EXHIBIT 10.50
February 19, 1999
Xx. Xxxxxx Xxxxxxxxx, Esq.
0000 Xxxxxx Xxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Re: TERMS OF SEPARATION FROM MBI
Dear Xx. Xxxxxxxxx:
In accordance with our recent discussions, this letter agreement
("Agreement") will set forth the terms of our agreement regarding your
departure from MBI.
1. SEPARATION DATE. Your separation shall be effective as of the end
of the day November 23, 1998 ("Separation Date").
2. EFFECTIVE DATE. This Agreement shall become effective on the
eighth day following your execution of this Agreement, unless you have
revoked acceptance during the seven days prior thereto ("Effective Date").
(See Paragraph 11(b) and (d).) Regardless of the exact day this takes place,
this Agreement shall be deemed to have been in effect retroactive to November
24, 1998.
3. SEPARATION PAYMENTS. MBI shall pay you the equivalent of nine
months' salary at your salary rate in effect as of the Separation Date. The
payments shall take place as follows:
(a) On the Effective Date, MBI shall pay you a lump sum equivalent to
five months' salary, minus the total salary payments you have
received from MBI since the Separation Date or the gross amount
of $30,673.10, less applicable witholdings.
(b) The remaining four months' salary shall be paid in accordance
with MBI's regular payroll periods, commencing with the next
payroll period following the effective date.
Taxes and other appropriate payroll deductions will be withheld, although
401(k) deductions shall no longer be made.
4. OTHER BENEFITS.
(a) MBI shall pay the COBRA premiums for eligible health, dental and
vision insurance coverage in effect as of the Separation Date for
you and covered dependents for nine months from the Separation
Date (i.e., through August 31, 1999). In the event you become
eligible for benefits under another plan(s)
Xxxxxx X. Xxxxxxxxx, Esq.
February 19, 1999
Page 2
prior to the expiration of this period, MBI shall no longer be
obligated to pay such benefit premiums. You are required to
notify MBI and are expected to enroll in the new group plan at
the first eligible opportunity unless you choose, at your sole
expense, to continue COBRA benefits through MBI. You notified us
by telephone message February 4, 1999 of your receipt of benefits
under the plan of your new employer. Therefore, this will confirm
that MBI will discontinue COBRA benefits effective March 1, 1999.
In no event shall a cash payment be made to eligible employees in
lieu of the payment of COBRA premiums.
Should you remain on COBRA for the entire nine-month period for
which you are eligible at MBI's expense, you may elect to
continue COBRA coverage, at your own expense, for up to an
additional nine months. If you wish to exercise this option,
please contact Human Resources.
(b) You were provided with the information needed to request the
option of converting the group life insurance and/or accidental
death and dismemberment insurance coverage to an individual
policy at your expense. You will work directly with MBI's
insurance company (CIGNA) should you elect this option. This
option must have been exercised within thirty-one days from the
last day of the month of Separation (November 30, 1998).
(c) You were provided with the information needed to request the
option of converting the Long-Term Disability (LTD) insurance
coverage to an individual policy. You will work directly with
MBI's insurance company (UNUM) should you elect this option.
This option must have been exercised within thirty-one days of
the Separation Date.
(d) If the balance in your 401(k) plan account is greater than
$3,500, you may elect either to remain in the plan with no
further deposits or to have the account balance distributed as
you direct in accordance with applicable regulations. If it is
less than $3,500, then the account balance will be distributed as
you direct in accordance with applicable regulations. If you
elect distribution of your account balance, you will work with
CIGNA to accomplish this. Information on how to initiate your
desired option will be provided by Human Resources.
(e) If you are a participant in MBI's Flexible Spending Accounts for
calendar year 1998, you will need to submit requests for
reimbursement for charges incurred through the Separation Date by
February 28, 1999. Any such request should be made directly to
UNUM.
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February 19, 1999
Page 3
(f) You have been paid for any earned and unused vacation time
through the Separation Date.
You may contact MBI Human Resources with any questions or for procedural
assistance on these items.
5. STOCK OPTIONS. You have been granted MBI stock options as
described in the attached schedule. As of the Effective Date, MBI will
accelerate the vesting of all unvested options. MBI will also extend the
period of exercisability of those options to the latest date available under
our plans (that is, the lapse dates in the charts, which are already at the
maximum, will not be reduced on account of your ceasing to be an employee.)
If you wish, you may use the services of MBI's Finance Department to assist
you in exercising your options and selling your shares. You acknowledge that
taxes and commissions will be withheld from any profit you make on the sale
of stock following exercise and sale.
6. CONTINUED REPORTING RESPONSIBILITIES. From the Separation Date
through May 24, 1999, you will be under the constraints imposed by MBI and
the U.S. securities laws on MBI vice presidents regarding the exercise of
options and the purchase and sale of MBI shares. During the Reporting
Period, you shall notify us of your intentions in this regard (including
options exercises) and shall execute such forms, if any, as MBI and the U.S.
securities laws require. During the Reporting Period, you will be notified
monthly, along with other MBI Section 16(b) reporting persons, as to the
current trading status of MBI stock (i.e., "green," "yellow," or "red
light"). At no time -- presently or at any future time, during or after the
Reporting Period, may you trade on MBI material inside information.
