EXHIBIT 10.25
SEPARATION AGREEMENT AND GENERAL RELEASE
This Separation Agreement and General Release ("Agreement") is made
as of May 26, 2005, between Alfacell Corporation, a Delaware corporation, with
offices in Bloomfield, New Jersey ("Alfacell" or the "Company"), and Xxxxxx X.
Xxxxxxxxx ("Executive"), a resident of New Jersey.
BACKGROUND
A. Executive is an Alfacell employee who is being terminated without
cause from his employment with Alfacell effective May 20, 2005 and Executive
understands that in connection with Alfacell's next annual meeting of its
stockholders the board of directors is not under any obligation to re-nominate
Executive for election as a director of Alfacell; and
B. Alfacell desires to recognize Executive's material contributions
during his employment;
C. Executive and Alfacell wish to set forth the compensation payable
to Executive upon the termination of his employment as the Company's Senior Vice
President, and Chief Financial Officer; and
D. Executive and Alfacell desire to resolve any potential claims or
disputes arising from Executive's employment with Alfacell or his voluntary
resignation from employment.
TERMS
In consideration of the mutual covenants and undertakings contained
herein, Executive and Alfacell agree as follows:
1. Executive is hereby terminated without cause from his employment
with Alfacell and from his positions as Senior Vice President and Chief
Financial Officer effective May 20, 2005 (the "Separation Date"). Executive
understands that in connection with Alfacell's next annual meeting of its
stockholders the board of directors is not under any obligation to re-nominate
Executive for election as a director of Alfacell and that between the Separation
Date and the date of Alfacell's next annual meeting the Executive will not
receive any compensation in connection with his service as a director of
Alfacell.
2. Alfacell agrees to pay Executive's regular salary and benefits
through the Separation Date, subject to the withholding of all federal, state,
city or other taxes as shall be required pursuant to any law or governmental
regulation or ruling.
3. Alfacell agrees to pay Executive a cash payment of $15,000 which
is the equivalent of one month of Executive's base salary as of the Separation
Date subject to the withholding of all federal, state, city or other taxes as
shall be required pursuant to any law or governmental regulation or ruling and
such payment shall be made in a lump sum within 10 business days after the end
of the Rescission Period (as defined in Paragraph 16 below) without revocation
by Executive.
4. Alfacell agrees to pay Executive a cash payment of $6,923.08
which is to cover the two weeks of Executive's accrued but not taken vacation as
of the Separation Date subject to the withholding of all federal, state, city or
other taxes as shall be required pursuant to any law or governmental regulation
or ruling and such payment shall be made in a lump sum within 10 business days
after the end of the Rescission Period without revocation by Executive.
5. Executive's eligibility for any other Alfacell benefits of any
kind will end effective as of the Separation Date.
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6. To the extent any of the stock options to purchase Alfacell
common stock granted to Executive pursuant to the 1997 Stock Option Plan (the
"1997 Plan") or the 2004 Stock Option Plan Incentive Stock Plan (the "2004 Plan"
and collectively with the 1997 Plan the "Stock Plans") that have not vested as
of the Separation Date, they will be extinguished and of no further force or
effect as of the Separation Date. The options to purchase 137,500 shares of
Alfacell common stock granted to Executive pursuant to the 2004 Stock Plan that
have vested as of the Separation Date, as described on Exhibit B attached
hereto, shall remain exercisable until the close of business on May 20, 2006.
The options to purchase 13,750 shares of Alfacell common stock granted to the
Executive while he was an Independent Director pursuant to the 1997 Plan as
described on Exhibit B, shall be governed subject to the terms of the 1997 Plan
which shall be no less than 190 days to exercise from the date the Executive
ceases to be a member of the Board of Directors of Alfacell.
7. Alfacell will not contest any claim for unemployment benefits.
Alfacell will be entitled to respond to any inquiries from any state agency
seeking information in connection with the payment of any unemployment benefits,
and will reflect that the Executive was terminated due to a change in
management.
8. Executive agrees that no additional compensation or benefits of
any kind shall be paid to him, and the compensation and benefits provided to him
under this Agreement shall be in full payment and satisfaction of any and all
financial obligations due to him from Alfacell.
