the xxxxxx.xxx, Inc.
Incentive Stock Option Agreement for 24,000 shares, with a date of grant of
April 28, 2000, (the "Agreement") granted pursuant to the 1999 Equity
Participation Plan of xxxxxx.xxx, Inc. (the "Plan"); and
WHEREAS, the Committee has been appointed pursuant to Section 10.1 of
the Plan; and
WHEREAS, pursuant to Section 5.3(a) of the Plan, the Committee may
accelerate the period during which an option vests; and
WHEREAS, the Committee and Employee now desire to amend the Agreement;
NOW, THEREFORE, for and in consideration of the premises and the
mutual benefits to the parties arising out of this Amendment, the receipt and
sufficiency of which are hereby acknowledged by the parties, the Company and
Employee agree that the Agreement shall be amended as follows:
1. As of the Effective Date, Section 3 of the Agreement shall be amended by
adding the following provision:
Notwithstanding the foregoing, in the event that Optionee resigns from
employment with the Company, all shares subject to this Option shall vest
immediately and such Option shall be fully exercisable as of the expiration
of the revocation right contained in the agreement between Optionee and the
Company that governs such resignation.
2. As amended hereby, the Agreement is ratified and reaffirmed.
3. Notwithstanding any provision in this Amendment to the contrary, in the
event that Optionee exercises the revocation right contained in the
agreement between Optionee and the Company that governs Optionee's
resignation, this Amendment shall be null, void, and of no effect.
EXECUTED this 7 day of July, 2000.
SECRETARY FOR BOARD OF DIRECTORS MEETING
/s/ Xxxxxx Xxxxxxx
------------------
XXXX XXXXXXX
/s/ Xxxx Xxxxxxx
----------------
EXHIBIT E
AMENDMENT TO JUNE 5, 2000
XXXXXX.XXX, INC. INCENTIVE STOCK OPTION AGREEMENT
TO XXXX XXXXXXX
THIS AMENDMENT ("Amendment") is entered into by and between Xxxx
Xxxxxxx ("Employee") and the Compensation Committee (the "Committee"), effective
as of July 7, 2000, the date prior to the date Employee's employment with
xxxxxx.xxx, Inc. (the "Company") is terminated (the "Effective Date").
WHEREAS, Employee and the Company are parties to the xxxxxx.xxx, Inc.
Incentive Stock Option Agreement with a date of grant of June 5, 2000 (the
"Agreement"), granted pursuant to the 1999 Equity Participation Plan of
xxxxxx.xxx, Inc. (the "Plan"); and
WHEREAS, the Committee has been appointed pursuant to Section 10.1 of
the Plan; and
WHEREAS, pursuant to Section 5.3(a) of the Plan, the Committee may
accelerate the period during which an option vests; and
WHEREAS, the Committee and Employee now desire to amend the Agreement;
NOW, THEREFORE, for and in consideration of the premises and the
mutual benefits to the parties arising out of this Amendment, the receipt and
sufficiency of which are hereby acknowledged by the parties, the Company and
Employee agree that the Agreement shall be amended as follows:
1. As of the Effective Date, the Agreement shall be amended by adding the
following provision:
Notwithstanding anything to the contrary herein, in the event that Optionee
resigns from employment with the Company, all shares subject to this Option
shall vest immediately and such Option shall be fully exercisable as of the
expiration of the revocation right contained in the agreement between
Optionee and the Company that governs such resignation.
2. As amended hereby, the Agreement is ratified and reaffirmed.
3. Notwithstanding any provision in this Amendment to the contrary, in the
event that Optionee exercises the revocation right contained in the
agreement between Optionee and the Company that governs Optionee's
resignation, this Amendment shall be null, void, and of no effect.
EXECUTED this 7 day of July, 2000.
SECRETARY FOR BOARD OF DIRECTORS MEETING
/s/ Xxxxxx Xxxxxxx
------------------
XXXX XXXXXXX
/s/ Xxxx Xxxxxxx
----------------
EXHIBIT F
Consulting Agreement
xxxxxx.xxx agrees to retain Xxxxxxx, and Xxxxxxx agrees to serve, as
an independent contractor-consultant in the capacity of Acting Vice President of
Marketing for a minimum period of 30 days following the Termination Effective
Date (the "Consulting Period"). Xxxxxxx shall be compensated at the rate of
$2,916.67 per week during the Consulting Period. Upon mutual written agreement,
Xxxxxxx'x service as an independent-contractor consultant may continue beyond
the Consulting Period defined above.
Xxxxxxx'x duties shall be to advise xxxxxx.xxx's President and Chief
Executive Officer and to carry out the instructions given and tasks delegated by
the President and Chief Executive Officer to him. Xxxxxxx shall have no
independent authority to bind or act on behalf of the company. Xxxxxxx
understands and agrees that he shall in no sense be considered an employee of
xxxxxx.xxx or any related entity while engaging in the activities provided for
under this Consulting Agreement. In keeping with this independent contractor
status, Xxxxxxx is free to control his methods of work, provided that Xxxxxxx
continues to render his best efforts for xxxxxx.xxx under this Agreement.
As a consequence of Xxxxxxx'x independent contractor status, Xxxxxxx
is not, under this Consulting Agreement, entitled to, or eligible to participate
in, any benefits, privileges, incentives or bonus programs given or extended by
xxxxxx.xxx to its employees. Among other things, Xxxxxxx shall have no claim
against xxxxxx.xxx hereunder for vacation pay, sick leave, retirement benefits,
social security, unemployment insurance benefits, or employee benefits of any
kind.
During the term of this Consulting Agreement, Xxxxxxx shall be bound
by his promises regarding nondisclosure and return of confidential information,
assignment of intellectual property, non-competition, and non-solicitation as
set forth in Article V of the Employment Agreement as if he were still an
employee of xxxxxx.xxx.
xxxxxx.xxx may terminate this Consulting Agreement at any time and for
any reason in its sole discretion; provided, however, that if it terminates the
Consulting Agreement within the Consulting Period, it will pay Xxxxxxx $2,916.67
for each full week remaining in the Consulting Period and payment for any
partial week shall be prorated. xxxxxx.xxx's termination of this Consulting
Agreement for any reason at the end of or, in the event Xxxxxxx'x service
extends beyond the Consulting Period, following the Consulting Period shall not
result in any further payment to Xxxxxxx.
The Indemnification Agreement of May 24, 1999, by and between
xxxxxx.xxx and Xxxxxxx shall continue in full force and effect during the term
of this Consulting Agreement for Xxxxxxx'x actions within the scope of his
authority hereunder.
