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EXHIBIT 10.18
June 23, 1998
Xxxxxx X. Xxxxxxxx
RomTech, Inc.
0000 Xxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxxxxxx 00000
Re: Separation Agreement and General Release
Dear Xxx:
This letter is to confirm the terms of your resignation as Chairman of the
Board and Chief Executive Officer of RomTech, Inc.
(the "Company").
In an effort to amicably resolve any issues relating to your employment
and its termination, the Company proposes the following agreement ("Agreement"),
which includes a general release:
1. In consideration for your general release and your fulfillment of the
various undertakings set forth in this Agreement, the Company, intending to be
legally bound, agrees as follows:
a. The Company will pay you your current base salary for a period of
12 months, commencing on the date of your execution of this agreement (the
"Severance Period"), at regular pay intervals and less taxes and other
deductions required by law to be withheld.
b. During the Severance Period, the Company will continue to provide
you with the same health insurance, disability insurance and life insurance that
the Company provided to you immediately prior to your termination. You will be
advised in a separate written communication of your right under COBRA to
continue the health insurance coverage beyond the Severance Period at your own
cost. Aside from the Company's health insurance, disability insurance and life
insurance plans, you are no longer eligible to participate in any other Company
benefit plans.
c. The Company has previously granted to you options to acquire a
total of 57,500 shares of the Company's Common Stock (the "Stock Options"). The
Company hereby agrees that you may exercise the Stock Options as such options
vest in accordance with their terms, and, notwithstanding the termination of
your
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employment with the Company, the Stock Options shall continue to be exercisable
for the remainder of respective terms.
2. In consideration for the Company's promises in paragraph 1 and
intending to be legally bound, you represent, warrant and agree as follows:
a. By your signature on this Agreement, you release and forever
discharge the Company and all of its affiliates and related entities, and the
past, present and future officers, directors, attorneys, employees, shareholders
and agents of each of the foregoing, as well as their respective heirs, legal
representatives, successors and assigns (collectively "Released Parties"),
jointly and severally, from any and all actions, charges, causes of action or
claims of any kind (collectively "claims"), known or unknown, which you, your
heirs, legal representatives, agents, or anyone claiming by or through you, ever
had, now have or hereafter may have against any of the Released Parties arising
out of any matter, occurrence or event existing or occurring prior to the date
you execute this Agreement, including, without limitation, the following: any
claims relating to or arising out of your employment with and/or termination of
employment by the Company; any claims for unpaid or withheld wages, severance,
benefits, bonuses, commissions and/or other compensation of any kind; any claim
that you are entitled to Company stock (except upon the exercise of the Stock
Options held by you on the date hereof and referred to in paragraph 1c hereof)
or stock options; any claims for attorneys' fees, costs or expenses; any claims
of discrimination based on age, sex, race, religion, color, creed, disability,
handicap, citizenship, national origin, sexual preference or any other factor
prohibited by law; and/or any other statutory or common law claims, now existing
or hereinafter recognized, including, but not limited to, breach of contract,
libel, slander, fraud, wrongful discharge, promissory estoppel, equitable
estoppel and misrepresentation. The general release provided for in this
paragraph 2a does not apply to any claims to enforce this Agreement, to any
claims to enforce your rights under the Stock Options or to any claim arising
out of any matter, occurrence or event occurring after your execution of this
Agreement.
b. You shall not disparage or deprecate the Company or its
affiliates or related entities or any of their officers, directors, employees,
shareholders or principals, or any of their operations, assets, services, work
product, character, motives or financial standing. Further, you agree to keep
the terms and conditions of this Agreement secret and confidential and not to
disclose them voluntarily to any third party, except to the extent required by
law, to enforce the Agreement or to obtain confidential legal, tax or financial
advice. You shall maintain the confidentiality of and not reveal to any third
parties any information, documents, plans, programs, policies or other material
of the Company which are confidential or secret to the Company or in which the
Company has a proprietary interest. In making this Agreement, you acknowledge
that any violation or breach of this commitment by you will cause immediate,
irreparable and substantial harm to the Company and that the Company will be
entitled to appropriate injunctive and other relief, including monetary damages,
against you in a court of competent jurisdiction.
c. You hereby voluntarily and irrevocably resign as a director of
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the Company and as Chairman of the Board of the Company.
d. You represent and warrant that you have returned to the Company
all memoranda, notes, records, reports, manuals, drawings and other documents
(and all copies thereof whether in written form or on computer disk or tape)
relating to the business of the Company and/or its affiliates and all property
associated therewith, which you possess or have under your control. Without
limiting the generality of the foregoing, you acknowledge that you have returned
to the Company all copies of all databases containing information about the
Company and/or its affiliates and related entities, regardless of whether such
information is in hard copy or stored electronically or on tape. You agree that
on and after the date of this letter you have not sought and will not seek to
access the information systems of the Company or its affiliates for any purpose
whatsoever.
e. Non-Competition.
