SEVERANCE AGREEMENT AND RELEASE
Exhibit 10.23
SEVERANCE AGREEMENT AND RELEASE
TIIlS SEVERANCE AGREEMENT AND RELEASE ("Agreement") is entered into as of the date on the signature page, by and between MM Enterprises USA, LLC, a Delaware limited liability company, and its owners, officers, directors, employees, agents, assigns, parents, affiliates, subsidiaries, and successors in interest and merged (predecessor) entities (collectively, the "Company") and Xxxxxxx X. Xxxxxx ("Employee") (together the "Parties").
This Agreement is entered into with reference to the following facts:
The parties acknowledge that the Recitals stated above are fully incorporated and are part of this Agreement.
Employee acknowledges that Company is not entering into this Agreement because it believes that Employee has any cognizable legal claim against the Released Parties (defined below). IfEmployee elects not to sign this Agreement, the fact that this Agreement was offered will not be understood as an indication that the Released Parties believed Employee was treated unlawfully in any respect.
1 |
(a) The Company agrees to waive the clawback provisions of Employee's signing bonus of Two Hundred Thousand Dollars and No Cents ($200,000.00), granted to Employee in that certain offer letter dated December 5, 2018 ("Signing Bonus"), such that Employee will keep his Signing Bonus, effective eight days after the day that Employee signs the Agreement and delivers it to Company (the "Effective Date"); and
(b) A grant of public company stock with a value of Two Hundred Thousand Dollars and No Cents ($200,000.00) in MedMen Enterprises, Inc. ("MlVIB, Inc."). The stock grant shall be made on December 31, 2019 and priced as of the date of grant, subject to vesting as follows (i) one third will vest on April 11, 2020; (ii) one third will vest on October 11, 2020; and (iii) the final third will vest on April 11, 2021. The grant of said stock shall be subject to full compliance by the parties with the terms, conditions and requirements of the governing documents for that Company. All stock issued hereunder shall contain the standard legend referencing the Securities Act of 1933 that is attached to all shares of the Company's stock that are issued to U .S. residents.
Employee specifically acknowledges and agrees that the Severance Payment set forth in this Section 3 constitutes adequate and full consideration for this Agreement. Employee further acknowledges that he would not otherwise be entitled to this Severance Payment under any employment agreement, Company policy, or any law.
5. Stock Options. Company and Employee acknowledge that Employee was granted certain non-qualified stock options in MedMen Enterprises, Inc. (the "Options"), to purchase up to $5,000,000.00 of Class B Subordinate Voting Shares, pursuant to an offer letter dated December 5, 2018 ("Award Agreement"). Employee expressly acknowledges and agrees that, as of the Separation Date, his interests in the Options issued pursuant to the Award Agreement have not vested. Employee expressly acknowledges and agrees that, on the Effective Date, and in consideration of the Separation set forth below in this Agreement, and the other terms and conditions of this Agreement, Employee will and hereby does forfeit all rights, title and interest, whether legal or equitable, vested or unvested, actual or contingent, in, under or to the Options under the Award Agreement or otherwise, such that as of the Separation Date, Employee shall have no claims or rights in or to any Options under the Award Agreement or otherwise in or with respect to the stock of MedMen Enterprises, Inc. Employee further agrees to execute such other documents as may be required to confirm and effectuate the tennination and forfeiture of the Award Agreement, and the Options.
2 |
Employee and Company acknowledge and agree that Company has paid Employee the sum of (i) all amounts earned as wages during the period commencing at the end of the regularly scheduled pay period ending on the Separation Date, and (ii) all accrued but unused vacation, sick or skip time and/or paid time off (collectively "Final Pay") on the Separation Date. Employee further acknowledges that Company has provided him all meal and rest periods, overtime pay, and has been fully reimbursed for any unpaid business expenses under the California Labor Code.
Employee agrees that as of the Separation Date, Company shall have no obligation to Employee other than Final Pay and any duties and obligations created by this Agreement. By cashing, depositing, or otherwise negotiating Company's check, Employee will conclusively agree that amounts received as Final Pay are correct and constitute payment in full of all amounts due Employee.
