SEPARATION AGREEMENT AND MUTUAL RELEASE
THIS SEPARATION AGREEMENT AND MUTUAL RELEASE (this "Agreement") is made and
entered into as of March 31, 1999, by and between KENETECH ENERGY SYSTEMS, INC.,
a Delaware corporation, KENETECH CORPORATION, a Delaware corporation, KES
PENUELAS HOLDINGS, INC., a Delaware corporation, KES LNG, LTD., a Delaware
corporation, KES PENUELAS, LTD., a Delaware corporation, KES PUERTO RICO, L.P.,
a Bermuda exempted limited partnership, KES BERMUDA, INC., a Delaware
corporation (collectively referred to as the "Company"), and XXXXX X. XXXXXX
(the 'Employee"), an individual currently employed by the Company.
RECITALS
The Company and the Employee entered into an Employment Agreement dated as of
the lst day of December, 1997 (the "Employment Agreement").
B. The Employee and the Company desire to mutually terminate the Employment
Agreement and the Employee's employment with the Company and to compromise,
settle and release fully and finally all outstanding matters between the
Employee and the Company, including all matters relating to the termination
of the Employment Agreement, the Employee's employment with the Company,
his separation from the Company and the termination of his employment with
the Company.
NOW, THEREFORE, in consideration of the premises and the mutual promises
contained herein, and for other good and valuable consideration, the Company and
the Employee agree as follows:
Separation Date. The Company and the Employee have agreed that the Employment
Agreement and the Employee's employment with the Company shall terminate
effective at the close of business on March 31, 1999 (the "Separation Date").
The Employee understands and agrees that, effective as of the Separation Date,
he is no longer authorized to incur any expenses, obligations or liabilities on
behalf of the Company and he has submitted or will submit for reimbursement,
with appropriate supporting documentation, all outstanding expenses incurred by
him prior to such date. Notwithstanding the preceding sentence, to the extent
the Employee has not yet received invoices, receipts or other evidence of
expenses incurred by the Employee on behalf of the Company on or prior to the
Separation Date, the Employee shall be reimbursed for such expenses incurred in
the ordinary course, if appropriate supporting documentation is submitted to the
Company within 45 days of the Separation Date.
2. Resignation. The execution of this Agreement shall confirm the Employee's
resignation as an officer and employee of the Company effective as of the
Separation Date.
Terms of Separation. In consideration of the agreements by the Employee provided
herein, including, without limitation, the release by the Employee in Section 4
below, the Company agrees as follows:
(a) In full satisfaction of any claims by the Employee in connection with his
employment or the termination of the Employment Agreement or his
employment, including, but not limited to, any claims for compensation,
bonuses, retention payments, severance payments, fringe benefits, change in
control benefits, options, out-placement services or any other payments
payable under the Employment Agreement or otherwise, the Company shall pay
to the Employee, on or prior to the Separation Date, a lump sum amount
equal to $194,099.36. The Employee shall also receive, prior to the
Separation Date, payment of all accrued vacation. Upon receipt of such
accrued vacation pay and any bi-weekly salary payments for the month of
March, 1999 not previously paid to the Employee, the Employee acknowledges
that he has received his full salary, vacation pay and benefits from the
Company in accordance with the Company's regular payroll practices.
(b) The Company shall deduct and withhold, from the compensation payable to the
Employee under this Agreement, any and all Federal, State and local income
and employment withholding taxes and any other amounts required to be
deducted or withheld by the Company under any applicable statute or
regulation.
(c) The Employee shall cease participation in all employee benefit plans of the
Company effective as of the Separation Date, and the Company thereafter
shall not be liable for any payments on behalf of the Employee in respect
of any fringe benefits provided by the Company. Notwithstanding the
preceding sentence, to the extent that the Employee has incurred claims for
health care expenses on or prior to the Separation Date and such claims are
submitted to the Company within 45 days of the Separation Date, the
Employee shall be reimbursed for such claims in the ordinary course by the
Company pursuant to the terms and conditions of the Company's employee
benefit plan.
