Exhibit 10.21
SEPARATION AGREEMENT
AND GENERAL RELEASE
This Separation Agreement and General Release ("Agreement") is made
and entered into this 7th day of June, 2002 (the "Effective Date"), by and
between Xxxxxxxx.xxx, Inc. (hereinafter the "Company" or "Employer") and Xxxx
Xxxxxxx Xxxxxx ("Employee") (hereinafter collectively referred to as the
"Parties"), and is made and entered into with reference to the following facts.
RECITALS
WHEREAS, Employee was hired by the Company as its Chief Financial
Officer pursuant to an offer letter dated March 12, 2001; and
WHEREAS, Employee holds 26,667 shares of restricted stock (the
"Restricted Shares") subject to the terms and conditions of a Stock Issuance
Agreement, dated May 11, 2001 (the "Stock Issuance Agreement"); and
WHEREAS, the Company granted Employee stock options (the "Stock
Options") under its 2000 Stock Incentive Plan (the "Plan") and subject to the
terms and conditions of Notices of Grant (the "Grant Notices"), the first such
option (the "March Option") having been granted on March 12, 2001, and the
second such option (the "August Option") having been granted on August 3, 2001;
and
WHEREAS, the Company and Employee have agreed to terminate their
employment relationship effective June 10, 2002; and
WHEREAS, the Parties each desire to resolve any potential disputes
which exist or may exist arising out of Employee's employment with the Company
and/or the termination thereof.
NOW THEREFORE, in consideration of the covenants and promises
contained herein, the Parties hereto agree as follows:
AGREEMENT
1. AGREEMENT BY EMPLOYEE. In exchange for the payments
described in paragraph 2 below, Employee agrees to the following:
(a) that he resigns from his employment with the Company
effective June 10, 2002 (hereinafter the "Resignation
Date");
(b) to provide consulting services to the Company under
the terms and conditions set forth in the Consulting
Agreement attached hereto as Exhibit A; and
(c) to be bound by the terms of this entire Agreement.
2. AGREEMENT BY THE COMPANY. In exchange for Employee's
agreement to be bound by the terms of this entire Agreement, including but
not limited to the Release of Claims in paragraph 3, the Company agrees to
the following:
(a) to pay to Employee $165,000, less statutory
deductions and withholdings payable in a lump-sum on
the first regular payroll date 8 days after the
Effective Date;
(b) to forgive in full, as of 8 days after the Effective
Date, the outstanding principal and accrued interest
under the Promissory Note executed by Employee on
August 7, 2001 (the "Promissory Note") and to cancel
and destroy the original Promissory Note 8 days after
the Effective Date;
(c) to accelerate the lapsing of the Company's right,
provided for in the Stock Issuance Agreement, to
repurchase the Restricted Shares so that it shall
lapse, as of 8 days after the Effective Date, as to
16,000 of the Restricted Shares and to deliver the
16,000 shares to Employee in registered form, freely
saleable and transferable within 10 business dates
after the Effective Date;
(d) to accelerate the vesting of the Stock Options so
that, as of 8 days after the Effective Date, the
March Option shall vest and be exercisable as to
41,904 option shares and the August Option shall vest
and be exercisable as to 16,666 option shares;
(e) to pay Employee his base salary and earned but unpaid
vacation days and reimburse him for all properly
evidenced business expenses incurred through the
Resignation Date and submitted within 30 days
thereof, and to preserve any continuing rights
Employee may have with respect to the option shares
that are vested pursuant to this Section and rights
under the Company's health and welfare benefit plan;
(f) to pay, upon request by Employee, for Employee's and
his eligible dependents', if any, continuation
coverage under the Company's medical and dental plans
pursuant to COBRA, until the first anniversary of the
Resignation Date assuming Employee properly elects
COBRA coverage and remains eligible for it during
that period; and
(g) that, notwithstanding anything to the contrary in the
Grant Notices or the Plan, Employee shall be
permitted to exercise any vested potion of the August
Option for a period of two years commencing upon the
Resignation Date.
