Exhibit 10(6)
RELEASE AND SETTLEMENT AGREEMENT
THIS AGREEMENT is made this 20th day of June, 1996, between Xxxx Xxxxx
("Xxxxx") and Interface Systems, Inc., a Delaware corporation ("Interface").
RECITALS
X.Xxxxx is presently employed by Interface but desires to resign effective
June 20, 1996 with respect to his position as President, Chief Executive
Officer and effective September 10, 1996 as an employee; and
X. Xxxxx desires to resign full-time employment for personal reasons; and
X.Xxxxx and Interface recognize that continued association and finalization
of all matters relating to Xxxxx'x employment would be of assistance to
Xxxxx and Interface; and
D.Interface is not obligated to pay Xxxxx any additional compensation or
benefits other than that which he has earned through June 30, 1996 with the
understanding that Xxxxx will be on an unpaid leave of absence until
September 10, 1996.
In consideration of the foregoing and of the promises and the mutual
covenants contained herein, it is hereby agreed between Xxxxx and Interface
as follows:
AGREEMENT
1. Xxxxx voluntarily agrees to resign as President,
Chief Executive Officer and all other positions, except as a member of the
Board of Directors of Interface, which he holds with Interface or its
subsidiaries including, but not limited to, his position as a trustee of
Interface's 401(k) Plan effective June 20, 1996.
2. Xxxxx voluntarily agrees to resign as an employee of
Interface effective September 10, 1996 . Xxxxx understands and agrees that
he will be on an unpaid leave of absence from July 1, 1996 until September
10, 1996. Xxxxx further agrees that unless he exercises his right to
rescind the Agreement pursuant to paragraph 25, he will not and cannot
rescind the resignations set forth in paragraphs 1 and 2 hereof. Xxxxx
waives his right to all benefits and rights as an employee except for those
under any Interface Stock Option Plan.
3. Interface agrees to retain Xxxxx as an independent
contractor for a 24-month period beginning July 1, 1996, to consult with
Interface upon Interface's request regarding the business of Interface. For
making himself available at such time as specified by Interface and
rendering services as specified by Interface, Xxxxx shall be paid $16,000
per month payable at such times as his base compensation was payable when he
was still an employee.
4. Any rights Xxxxx has under any stock option plan of
Interface are not affected by this Agreement.
5. Xxxxx presently owes Interface $600,000 pursuant to
two (2) promissory notes and a pledge agreement. These notes remain in full
force and effect.
6. Xxxxx additionally owes Interface approximately
$100,000 for, among other things, advances outstanding. Xxxxx agrees to
sign a promissory note for such amount The amount of the note shall be
repaid in 18 equal monthly installments, which amount shall be deducted from
the payments set forth in Paragraph 3 above.
7. Xxxxx recognizes that the amounts to be paid to him
pursuant to this Agreement are in excess of any earned wages or benefits due
and owing Xxxxx through his separation date.
8. In exchange for the good and valuable consideration
set forth in this Agreement, Xxxxx, on behalf of himself, his heirs,
executor and assigns, releases, waives and discharges any and all manner of
action, causes of action, claims, rights, charges, suits, damages, debts,
demands, obligations, attorneys' fees, or any and all other liabilities or
claims of whatsoever nature, whether individually or derivatively, whether
in law or in equity, known or unknown, including, but not limited to, any
claim and/or claim of damages or other relief for tort, breach of contract,
personal injury, negligence, loss of consortium, age discrimination under
The Age Discrimination In Employment Act of 1967 (as amended), employment
discrimination prohibited by other federal, state or local laws including
sex, race, national origin, marital status, age, handicap, height, weight,
or religious discrimination, and any other claims for unlawful employment
practices which Xxxxx has claimed or may claim or could claim in any local,
state or federal forum, against Interface, its directors, officers,
employees, attorneys, agents, successors and assigns and affiliates and
subsidiaries, and their officers, directors, employees, attorneys, agents,
successors and assigns, and all others ("Interface Representatives").
9. Xxxxx may submit a letter of resignation which will
be placed in his file.
10. Xxxxx and Interface intend that this Agreement will
irrevocably bar any action or claim whatsoever by Xxxxx against Interface
and Interface Representatives for any resultant injuries or damages, whether
known or unknown, sustained or to be sustained, as a result of any acts,
omissions and conduct of Interface and Interface Representatives having
occurred up to the present date including, but not limited to, Xxxxx'x
employment with Interface and the termination of that employment.