9. It is understood and agreed that, by this Agreement, Executive
and Alfacell intend to settle any and all claims which Executive or Alfacell has
or may have against the other arising out of or resulting from Executive's
employment at Alfacell and his resignation from such employment or this
Agreement. Accordingly, in exchange for the benefits provided to Executive by
this Agreement, Executive, for himself, his heirs, successors and assigns (the
"Executive Releasees"), hereby voluntarily discharges and releases Alfacell and
its affiliates, parent and subsidiary companies, and their respective officers,
directors, employees, agents, representatives, successors and assigns (the
"Alfacell Releasees") from any and all claims or liabilities of any kind or
description, known or unknown, suspected or unsuspected, fixed or contingent,
which Executive ever had, now has or hereafter may have against each or any of
the Alfacell Releasees by reason of any matter or event whatsoever occurring
prior to the date of this Agreement, including but not limited to any claims
arising out of or resulting from Executive's employment at Alfacell or his
separation from such employment or this Agreement. The release of claims
specifically includes, but is not limited to, claims arising under or based
upon, the Age Discrimination in Employment Act, the Older Workers Benefit
Protection Act, Title VII of the Civil Rights Act of 1964, the Civil Rights Act
of 1991, the Family and Medical Leave Act of 1993, the Employee Retirement
Income Security Act, the Rehabilitation Act of 1973, the Americans with
Disabilities Act of 1990, the New Jersey Law Against Discrimination, the New
Jersey Family Leave Act, the New Jersey Conscientious Employee Protection Act,
the Fair Labor Standards Act, the New Jersey Wage and Hour Act, and/or any other
state, federal, or municipal employment discrimination statutes (including but
not limited to claims based on age, sex, attainment of benefit plan rights,
race, national origin, religion, handicap, sexual orientation, sexual
harassment, family or marital status, retaliation, and veteran status), and/or
any other federal, state, or local statute, law, ordinance, or regulation and/or
pursuant to any other theory whatsoever, including but not limited to claims
related to breach of implied or express employment contracts, breach of the
implied covenant of good faith and fair dealing, defamation, wrongful discharge,
constructive discharge, negligence of any kind, intentional infliction of
emotional distress, whistle-blowing, fraud, estoppel or detrimental reliance,
public policy, constitutional or tort claims, violation of the penal statutes
and common law claims, or pursuant to any other theory or claim whatsoever,
including claims for attorneys' fees, arising out of or related to Executive's
employment at Alfacell or his resignation from such employment or this Agreement
or any other occurrence from the beginning of time to the date of this
Agreement. Alfacell, for itself and the Alfacell Releasees, hereby voluntarily
discharges and releases Executive and the Executive Releasees from any and all
claims or liabilities of any kind or description, known or unknown, suspected or
unsuspected, fixed or contingent, which Alfacell ever had, now has or hereafter
may have against Executive and each or any of the Executive Releasees by reason
of any matter whatsoever arising out of or resulting from Executive's employment
at Alfacell or his separation from such employment or this Agreement.
10. Each party agrees to reasonably cooperate with the other with
respect to transition matters. With respect to Executive, this will include but
not be limited to: (a) responding to reasonable telephonic inquiries
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from Alfacell management concerning the transition of matters that Executive
worked on during his employ and (b) promptly notifying within a reasonable time
Alfacell's Chief Executive Officer, or her successor or designee, if Executive
receives any legal notices, subpoenaes or requests for information from any
person or entity, other than a representative of Alfacell, concerning matters
which arose during the period of his employment with Alfacell.
11. Each party agrees not to directly or indirectly make any
disparaging, untrue, or defamatory statements or communications (regardless of
medium) about the other. In the case of the Company, the preceding sentence
shall be limited to those statements properly made on behalf of the Company and
to those statements made directly or indirectly by any of its directors or
executive officers. In the event of a violation of this Section 11, the
non-violating party may seek injunctive relief in addition to other damages. If
any prospective future employer contacts Alfacell concerning the Executive,
Alfacell shall confirm the Executive's job title, compensation and dates of
employment at Alfacell, and will not provide any other information concerning
the Executive.