Employee acknowledges that, absent this Agreement, he has no legal,
contractual or other entitlement to a substantial portion of the consideration
set forth in this Section and that the amount set forth in this Section
constitutes valid and sufficient consideration for Employee's release of claims
and other obligations set forth herein. Except as specifically provided for in
this Section 2, the Stock Options shall be governed by the terms of the Plan and
Grant Notices.
3. RELEASE OF CLAIMS. Employee, on behalf of himself and his
dependents, heirs, executors, administrators and assigns (hereinafter
collectively referred to as "Employee Releasees"), hereby expressly waives,
releases, acquits and forever discharges the Company and its divisions,
subsidiaries, affiliates, parents, related entities, officers, directors,
employees, successors and assigns, (hereinafter collectively referred to as
"Company Releasees"), from any and all claims, demands, and causes of action
which Employee has or claims to have, whether known or unknown, of whatever
nature,
which exist or may exist on Employee's behalf from the beginning of time up to
and including the Effective Date. As used in this paragraph, "claims,"
"demands," and "causes of action" include, but are not limited to, claims based
on contract, whether express or implied, claims based on the Stock Issuance
Agreement dated May 11, 2001, the offer letter dated March 12, 2001, the
Promissory Note dated August 7, 2001 fraud, stock fraud, defamation, wrongful
termination, estoppel, equity, tort, retaliation, intellectual property,
personal injury, spoliation of evidence, emotional distress, public policy, wage
and hour law, statute or common law, claims for severance pay, claims related to
stock options and/or fringe benefits, claims for attorneys' fees, vacation pay,
debts, accounts, compensatory damages, punitive or exemplary damages, liquidated
damages, and any and all claims arising under any federal, state, or local
statute, law, or ordinance prohibiting discrimination on account of race, color,
sex, age, religion, sexual orientation, disability or national origin, including
but not limited to, the New York Human Rights Law, the New York City
Administrative Code, the Age Discrimination in Employment Act, Title VII of the
Civil Rights Act of 1964 as amended, the Americans with Disabilities Act, the
Family and Medical Leave Act or the Employee Retirement Income Security Act
(except for rights that cannot be waived by law). Anything herein to the
contrary notwithstanding in this Agreement, nothing herein shall release any of
the Company Releasees from (i) any right or claim based on any right that
Employee has to enforce this Agreement, (ii) any right or claim for unemployment
insurance; (iii) any right or claim based on events occurring after the
Effective Date, (iv) any right or claim based on Employee's eligibility for
defense or indemnity in accordance with applicable law or the Company's
certificate of incorporation or by-laws or pursuant to any applicable insurance
policy, or (v) any right that Employee has under the Plan with respect to the
option shares that are vested pursuant to Section 2 or any right that Employee
has under the Company's health and welfare benefit plans.
4. RELEASE OF CLAIMS BY THE COMPANY. The Company hereby expressly
waives, releases, acquits and forever discharges Employee and any other Employee
Releasee, from any and all claims, demands, and causes of action which the
Company has or claims to have, whether known or unknown, of whatever nature,
which exist or may exist on the Company's behalf from the beginning of time up
to and including the Effective Date As used in this Section, "claims,"
"demands," and "causes of action" include, but are not limited to, claims based
on contract, whether expressed or implied, claims based on the Stock Issuance
Agreement dated May 11, 2001, the Offer Letter dated March 12, 2001, the
Promissory Note dated August 7, 2001, fraud, stock fraud, defamation, estoppel,
equity, tort, retaliation, intellectual property, personal injury, emotional
distress, public policy, claims for attorneys' fees, debts, accounts,
compensatory damages, punitive or exemplary damages, liquidated damages, and any
and all claims arising under any federal, state, or local statute, law, or
ordinance or alleged violation of any other legal, contractual or fiduciary
obligation. Anything herein to the contrary notwithstanding in this Agreement,
nothing herein shall release any of Employee Releasees from any right or claim
based on (i) any right that the Company has to enforce this Agreement, (ii) any
right or claim based on events occurring after the Effective Date or (iii) any
claim based on fraud, embezzlement, or intentional malfeasance by Employee
unknown to an officer or director (other than Employee) of the Company as of the
Effective Date.
5. LAST DATE OF EMPLOYMENT. It is understood and agreed that
Employee's last date of employment with the Company is June 10, 2002.
