SEPARATION AND GENERAL RELEASE AGREEMENT
Exhibit 10.2
This Separation and General Release Agreement (the “Agreement”) is being entered into by and
between Xxxxx.xxx Corporation (“Employer” or the “Company”) and Xxxxxx Xxxxx (“Employee”)
(collectively the “Parties”) as of the date of Employee’s execution of this Agreement (the “Date
of this Agreement”).
WHEREAS, the Parties previously entered into that certain Amended and Restated Employment
Agreement (the “Employment Agreement”) dated April 26, 2010;
WHEREAS, Employer is now providing notice to Employee that Employer is terminating the
employment of Employee without Cause pursuant to Section 5.2(b) of the Employment Agreement; and
WHEREAS, Employee is entitled to receive a portion of her salary and other benefits pursuant
to Section 5.2(c) of the Employment Agreement, provided Employee signs this Agreement;
NOW, THEREFORE, in consideration of the foregoing premises and the terms and conditions set
forth below, the Parties agree as follows:
1. Acknowledgment. Employee hereby acknowledges receipt of this Agreement on October
18, 2010 (the “Acknowledgment Date”). Employee hereby acknowledges that Employer is terminating
the employment of Employee without Cause pursuant to Section 5.2(b) of the Employment Agreement
effective as of the Acknowledgement Date. Employee understands that should she agree to this
release, she would give up any right or claim to compensation or benefits of employment with the
Company beyond the Acknowledgement Date, except as set forth in this Agreement, including without
limitation Section 12 hereof. On the Acknowledgment Date, Employee will be paid all unpaid, earned
wages, including without limitation, any accrued, unused vacation pay, as well as any unpaid,
reimbursable expenses.
2. Compensation to Employee for General Release. Provided that Employee delivers a
signed copy of this Agreement to the Company within twenty-one (21) days after her receipt of this
Agreement, and does not revoke this Agreement within seven (7) days after she signs it, the Company
will pay to Employee, pursuant to Section 5.2(c) of the Employment Agreement, an amount equal to
$268,000.00, which represents the Employee’s current Annual Salary, which amount shall be payable
over one (1) year in accordance with the Employer’s standard payroll practices or, at the option of
the Company, in a lump sum (the “Salary Payment”) and if Employee elects to continue her health
care insurance coverage under COBRA, the Company will pay Employee’s health insurance premium for
Employee and any covered dependants for the first twelve (12) months following the Acknowledgment
Date (the “Benefit Continuation”), as such premiums are incurred by Employee. Employee shall also
receive $118,938, which represents Employee’s bonus earned over the previous four quarters of the
Term immediately prior to this Agreement, the first fifty percent (50%) of which amount shall be
payable on or before December 30, 2010 and the other fifty percent (50%) shall be payable on or
before July 1, 2011(the “Bonus Payment” and together with the Salary Payment, the “Payment”).
Employee shall also have the right to immediately exercise any or all stock options which are
vested as provided in section 5.2(c)(v) in the Employment Agreement for a
period of up to twelve (12) months after the Acknowledgement Date subject to her delivery of a
signed copy of this Agreement (the “Stock Options”). Additionally, the Company agrees that in any
transaction constituting a “Change of Control” (as defined in the Employment Agreement), Employee
will be included in any continuing “tail” coverage with respect to director and officer insurance
policies that may be purchased for or provided to the current directors and officers of the Company
at the time of any such Change of Control, as if Employee were still employed by the Company.
3. Cooperation. Employee will make herself available at reasonable times upon
reasonable request of the Company to the extent reasonably needed by the Company to complete
documentation or provide information relating to the period during which Employee was employed by
the Company.