7. COOPERATION; NO RAIDING; NON-DISPARAGEMENT.
(a) You shall reasonably cooperate with MBI in any and all
governmental and/or third party proceedings including but not
limited to lawsuits and other disputes. MBI shall pay you a
reasonable consulting fee to be mutually agreed upon and pay your
other reasonable expenses in connection therewith (except that
MBI may not and shall not pay for the content of sworn
testimony). You shall keep MBI advised of contacts by
governmental agencies and third parties, and shall reasonably
cooperate with MBI in handling any response. At your request,
MBI shall provide counsel to you, if the parties deem counsel
necessary or desirable, in any such proceeding. You shall not
voluntarily cooperate with, testify for, or otherwise assist
parties adverse to MBI in a dispute with MBI, although you may
respond to compulsory process (i.e., a valid subpoena).
Xxxxxx X. Xxxxxxxxx, Esq.
February 19, 1999
Page 4
(b) For a period of one (1) year following the Separation Date, you
shall not contact persons employed by MBI to recruit them for
your business or any business by
which you are employed or with which you are affiliated, or
otherwise encourage them to leave MBI, without MBI's prior
consent.
(c) You shall not materially disparage MBI, and MBI shall not
materially disparage you, to any third parties.
8. CONTACTS BY POTENTIAL EMPLOYERS. Potential employers contacting
MBI will be told your title; your dates of employment; your final salary.
9. CONFIDENTIALITY. You will not remove any MBI information,
documents, or other property from MBI's premises. You will return any MBI
information or property currently in your possession or control off MBI's
premises. You represent that following the return of such property, if any,
you have no MBI property or information in your possession. In addition:
(a) You acknowledge that in the course of your employment with MBI
you have had access to and familiarity with information of
substantial value to MBI which is not old or generally known to
the public and which gives MBI an advantage over its competitors
who do not know or use it including but not limited to
strategies, business plans, research, formulas and techniques,
designs, drawings, processes, inventions, developments,
equipment, prototypes, sales and customer information and
financial information, relating to the business, products, and
practices of MBI ("Confidential Information"). You agree at all
times following the Separation Date to regard and preserve as
confidential such Confidential Information, and to refrain from
publishing or disclosing any part of such Confidential
Information and from using it except on behalf of MBI. You
further agree at all times to refrain from any other acts or
omissions that would reduce the value of such Confidential
Information to MBI and to take all reasonably necessary
precautions to prevent such Confidential Information from being
disseminated to any third parties.
Confidential information does not include information that (i)
becomes generally available to the public other than as a result
of a disclosure by you, (ii) was available to you on a
nonconfidential basis prior to its disclosure to you by MBI, or
(iii) becomes available to you on a nonconfidential basis from a
source other than MBI, provided that source is not known by you
(after due inquiry) to be bound by a confidentiality agreement
with MBI.
Xxxxxx X. Xxxxxxxxx, Esq.
February 19, 1999
Page 5
(b) You acknowledge that a breach of the terms of this paragraph
would threaten MBI
with immediate and irreparable harm not readily compensable in
money damages, and that MBI would be entitled to injunctive and
declaratory relief to stop or prevent any such breach.
Nothing in this paragraph shall be construed to prevent you from using or
disclosing your general knowledge of the imaging industry (as opposed to
MBI-specific information) acquired any time prior to or during the course of
your employment.
10. RELEASE.
(a) GENERAL RELEASE. In consideration for the payments, promises,
and other consideration described in this Agreement, each party
hereby unconditionally, irrevocably, and absolutely releases and
discharges the others (and in MBI's case, its employees,
officers, directors, agents, stockholders, independents
contractors, attorneys, consultants, predecessors, successors and
assigns) from any and all claims related in any way to any acts,
transactions, or occurrences between the parties to date,
including but not limited to all losses, liabilities, claims,
charges, demands, and causes of action, known or unknown,
suspected or unsuspected, arising directly or indirectly out of
or in any way connected with your employment with or separation
from MBI. This includes but is not limited to any claim of
employment discrimination arising under federal, state or local
law, including the Age Discrimination in Employment Act of 1967,
as amended, the Americans with Disabilities Act, the California
Fair Employment and Housing Act, any other statutory cause of
action, and any tort or contract claims.
The above release does not extend to any claims by either party for breach of
this Agreement.
(b) WAIVER OF ADDITIONAL CLAIMS. Section 1542 of the Civil Code of
the State of California provides:
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.
Regardless of whether this section is applicable to the present
release, each party waives and relinquishes any right or benefit
which it may have under this section or any other provision of
the statutory or nonstatutory law or any other jurisdiction to
the full extent that such party may lawfully waive all such
rights and benefits. In connection with such waiver and
relinquishment, each party
Xxxxxx X. Xxxxxxxxx, Esq.