6. RECEIPT OF WAGES AND OTHER COMPENSATION. Except as otherwise
provided in Section 2, Employee acknowledges and agrees that, prior to his
execution of this Agreement, he has received payment for all wages, salary,
bonuses, accrued vacation, and all other compensation owed to Employee by the
Company.
7. COMPANY PROPERTY/PROPRIETARY INFORMATION. Employee agrees to
continue to abide by the terms of the Company's Proprietary Information,
Inventions and Nonsoliciation Agreement
(the "PIIN Agreement"), the terms of which are incorporated herein by reference
and a copy of which is attached hereto as Exhibit B provided, however, that the
PIIN Agreement is hereby amended such that (a) the last sentence of Section 4.1
is deleted and (b) Section 3.2 is amended such that Employee can disclose Trade
Secrets as required by law or by any court, arbitrator, mediator or
administrative or legislative body (including any committee thereof) with
apparent jurisdiction or authority to order or require such person to disclose
or make accessible such information.
8. ACCEPTANCE OF AGREEMENT/REVOCATION. This Agreement was received
by Employee in its final form on June 7, 2002. Employee may accept this
Agreement by returning a signed original to the Company. This Agreement shall be
withdrawn if not accepted in the above manner on or before July 1, 2002.
Employee shall have seven (7) days after the Effective Date to revoke this
Agreement by delivering written confirmation of revocation to the Company within
the seven (7) day period. If Employee revokes this Agreement during such seven
(7) day period, this Agreement shall be null and void.
9. NON-ADMISSION OF LIABILITY. The Company denies any wrongdoing
whatsoever in connection with its dealings with Employee, including but not
limited to Employee's employment and termination. It is expressly understood and
agreed that nothing contained in this Agreement shall constitute or be treated
as an admission of any wrongdoing or liability on the part of the Company or the
Employee.
10. NO FILING OF CLAIMS. Employee represents and warrants that he
does not presently have on file, and further represents and warrants that,
unless such representation or warranty is otherwise prohibited by law, he will
not hereafter file, any claims, charges, grievances or complaints with respect
to the claims released by Employee herein against any of the Company Releasees
(defined above) in or with any administrative, state, federal or governmental
entity, agency, board or court, or before any other tribunal or panel or
arbitrators, public or private. The Company represents and warrants that it does
not presently have on file, and further represents and warrants that, unless
such representation or warranty is otherwise prohibited by law, it will not
hereafter file, any claims, charges, grievances or complaints with respect to
the claims released by the Company herein against any of Employee Releasees
(defined above) in or with any administrative, state, federal or governmental
entity, agency, board or court, or before any other tribunal or panel or
arbitrators, public or private.
11. OWNERSHIP OF CLAIMS. Employee represents and warrants that he is
the sole and lawful owner of all rights, title and interest in and to all
released matters, claims and demands referred to herein. The Parties further
represent and warrant that there has been no assignment or other transfer of any
interest in any matters, claims or demands released herein.
12. CONFIDENTIALITY. Until and unless this Agreement is publicly
disclosed by the Company, Employee understands and agrees that this Agreement,
and the matters discussed in negotiating its terms, are entirely confidential.
It is therefore expressly understood and agreed that, until such time as the
Company publicly discloses this Agreement, Employee will not reveal, discuss,
publish or in any way communicate any of the terms, amount or fact of this
Agreement to any person, organization or other entity, with the exception of
disclosure (i) to his immediate family members and professional representatives
(including financial, tax and legal), (ii) to any prospective employer, but only
to the extent necessary to inform such employer concerning any restrictions in
the PIIN regarding Employee's ability to perform services for such employer;
(iii) required by law or by any court, arbitrator, mediator or administrative or
legislative body (including any committee thereof) with apparent jurisdiction or
authority to order or require such person to disclose or make accessible such
information or (iv) with respect to any litigation, arbitration or mediation
involving this Agreement. Employee further agrees that for 18 months after the
Effective Date he will not knowingly make any statements to any third
parties that disparage the Company or its officers and/or directors personally
or professionally. The Company agrees that for 18 months after the Effective
Date the Company and its officers and directors will not knowingly make any
statements to any third parties that disparage Employee personally or
professionally. Nothing in this Section 12 shall prevent any person from (i)
from making any truthful statement to the extent (x) necessary in connection
with any litigation, arbitration or mediation involving this Agreement,
including, but not limited to, the enforcement of this Agreement or (y) required
by law or by any court, arbitrator, mediator or administrative or legislative
body (including a committee thereof) with apparent jurisdiction or authority to
order or require such person to disclose or make accessible such information.