4. Release by Employee.
a. General Release by Employee. In exchange for the Payment, the Benefit
Continuation, the Stock Options and the other consideration set forth in this Agreement,
Employee does hereby release and forever discharge the “Company Releasees” herein,
consisting of Employer, its parent, subsidiary and affiliate corporations, and each of
their respective past and present parents, subsidiaries, affiliates, associates, owners,
members, stockholders, predecessors, successors, assigns, employees, agents, directors,
officers, partners, representatives, lawyers, and all persons acting by, through, under, or
in concert with them, or any of them, of and from any and all manner of claims or causes
of action, in law or in equity, of any nature whatsoever, known or unknown, fixed or
contingent (hereinafter called “Employee Claims”), that Employee now has or may hereafter
have against the Company Releasees by reason of any and all acts, omissions, events or
facts occurring or existing prior to the Date of this Agreement. The Employee Claims
released hereunder include, without limitation, any alleged breach of any express or
implied employment agreement; any alleged torts or other alleged legal restrictions
relating to the Employee’s employment and the termination thereof; and any alleged
violation of any federal, state or local statute or ordinance including, without
limitation, Title VII of the Civil Rights Act of 1964, as amended, 42 USC Section 2000,
et seq.; Americans with Disabilities Act, as amended, 42 U.S.C. § 12101
et seq.; the Rehabilitation Act of 1973, as amended, 29 U.S.C. § 701
et seq.; Civil Rights Act of 1866, and Civil Rights Act of 1991; 42 USC
Section 1981, et seq.; Age Discrimination in Employment Act, as amended, 29
USC Section 621, et seq.; Equal Pay Act, as amended, 29 USC Section 206(d);
regulations of the Office of Federal Contract Compliance, 41 CFR Section 60, et
seq.; The Family and Medical Leave Act, as amended, 29 U.S.C. § 2601 et
seq.; the Fair Labor Standards Act of 1938, as amended, 29 U.S.C. § 201 et
seq.; the Employee Retirement Income Security Act, as amended, 29 U.S.C. § 1001
et seq.; and the California Fair Employment and Housing Act, California
Government Code Section 12940, et seq, as well as all Florida and
Connecticut state laws of a similar nature. This release shall not apply to the Company’s
obligations hereunder, to any vested retirement plan benefits, Employee’s rights under
Labor Code Section 2802 with respect to claims asserted against her, or her rights as a
stockholder of the Company.
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b. Unknown Claims.
Employee acknowledges that Employee are familiar with the provisions of California civil code
section 1542, which provides as follows:
“A general release does not extend to claims which the creditor does not
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 being aware of said code section, hereby expressly waives any rights Employee may have
thereunder, as well as under any other statutes or common law principles of similar effect.
c. Older Worker’s Benefit Protection Act.
Employee agrees and expressly acknowledges that this Agreement includes a waiver and release
of all claims which she has or may have under the Age Discrimination in Employment Act of 1967, as
amended, 29 U.S.C. § 621, et seq. (“ADEA”). The following terms and conditions
apply to and are part of the waiver and release of the ADEA claims under this Agreement:
(1) This Section, and this Agreement are written in a manner calculated to be
understood by him.
(2) The waiver and release of claims under the ADEA contained in this Agreement does
not cover rights or claims that may arise after the Date of this Agreement.
(3) This Agreement provides for consideration in addition to anything of value to which
she is already entitled.
(4) Employee has been advised to consult an attorney before signing this Agreement.
(5) Employee has been granted twenty-one (21) days after she is presented with this
Agreement to decide whether or not to sign this Agreement. If she executes this Agreement
prior to the expiration of such period, she does so voluntarily and after having had the
opportunity to consult with an attorney, and hereby waives the remainder of the twenty-one
(21) day period.
(6) Employee has the right to revoke this general release within seven (7) days of
signing this Agreement. In the event this general release is revoked, this Agreement will
be null and void in its entirety, and she will not receive the Payment or the Benefit
Continuation.
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If she wishes to revoke this agreement, Employee shall deliver written notice stating her
intent to revoke this Agreement to Xxxxx Xxxxxx, General Counsel at the offices of Employer on or
before 5:00 p.m. on the seventh (7th) day after the Date of this Agreement.
d. No Assignment. Employee represents and warrants to the Company Releasees
that there has been no assignment or other transfer of any interest in any Employee Claim
that the Employee may have against the Company Releasees, or any of them. Employee agrees
to indemnify and hold harmless the Company Releasees from any liability, claims, demands,
damages, costs, expenses and attorneys’ fees incurred as a result of any person asserting
such assignment or transfer of any right or claims under any such assignment or transfer
from Employee.
e. No Actions. Employee represents and warrants that she is not presently
aware of any injury for which she may be eligible for workers’ compensation benefits.
Employee agrees that if Employee hereafter commences, joins in, or in any manner seeks
relief through any suit arising out of, based upon, or relating to any of the Employee
Claims released hereunder or in any manner asserts against the Company Releasees any of the
Employee Claims released hereunder, then Employee will pay to the Company Releasees against
whom such claim(s) is asserted, in addition to any other damages caused thereby, all
attorneys’ fees incurred by such Company Releasees in defending or otherwise responding to
said suit or Employee Claim. Provided, however, that Employee shall not be obligated to
pay the Company Releasees’ attorney’s fees to the extent such fees are attributable to
claims under the Age Discrimination in Employment Act or a challenge to the validity of the
release of claims under the Age Discrimination in Employment Act.