February 19, 1999
Page 6
acknowledges that it is aware that it, its attorneys, or its
agents may hereafter discover claims or facts in addition to or
different from those which they now know or believe to exist, but
that it is their respective intention hereby fully, finally, and
forever to release all claims, disputes, and differences, known
or unknown, suspected or unsuspected, which now exist, or have
existed between the parties, their employees, agents, assigns and
other privies.
11. ACKNOWLEDGMENTS. You further acknowledge and agree as follows:
(a) You acknowledge that but for the entry by you and MBI into this
Agreement, you are not entitled to the three months of additional
salary payments and COBRA premiums and other consideration
provided for in these agreements (with the exception of federal
rights such as COBRA).
(b) You acknowledge that you have been given twenty-one days to
consider the terms of this Agreement. In addition, both parties
acknowledge that you may revoke your acceptance of this Agreement
within seven days following your signature (which may occur
during the twenty-one-day period), and that at your option you
may elect not to use the full twenty-one-day period.
(c) You acknowledge that you have been advised in writing to consult
with an attorney and an accountant or tax advisor before entering
into this agreement. You acknowledge either that you have done
so and received counseling to your satisfaction, or that you have
declined to do so and voluntarily executed this Agreement without
fraud or undue influence.
(d) This Agreement shall not become effective or enforceable until
seven days after you sign it. In other words, you may revoke
your acceptance of this Agreement within seven days after you
sign it. Your revocation must be in writing and received by MBI
within the seven day period in order to be effective. If you do
not revoke acceptance within the seven day period, your
acceptance of this Agreement shall become binding and
enforceable.
12. CONSEQUENCES OF BREACH. If you breach this Agreement, MBI may
terminate it, cease providing payments and benefits hereunder, and recover
all payments and benefits already paid, in addition to any other remedies it
may have. If MBI breaches this Agreement, you may terminate it and cease to
be bound by any of its provisions, in addition to any other remedies you may
have under applicable law.
Xxxxxx X. Xxxxxxxxx, Esq.
February 19, 1999
Page 7
13. OTHER MATTERS. You may receive materials prepared by Human
Resources describing various rights and duties, including optional benefits,
which will come into effect following your termination. You have been given
instruments customarily submitted to separated employees. You will
reasonably cooperate in these separation meetings and execute or complete
such instruments.
14. NO ASSIGNMENT. You shall not assign this Agreement or any of
the rights, interests and benefits hereunder. However, you may provide for
the assignment, gift, bequest, or transfer of such benefits under this
Agreement to your survivor(s), or to a trust for their benefit, on your death
or in the event you suffer a major disability.
15. ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties with respect to its subject matter. This
Agreement supersedes any and all other agreements, either oral or in writing,
between the parties hereto with respect to this subject matter.
16. BINDING EFFECT. This Agreement shall be binding upon and inure
to the benefit of both parties and their respective heirs, legal
representatives, executors, administrators, and successors.
17. GOVERNING LAW. This Agreement shall be subject to and governed
by the laws of the State of California.
18. AMENDMENT. No change or modification of this Agreement shall be
valid unless the same is in writing and signed by both parties. No waiver of
any provision of this Agreement shall be valid unless in writing and signed
by the person or party to be charged.
19. SEVERABILITY. If any portion or portions of this Agreement shall
be deemed invalid or unenforceable, the remaining portion or portions shall
nevertheless be valid, enforceable, and carried into effect, unless to do so
would clearly violate the present legal and valid intention of the parties.
20. HEADINGS. The headings of this Agreement are inserted for
convenience only and are not to be considered in construction of its
provisions.
21. NON-WAIVER. The waiver by either of the parties hereto of any
breach of any prevision hereof shall not be construed to be a waiver of any
succeeding breach of that provision or a waiver of any other provision of
this Agreement.
Xxxxxx X. Xxxxxxxxx, Esq.
February 19, 1999
Page 8
22. INDEMNIFICATION. With respect to any claim against you arising
out of your ordinary and reasonable performance of your duties on behalf of
MBI prior to the Separation Date, you shall have indemnification rights under
MBI's certificate of incorporation and bylaws equivalent to those of an MBI
officer.
23. ATTORNEYS' FEES. If either party commences or is made a party to
any litigation, arbitration, mediation or other judicial or administrative
proceeding to enforce, interpret or obtain a declaration of rights under this
Agreement for any claims arising prior to August 31, 1999, the prevailing
party in such proceeding shall be entitled to recover from the other party
all reasonable attorneys' fees, costs, and expenses incurred in connection
with such proceeding or any appeal or enforcement of any judgement entered in
any such proceeding. Any judgement or order entered in any proceeding shall
contain a specific provision providing for the recovery of reasonable
attorneys' fees and costs incurred in enforcing such judgement or order.
* * *
If you are in agreement with these terms, please execute the duplicate
originals of this Agreement and return them to Xxxxx Xxxxx in Human Resources.
Thank you.
Sincerely,
Xxxxx Xxxxxxxxxx
President and Chief Executive
Officer
AGREED:
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Xxxxxx Xxxxxxxxx
Date:
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