The Company further agrees to provide Employee with a recommendation letter
substantially in the form attached hereto as Exhibit C.
13. TAX OBLIGATIONS. It is understood and agreed that Employee is
liable for all tax obligations, if any, with respect to the settlement payments
provided for herein.
14. INDEMNIFICATION. The Company agrees to indemnify and defend,
including advancing of expenses, Employee to the maximum extent permitted by the
Company's Certificate of Incorporation and By-laws. The Company further agrees
that Employee will be provided with whatever coverage he is entitled to as a
former officer under the Company's directors' and officers' liability insurance
policy.
15. NEW YORK LAW APPLIES. This Agreement, in all respects, shall be
interpreted, enforced and governed by and under the laws of the State of New
York without reference to conflicts of law principles. Any and all actions
relating to this Agreement shall be filed and maintained in the federal and/or
state courts located in the State of New York, and the parties consent to the
jurisdiction of such courts. Each party shall be responsible for its own costs
and expenses, including attorneys' fees.
16. SUCCESSORS AND ASSIGNS. The Parties expressly understand and
agree that this Agreement, and all of its terms, shall be binding upon their
representatives, heirs, executors, administrators, successors and assigns. In
the event of Employee's death or a judicial determination of his incompetence,
the compensation and benefits due to Employee under this Agreement shall be paid
to his estate or legal representative, as the case may be, and any references to
this Agreement to Employee shall be deemed to refer, where appropriate, to
Employee's estate or other legal representative or to Employee's designated
beneficiary or beneficiaries.
17. CONSULTATION WITH COUNSEL. Employee acknowledges that he has
been advised to consult with legal counsel of his choice prior to execution and
delivery of this Agreement.
18. INTEGRATION. Except as otherwise specifically provided for, this
Agreement constitutes an integrated, written contract, expressing the entire
agreement between the Parties with respect to the subject matter hereof. In this
regard, Employee represents and warrants that he is not relying on any promises
or representations which do not appear written herein. Employee further
understands and agrees that this Agreement can be amended or modified only by a
written agreement, signed by all of the Parties hereto. In the event of any
inconsistency between the terms of this Agreement and the terms of any other
Company agreement, plan, policy or program, including, without limitation, any
employee manual or code of conduct, the terms of this Agreement shall control.
In the event there is a direct conflict between the terms of this Agreement and
the PIIN, the terms of this Agreement shall control.
19. COMPANY'S REPRESENTATIONS. The Company represents and
warrants that this Agreement has been fully and validly authorized by all
necessary corporate action.
20. COUNTERPARTS. This Agreement may be executed in separate
counterparts and by facsimile, and each such counterpart shall be deemed an
original with the same effect as if all Parties had signed the same document.
21. HEADINGS. The headings in each paragraph herein are for
convenience of reference only and shall be of no legal effect in the
interpretation of the terms hereof.
22. SEVERABILITY. If any provision in this Agreement is held to be
invalid, the remainder of this Agreement shall not be affected by such a
determination.
23. VOLUNTARY AGREEMENT. EMPLOYEE UNDERSTANDS AND AGREES THAT HE MAY
BE WAIVING SIGNIFICANT LEGAL RIGHTS BY SIGNING THIS AGREEMENT, AND REPRESENTS
THAT HE HAS ENTERED INTO THIS AGREEMENT KNOWINGLY AND VOLUNTARILY, WITH A FULL
UNDERSTANDING OF AND IN AGREEMENT WITH ALL OF ITS TERMS.
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement
on the dates provided below.
XXXXXXXX.XXX, INC.
By: /s/ Xxxx Xxxx
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Its: Xxxx Xxxx, Vice President and General
Counsel
XXXX XXXXXXX XXXXXX
/s/ Xxxx Xxxxxxx Xxxxxx
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