5. Non-Disparagement/Litigation Assistance. Employee agrees to refrain from any
disparagement, defamation, or slander of the Company, its subsidiaries, employees, investors,
officers, directors, shareholders, agents, or partners, and Employee agrees to refrain from any
tortious or wrongful interference with Company’s contracts and relationships. Employer agrees to
refrain from any disparagement, defamation, or slander of Employee. Employee agrees not to assist
in the prosecution of litigation against Company, its officers, directors, or employees, except as
compelled by legal process, and Employee further agrees not to commence, maintain, prosecute or
participate in (except as may be required by law, pursuant to court order, or in response to a
valid subpoena) any action, charge, complaint, or proceeding of any kind (on her own behalf and/or
on behalf of any other person or entity and/or on behalf of or as a member of any alleged class of
persons) in any court, or before any administrative or investigative body or agency (whether
public, quasi-public or private) against Company, its officers, directors, or employees, with
respect to any act, omission, transaction or occurrence arising out of employment or this
Agreement. This provision will not apply to conduct as to which this provision would be unlawful.
6. No Admission. The Parties further understand and agree that neither the payment of
money nor the execution of this release shall constitute or be construed as an admission of any
liability whatsoever by the Company Releasees.
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7. Severability. The provisions of this Agreement are severable, and if any part of
it is found to be unenforceable, the other Sections (or portions thereof) shall remain fully valid
and enforceable.
8. Confidentiality. The terms of this Agreement are intended to be kept confidential
by the parties. Employer would not enter into this Agreement but for Employee’s promise to
maintain the confidentiality of the terms of and existence of this Agreement. Employee may not
disclose the terms of this Agreement to any person, except that Employee may disclose the terms of
this Agreement as may be required by law or to her immediate family, attorneys, tax and financial
advisors, provided that such individuals agree to be bound by the confidentiality provisions of
this Agreement. Company will be required to disclose the terms of this Agreement, including a copy
of this agreement, with the Securities and Exchange Commission on Form 8-K.
9. Arbitration. Company and Employee shall use good faith efforts to resolve any
controversy or claim arising out of, or relating to this Agreement or the breach thereof. If,
despite their good faith efforts, the parties are unable to resolve such controversy or claim
through the Company’s internal review procedures, then such controversy or claim shall be resolved
by binding arbitration before a single, mutually acceptable arbitrator under the rules of the
Judicial Arbitration and Mediation Service in Orange County, California and judgment upon the award
rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof. If any
contest or dispute shall arise between the Company and the Employee regarding any provision of this
Agreement, the prevailing party, as determined by the Arbitrator, shall be entitled to an award of
all legal fees, costs, and expenses reasonably incurred in connection with such contest or dispute.
10. Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the state of California without regard to conflicts of laws principles.
11. Withholding. All compensation or benefits payable to Employee pursuant to the
terms of this Agreement shall be subject to deduction of all required federal and state withholding
taxes and any other employment taxes the Company may be required to collect or withhold.
12. Entire Agreement, No Oral Modification. This Agreement represents the sole and
entire agreement among the Parties and supersedes all prior agreements, negotiations, and
discussions between the Parties hereto and/or their respective counsel, excluding any agreements
concerning confidentiality, trade secret information, or assignment of intellectual property
rights. Any agreement amending or superseding this Agreement must be in writing, signed by duly
authorized representatives of the Parties, specifically references the Employment Agreement, as
modified by this Agreement; and state the intent of the Parties to amend or supersede the
Employment Agreement, as modified by this Agreement. Except as expressly modified by the terms of
this Agreement, any and all outstanding stock options granted to Employee by the Company shall
remain subject to the terms and conditions of the relevant stock option agreements evidencing such
options and the relevant plan under which such options were granted (in each case, either the
Company’s 1999 Equity Incentive Plan, 2000 Equity Incentive Plan, 2004 Equity Incentive Plan, 2005
Equity Incentive Plan, 2007 Equity
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Incentive Plan or 2008 Equity Incentive Plan). Notwithstanding anything to the contrary set
forth in this Agreement, the rights and obligations of the Parties set forth in the Employment
Agreement that, by their terms, should survive the termination of the Employment Agreement beyond
the termination of Employee’s employment hereby shall continue in full force and effect, including
without limitation (i) Section 3.3 with respect to the vesting of additional options in certain
“Change of Control” circumstances, (ii) Section 3.6, (iii) Section 5.2(c)(v) with respect to the
vesting of additional options in certain “Change of Control” circumstances, (iv) Section 6.1, (v)
Section 6.2, (vi) Section 6.5, and (vii) Section 7, excluding subsection 7.12. In the event of the
death of Employee prior to the fulfillment of all of Company’s obligations hereunder, all rights of
Employee in this Agreement shall be transferrable to Employee’s heirs.
| Xxxxx.xxx Corporation |
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| Date: October 18, 2010 | By: | /s/ Xxxxx Xxxxxx | ||
| Title: | CEO | |||
| Employee |
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| Date: October 18, 2010 | /s/ Xxxxxx Xxxxx | |||
| Xxxxxx Xxxxx | ||||
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