9. Employee's Release and Waiver. Employee hereby forever releases and discharges Company and its affiliates (including but not limited to MMMG, LLC a Nevada limited liability company and MedMen Enterprises, Inc.), successors and assigns, as well as each of its past and present officers, directors, employees, agents, attorneys, insurers, and shareholders (collectively, the "Released Parties"), from any and all claims, charges, complaints, liens, demands, causes of action, obligations, damages and liabilities, known or unknown, suspected or unsuspected, that Employee had, now has or may hereafter claim to have against the Released Parties arising out of or relating in any way to Employee's employment with and separation from Company (including but not limited to any claims arising out of or relating in any way to the employment or the Options), or otherwise relating to any of the Released Parties from the beginning of time to the date of this Agreement (the "Release"). This Release specifically extends to, without limitation, any and all claims or causes of action for wrongful termination, breach of an express or implied contract, breach of the covenant of good faith and fair dealing, breach of fiduciary duty, fraud, misrepresentation, defamation, slander, infliction of emotional distress, disability, loss of future earnings, and any claims under any applicable state, federal or local statutes and regulations, including, but not limited to, the Civil Rights Act of 1964, as amended, the Equal Pay Act of 1963, as amended, the Fair Labor Standards Act, as amended, the Americans with Disabilities Act of 1990, as amended, the Rehabilitation Act of 1973, as amended, the Employee Retirement Income Security Act of 1974, as amended, the Age Discrimination in Employment Act, as amended, the Older Workers' Benefits Protection Act (29 U.S.C. §626), as amended, the Worker Adjustment and Retraining Notification Act, as amended, Section 806 of the SarbanesOxley Act, the Family and Medical Leave Act, as amended, the California Family Rights Act, as amended, the California Fair Employment and Housing Act, as amended, and the California Labor Code; provided, however, that this Release does not waive, release, or otherwise discharge any claim or cause of action that cannot legally be waived as a matter of law, including, but not limited to, workers' compensation benefits and unemployment benefits.
3 |
To comply with the Older Workers' Benefits Protection Act (29 U.S.C. §626(.f)) and effectuate the release by Employee of any potential claims under the federal Age Discrimination in Employment Act, Employee agrees as follows:
(a) Employee specifically understands and acknowledges that the Age Discrimination in Employment Act of 1967, as amended, provides Employee the right to bring a claim against the Released Parties if Employee believes that the Release Parties have discriminated against Employee on the basis of age. Employee understands the rights under this Act and agrees that, by signing this Agreement, Employee may not file any claim or action against any of the Released Parties based on any alleged violation(s) of the Age Discrimination in Employment Act through the Effective Date of this Agreement. Employee waives any right to assert a claim for relief available under the Age Discrimination in Employment Act, including, but not limited to, back pay, attorneys' fees, damages, lost benefits, reinstatement or injunctive relief for any act or omission by any of the Released Parties through the Effective Date of this Agreement.
(b) Employee understands and agrees that Employee has twenty-one (21) calendar days to consider this Agreement. Employee is advised to consult an attorney regarding this, and all provisions, in this Agreement before signing it. Employee further acknowledges, understands, and agrees that if Employee signs this Agreement prior to the twenty-one (21) day period expiring, the decision to do so is Employee's and that as a result, Employee will have voluntarily, knowingly, and willingly waived the twenty-one (21) day period. Employee further acknowledges, understands, and agrees that this Agreement shall not become effective and enforceable until seven (7) calendar days after Employee has signed it. During this seven (7) calendar-day-period, Employee may revoke this Agreement ("Revocation Period"). If Employee elects to revoke this Agreement during this seven-day period, Employee agrees to deliver or cause the revocation in writing to be delivered to MedMen's Corporate Office, (Attn: llll) 0000 Xxxxxxxxx Xxxxxxxxx, Xxxxx X, Xxxxxx Xxxx, Xxxxxxxxxx 00000. Employee will ensure that such notification will arrive within this seven (7) day period. Employee understands that revoking this Agreement will void it and he will not be entitled to any benefits under this Agreement.