(i) Until June 30, 1999, you shall not, unless acting with the
prior written consent of the board of directors of the Company, directly or
indirectly, own, manage, operate, join, control, finance or participate in the
ownership, management, operation, control or financing of, or be connected as an
officer, director, advisor, employee, partner, principal, agent, representative,
consultant or otherwise with or use or permit your name to be used in connection
with, any business or enterprise engaged in the Business (as hereinafter
defined). You recognize that the Business as engaged in by the Company is and
will continue to be international in scope, and that geographical limitations on
this non-competition covenant (and the non-solicitation covenant set forth in
paragraph f hereof) are therefore not appropriate. For purposes of this
Agreement, "Business" shall be defined as any business or enterprise engaged in
the design, development, manufacture, marketing, distribution or sale of any
software or Internet-based product which competes with any software or
Internet-based product sold or otherwise provided by the Company and/or any
subsidiary or affiliate of the Company.
(ii) The foregoing restriction shall not be construed to
prohibit your ownership of not more than 5% of any class of securities of any
corporation which is engaged in the Business having a class of securities
registered pursuant to the Securities Exchange Act of 1934 as amended (the
"Exchange Act"), provided that such ownership represents a passive investment
and that neither you nor any group of persons including yourself in any way,
either directly or indirectly, manages or exercises control of any such
corporation, guarantees any of its financial obligations, otherwise takes any
part in its business other than exercising your rights as a shareholder, or
seeks to do any of the foregoing.
f. No Solicitation. Until June 30, 1999, you shall not, either
directly or indirectly, (i) call on or solicit any person, firm, corporation or
other entity who or which at any time during the period from the date hereof to
June 30,
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1999 was a customer of the Company or any of its subsidiaries or affiliates with
respect to the activities prohibited by paragraph 2e hereof or (ii) solicit the
employment of any person who was employed by the Company or any of its
subsidiaries or affiliates on a full or part-time basis at anytime during the
period from the date hereof to June 30, 1999.
3. The Company's obligations under paragraph 1 above will cease if you:
(1) initiate an action against any of the Released Parties with respect to a
claim that has been released pursuant to paragraph 2a above; or (2) breach any
of the representations, warranties or agreements set forth in this Agreement.
4. You acknowledge and agree that the money and benefits you will receive
under paragraph 1 above exceed the money and benefits to which you otherwise
would be entitled, and that such excess is sufficient consideration to support
the grant of the general release in paragraphs 2a and 3 above and to support
your other undertakings set forth in this Agreement.
5. This Agreement sets forth our complete understanding and agreement and
supersedes all prior agreements between us, oral or written, express or implied.
6. This Agreement is being offered for the sole purpose of settling
amicably any and all possible disputes between us and assisting you in your
transition to a new job. This Agreement should not be construed as an admission
or concession of liability or wrongdoing by the Company or by you.
7. If any provision of this Agreement is deemed unlawful or unenforceable
by a court of competent jurisdiction, the remaining provisions shall continue in
full force and effect.
8. By your execution of this Agreement, your represent, warrant and agree
that:
a. You have read carefully the terms of this Agreement, including
the general release.
b. You have had an opportunity to and have been encouraged to review
this Agreement, including the general release, with an attorney.
c. You understand the meaning and effect of the terms of this
Agreement, including the general release.
d. You were given sufficient time to determine whether you wished to
enter into this Agreement, including the general release.
e. The entry into and execution of this Agreement, including the
general release, is your own free and voluntary act without compulsion of any
kind.
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f. No promise or inducement not expressed herein has been made to
you.
If you agree with the proposed terms as set forth above, please sign this
letter indicating your understanding and agreement and return it to me on or
before Thursday, June 25, 1998. The additional copy is for your records.
If I do not receive a signed copy of this letter by Thursday, June 25,
1998, I will assume that you have rejected this proposal. If this proposal is
rejected, your employment shall nevertheless be deemed to have terminated
effective on the date of this letter and this letter constitutes notice of such
termination.
We wish you the best in the future.
Sincerely,
RomTech, Inc.
UNDERSTOOD AND AGREED,
INTENDING TO BE LEGALLY BOUND: By: /s/ Xxxxxx X. Xxxxx
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Xxxxxx X. Xxxxx,
Vice President and
Chief Financial Officer
/s/ Xxxxxx X. Xxxxxxxx
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Xxxxxx X. Xxxxxxxx
Date: June 24, 1998
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Witness: /s/ Xxxxxxxx Xxxxxxx
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