11. Xxxxx understands that he does not waive rights or
claims that may arise after the date this Agreement is executed, but Xxxxx
understands and agrees that this Agreement and the release language in
paragraph 8 apply to his decision to resign as an employee and his waiver of
any right to rescind that resignation except as set forth in paragraph 25 of
the Agreement.
12. Xxxxx further agrees that he has read this Agreement
carefully and understands all of its terms.
13. Xxxxx understands and agrees that he was advised to
consult with an attorney prior to executing this Agreement and that he has
entered into this Agreement with the advice of his attorney.
14. Xxxxx understands and agrees that he has been given
21 days (or more) within which to consider this Agreement.
15. Xxxxx and Interface acknowledge that this Agreement
reflects their desire to terminate all aspects of their employment
relationship in an orderly and amicable fashion. The parties in no way
acknowledge any fault or liability to the other party or any other person or
entity and this Agreement shall not in any way be construed as an admission
by either party or any other person or entity of any fault or liability to
the other party or any other person or entity.
16. Xxxxx agrees that he will not receive, is not
entitled to receive and will not claim any salary, bonus, benefits,
severance pay, other compensation, expenses or other payment of any kind
other than that which is specifically set forth in this Agreement.
17. Xxxxx represents and agrees that he has kept and will
keep the fact, amount and terms of his employment relationship and of this
Agreement completely confidential, and that he will not hereafter disclose,
except as required by law, any information concerning the fact, amount or
terms of this Agreement to any person other than his immediate family, his
attorney and his tax advisor (collectively, "Xxxxx'x Confidants"), provided
each is informed of and agrees to be bound by this confidentiality
provision.
By way of illustration and without limitation, neither Xxxxx
nor any of Xxxxx'x Confidants shall disclose the fact, amount, or terms of
this Agreement to anyone, including, but not limited to, any representative
of any print, radio or television media; to any past, present or prospective
employee of, Interface or others released in this Agreement, or to
Interface's shareholders or to the public at large.
Nothing in this paragraph shall prohibit any party or his/its
counsel from disclosing the fact, amount or terms of this Agreement to a
court, arbitrator, administrative agency or other tribunal of appropriate
jurisdiction for the purpose of effectuating the provisions of this
Agreement.
18. Xxxxx understands and agrees that he will not in any
fashion, form or manner, either directly or indirectly, solicit or use for
his own purposes or for the purposes of any third party, "confidential
business information" in any form concerning Interface. As used in this
Agreement, "confidential business information" means any information
concerning the business and operations of Interface, its agreements or
relations with agents, contractors, customers or employees, the status of
work in progress, its products, processes, costs, pricing, customers,
employees, trade secrets, plans, commercial intentions, business practices,
or financial condition; provided, however, that "confidential business
information" shall not include information which (a) has been publicly
disclosed by Interface or included in any publicly available filing, report
or analysis or which is generally available to the public through lawful
means; (b) was known to Xxxxx by lawful means prior to his employment by
Interface; or (c) was created, produced, compiled, or developed by Xxxxx or
any other person independently and without the use of or reference to any
"confidential business information" of Interface.
Nothing in this Agreement shall preclude Xxxxx from
describing, without in any way disclosing "confidential business
information," in any general terms to prospective employers and business
associates, and to no one else, specifically and solely for the purpose of
securing other employment or a business association, the general nature of
the work he performed at Interface and the results he obtained as contained
and revealed in any public information about Interface.
Nothing in this Agreement shall preclude Xxxxx from making
such disclosures of "confidential business information" as may be required
by law, government regulation or court order, or as may be requested by
governmental officials or investigators concerning matters within their
official authority. In the event that disclosures of "confidential business
information" are made by Xxxxx under such circumstances, he shall take all
reasonably available steps to ensure that such information does not become
known to Interface's competitors, such as through conditioning disclosure
upon entry of an appropriate protective order or a confidentiality
agreement.
In view of the nature of Xxxxx'x employment and the
"confidential business information" which Xxxxx has received during the
course of his employment, Xxxxx agrees that Interface would be irreparably
harmed by any violation or threatened violation of this paragraph, and that,
therefore, Interface shall be entitled to an injunction prohibiting Xxxxx
from any violation or threatened violation of this paragraph. The
undertakings set forth in this paragraph shall survive the termination of
other arrangements contained in this Agreement.