12. Both parties agree that they will keep the specific terms of
this Agreement strictly confidential with the sole exceptions of Executive's
spouse, either party's attorney(s) or tax advisor(s), Alfacell's independent
auditors (all of whom agree to keep the terms confidential), or as may be
required by law including disclosure requirements under applicable securities
laws or as necessary in any legal proceeding to enforce or prosecute a party's
rights.
13. Executive acknowledges and agrees that his Employee's
Confidentiality Agreement shall remain in full force and effect according to its
terms. Notwithstanding any other provision of this agreement, the Executive
acknowledges his duty to maintain the confidentiality of any information or
communication subject to attorney client privilege or any client secrets which
he learned of in the course of his service as the Company's Senior Vice
President and Chief Financial Officer.
14. Executive agrees that, no later than May 31, 2005, he shall
deliver to Alfacell all books, records, notes, documents and other written or
computer generated materials of any nature whatsoever relating to Alfacell's
business and any other Alfacell property in his possession or within his control
(e.g., credit cards, equipment, office keys). Executive agrees that he shall not
keep in his possession or control any of Alfacell's property of any kind.
15. Both parties acknowledge and represent that they fully
understand this Agreement, that they have had adequate and reasonable
opportunity to review the Agreement, that they were advised to consult with
independent counsel of their choice before signing it, and that they are signing
it voluntarily.
16. Executive acknowledges that the terms of this Agreement shall be
open for acceptance by him for a period of twenty-one (21) days during which
time he may consider whether to accept this Agreement.
17. Executive further acknowledges and agrees that he may cancel or
revoke this Agreement within seven (7) days after signing it (the "Rescission
Period"). To be effective, any notice of cancellation or revocation must be in
writing and delivered either by hand or mail prior to the end of the Rescission
Period to Ms. Kuslima Shogen at Alfacell. If delivered by mail, the notice of
cancellation or revocation must be (a) post-marked prior to the end of the
Rescission Period; (b) properly addressed to Ms. Kuslima Shogen, Alfacell
Corporation, 000 Xxxxxxxxxx Xxxxxx, Xxxxxxxxxx, XX 00000; and (c) sent by
certified mail, return receipt requested. Executive acknowledges and agrees that
if he exercises his right of cancellation or revocation, Alfacell shall be
relieved of all obligations undertaken in this Agreement, including, without
limitation, any payments hereunder.
18. The terms and conditions of this Agreement may not be altered,
amended or modified except by a writing duly executed by both Executive and
Alfacell.
19. Except as otherwise stated herein, this Agreement contains the
entire understanding between Executive and Alfacell with respect to the
termination of Executive's employment at Alfacell. There are no covenants,
representations or undertakings with respect to such termination other than
those expressly set forth or referenced in this Agreement.
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20. If any portion of this Agreement is found by a court of
competent jurisdiction to be void and unenforceable, such portions shall be
deemed to be severable from the Agreement and shall have no effect on the
remaining sections of this Agreement.
21. This Agreement shall be governed and construed in accordance
with the laws of the State of New Jersey without regard to its choice of law or
conflicts of law rules. In the event of any proceedings arising out of this
Agreement, the prevailing party shall be entitled to reasonable attorneys fees
and costs.
22. This Agreement has been reviewed and negotiated by both
Executive and Alfacell, and no provision of this Agreement shall be construed
against either party on the ground that such party was the drafter of that
provision or the Agreement.
23. This Agreement shall be binding upon Executive and Alfacell upon
its execution by them and shall inure to the benefit of their respective heirs,
successors and permitted assigns.
IN WITNESS WHEREOF, the parties have duly executed this Separation
Agreement and General Release or caused it to be executed by duly authorized
representatives as of the dates set forth below.
ALFACELL CORPORATION
By: /s/ Kuslima Shogen By: /s/ Xxxxxx X. Xxxxxxxxx
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Name: Kuslima Shogen Xxxxxx X. Xxxxxxxxx
Title: Chief Executive Officer
Date: June 3, 2005 Date: June 7, 2005
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EXHIBIT B
VESTED OPTIONS
(as of the Separation Date)
Pursuant to the 2004 Plan
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Shares Exercise Price Vest Date
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50,000 $4.75 6/04/2004
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87,500 $4.75 3/04/2005
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Pursuant to the 1997 Plan
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Shares Exercise Price Vest Date
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13,750 $3.74 12/30/2004
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