4 |
10. Waiver Under Section 1542 of the California Civil Code. For the purpose of implementing a full and complete release, Employee understands and agrees that this Agreement is intended to include all claims, if any, which Employee may have and which Employee does not now know or suspect to exist in his favor against the Released Parties and this Agreement extinguishes those claims. Accordingly, Employee expressly waives all rights afforded by Section 1542 of the Civil Code of the State of California ("Section 1542") and any similar statute or regulation in any other applicable jurisdiction. Section 1542 states as follows:
| A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN ms OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE AND THAT, IF KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY. |
|
Employee understands that Section 1542 gives him the right not to release existing claims of which he is not now aware, unless he voluntarily chooses to waive this right. Even though Employee is aware of the rights described in Section 1542, Employee nevertheless hereby voluntarily waives such rights and elects to assume all risks for claims that now exist in his favor, known or unknown, arising from the subject matter of the general release in this Agreement.
12. Participation in Agency Proceedings. Nothing in this Agreement shall prevent Employee from filing a charge (including a challenge to the validity of this Agreement) with the Equal Employment Opportunity Commission (the "EEOC"), the National Labor Relations Board (the ''NLRB"), the California Department of Fair Employment and Housing (the "DFEH"), or other similar federal, state, or local agency, from participating in any investigation or proceeding conducted by the EEOC, the NLRB, the DFEH, or similar federal, state or local agencies, or testifying in an administrative, legislative, or judicial proceeding concerning alleged criminal conduct or alleged sexual harassment on the part of any other party, or on the part of the agents or employees of another party, when the person testifying has been required or requested to attend the proceeding pursuant to a court order, subpoena, or written request from an administrative agency or legislature. However, by entering into this Agreement, Employee understands and agrees that Employee is waiving any and all rights to recover any monetary relief or other personal relief as a result of any such EEOC, NLRB, DFEH or similar federal, state, or local agency proceeding, including any subsequent legal action.
5 |
13. Trade Secrets and Confidential Information/Company Property. Employee's signature below constitutes his certification that he has returned all documents, property, and other items provided to him by the Company, developed, or obtained by him in connection with his employment with the Company, or otherwise belonging to the Company. Employee further represents, warrants, and agrees that he will continue to comply with all terms and conditions of any and all Confidentiality Agreements, Non-Disclosure Agreements, or any other Agreement to Protect Proprietary Information of Employer, and that such continuing obligations survive the ending of his employment. Employee represents and warrants that he has not to date and will not misuse or disclose Confidential Information to any unauthorized party. Employee understands and acknowledges that this representation and warranty extends to his continuing duty of non- disclosure related to any and all privileged information obtained during his employment with the Company. Employee hereby grants consent to notification by Company to any new employer of Employee about Employee's obligations under this provision.
6 |
7 |
20. Agreement Not to Disclose Information or Documents. Employee agrees to protect attorney-client privileged communications and private information and documentation concerning xxxxxx and/or current Company employees that Employee learned about or was privy to during his employment at Company.
21. Governing Law and Choice of Venue. This Agreement and all rights, duties and remedies hereunder shall be governed by and construed and enforced in accordance with the laws of the State of California, without reference to its choice of law rules. Any disputes under this Agreement shall be adjudicated exclusively in the state court of Los Angeles County, California.
8 |
IN WITNESS WHEREOF, the parties have executed this Agreement as of the dates set forth below.
COMPANY MM ENTERPRISES USA, LLC |
| EMPLOYEE |
| |
|
|
|
|
|
By: | /s/ Xxxx Xxxxxxx |
| /s/ Xxxxxxx X. Xxxxxx |
|
| Name: Xxxx Xxxxxxx |
| Xxxxxxx X. Xxxxxx |
|
| Its CEO |
|
|
|
| Date: 10/7/19 |
| Date: 10/7/19 |
|
9 |
ELECTION TO EXECUTE PRIOR TO EXPIRATION
OF 21-DAY CONSIDERATION PERIOD
I, Xxxxxxx X. Xxxxxx, understand that I have twenty-one (21) days within which to consider and execute the attached Severance Agreement and Release. However, after having an opportunity to consult counsel, I have freely and voluntarily elected to execute the Severance Agreement and Release before such twenty-one (21) day period has expired.
10/7/19 |
| /s/ Xxxxxxx X. Xxxxxx |
|
Date |
| Signature |
|
10 |