19. Until July 1, 1998, Xxxxx shall not: (A) directly or
indirectly, either as an equity owner (except for the ownership of not more
than 1% of any class of equity securities traded actively over-the-counter
or through a national securities exchange), director, officer, employee,
sales person, consultant, advisor, agent, lender, or in any other capacity,
in any location in which Interface conducts its business, engage or be
interested in any business which is in substantial and direct competition
with the business of Interface or any of its subsidiaries; (B) take any
action with the intent of causing the termination of the business
relationship between Interface or any of its subsidiaries and any customer
or supplier of the Company; or (C) solicit for employment any person
employed in Interface's business or the business of its subsidiaries.
Xxxxx agrees that the Interface would be irreparably harmed
by any violation or threatened violation of this paragraph, and that,
therefore, Interface shall be entitled to an injunction prohibiting Xxxxx
from any violation or threatened violation of this paragraph. The
undertakings set forth in this paragraph shall survive the termination of
other arrangements contained in this Agreement.
20. Xxxxx agrees that he will not, and will use his best
efforts to see that his wife, attorney and accountant do not, make or
publish any negative, critical, disparaging, slanderous or libelous
statements about Interface or its subsidiary, affiliates, officers,
directors, agents, representatives or attorneys. Interface agrees that it
will not, and Interface will use its best efforts to see that its
subsidiary, affiliates, officers, directors, agents, representatives and
attorneys of Interface do not, make or publish any negative, critical,
disparaging, slanderous or libelous statements about Xxxxx.
21. Xxxxx represents and agrees that he will promptly
turn over to Interface all files, memoranda, records, all other documents,
badges, keys, credit cards and any other physical property of Interface,
which Xxxxx has in his possession, custody or control. Xxxxx agrees that he
will promptly vacate his office and remove from such office any personal
property which he may have in such office, and agrees that any property
which he does not remove shall become the personal property of Interface.
22.Xxxxx agrees that he will neither engage in nor support,
nor be a party to any shareholder action, derivative or otherwise, against
Interface or any of its officers, directors, employees, agents or attorneys
until the complete satisfaction of his obligations under the two promissory
notes referenced in paragraph 5 hereof.
23. Xxxxx agrees to comply with the volume limitations of
Rule No. 144 promulgated under the Securities Act of 1933 during the
24-month period commencing July 1, 1996.
24. Xxxxx hereby assigns and relinquishes any and all
claims he may have to any inventions, ideas, methods or concepts, whether or
not patentable, trademarkable or copyrightable for anything which he
developed, invented or worked on during his employment at Interface.
25. Xxxxx understands and agrees that he may revoke this
Agreement for a period of seven (7) calendar days following the execution of
this Agreement. The Agreement is not effective until this revocation period
has expired. Xxxxx understands that any revocation, to be effective, must
be in writing and either (a) postmarked within seven (7) days of execution
of this Agreement and addressed to Xxxxxx X. Xxxxxx, Interface Systems,
Inc., 0000 Xxxxxxxxx Xxxxx, Xxx Xxxxx, XX, or (b) hand delivered within
seven (7) days of execution of this Agreement to Xxxxxx X. Xxxxxx. Xxxxx
understands that if revocation is made by mail, mailing by certified mail,
return receipt requested, is recommended to show proof of mailing.
26. In agreeing to sign this Release and Settlement
Agreement, Xxxxx is doing so completely voluntarily and based on the advice
of his attorney and agrees that he has not relied on any oral statements or
explanations made by Interface or its representatives.
27. This Agreement is in full accord and satisfaction and
compromise of the claims of Xxxxx and Interface and is not to be construed
as an admission of liability on the part of Interface.
28. This Agreement contains the entire Agreement between
Xxxxx and Interface. Any modification of this Agreement must be made in
writing and signed by Xxxxx and Xxxxxx X. Xxxxxx on behalf of Interface
Systems, Inc.
/S/ Xxxx Xxxxx
----------------------------- ------------------------------
Witness Xxxx Xxxxx
Date: June 21, 1996
INTERFACE SYSTEMS, INC.
/S/ Xxxxx Xxxxxx
----------------------------- By: -----------------------------
Witness Xxxxx Xxxxxx
Its: Treasurer
Date:
NOTICE OF INTENTION TO SIGN BEFORE
EXPIRATION OF TWENTY-ONE (21) DAY REVIEW PERIOD
1. I understand that I have been offered twenty-one (21)
days to consider whether to sign and accept this Release and Settlement
Agreement. Nevertheless, it is my desire and intention to sign and accept
it at this time and I do so freely and voluntarily.
2. I understand that I have an opportunity to revoke the
Release and Settlement Agreement pursuant to its terms and that the time
period for revoking begins to run from the date of signature.
/S/ Xxxx Xxxxx
Dated: June 21, 1996 ----------------------------
Xxxx Xxxxx