4. Mutual Releases.
(a) Release By the Employee. Except as to any claims arising out of rights
provided under this Agreement, in consideration of the agreements set forth
herein, the Employee hereby irrevocably and unconditionally releases,
acquits and forever discharges the Company and any related entity and their
stockholders, predecessors, successors, assigns, agents, directors,
officers, employees, representatives, attorneys, divisions, and
subsidiaries, and all persons acting by, through, under or in concert with
any of them (collectively, the "Company Releasees"), or any of them, from
any and all charges, complaints, claims, assertions of claims, liabilities,
obligations, promises, agreements, controversies, damages, actions, causes
of action, suits, rights, demands, costs, losses, debts and expenses
(including attorneys' fees and costs actually incurred) of any nature
whatsoever, whether known or unknown, suspected or unsuspected, arising
directly or indirectly out of the Employment Agreement, the Employee's
employment with the Company, his separation from employment with the
Company or the termination of his employment with the Company, which the
Employee or his heirs, executors, administrators, agents, successors or
assigns, now has, or ever claimed to have, or could claim against each or
any of the Company Releasees, from the beginning of time to the present,
including, without limitation, any of the following: claims for workers'
compensation, claims in equity or law for wrongful discharge, personal
injury claims, claims under federal, state or local laws prohibiting
discrimination on account of age, national origin, race, sex, disability,
religion and other protected classifications, or claims under the Civil
Rights Acts of 1866 and 1871, as amended, Title VII of the Civil Rights Act
of 1964, as amended, the Civil Rights Act of 1991, the Age Discrimination
in Employment Act of 1967, as amended, the Employee Retirement Income
Security Act of 1974, as amended, the Americans with Disabilities Act of
1990, the Family Medical and Leave Act, and the California Fair Employment
and Housing Act or any comparable law of any other State (collectively, the
"Employee Claims"). The Employee hereby agrees to forego any right to file
any charges or complaints with any governmental agencies or any legal
action against the Company Releasees under any of the laws referenced in
this subparagraph or with respect to any of the Employee Claims.
Notwithstanding the foregoing, the release by the Employee in this
subparagraph shall not limit the right of the Employee to seek to enforce
the provisions of this Agreement.
(b) Release By The Company. Except as to any claims arising out of rights
provided under this Agreement, in consideration for the agreements set
forth herein, the Company hereby irrevocably and unconditionally releases,
acquits and forever discharges for itself and its agents, successors and
assigns, the Employee and his successors and assigns (collectively, the
"Employee Releasees"), or any of them, from any and all charges,
complaints, claims, assertions of claims, liabilities, obligations,
promises, agreements, controversies, damages, actions, causes of action,
suits, rights, demands, costs, losses, debts and expenses (including
attorneys' fees and costs actually incurred) of any nature whatsoever,
known or unknown, suspected or unsuspected, arising directly or indirectly
out of the Employee's employment with the Company, his separation from
employment with the Company or the termination of his employment with the
Company, which the Company now has, or ever claimed to have, or could claim
against each or any of the Employee Releasees. The Company hereby agrees to
forego any right to file any charges or complaints with any governmental
agencies or any legal action against the Employee Releasees under any of
the laws referenced in this paragraph or with respect to any of the
foregoing claims. Notwithstanding the foregoing, the release by the Company
in this subparagraph shall not limit the right of the Company to seek to
enforce the provisions of this Agreement.
5. Waiver of Unknown Claims. The Company and the Employee acknowledge that
they are aware that they may hereafter discover claims or facts different
from or in addition to those they now know or believe to be true with
respect to the matters herein released, and except as to any claims arising
out of the rights provided under this Agreement, they agree that the mutual
releases set forth above shall be and remain in effect in all respects a
complete general release as to the matters released and all claims relative
thereto which may exist or may heretofore have existed, notwithstanding any
such different or additional facts. The Company and the Employee
acknowledge that they have considered the possibility that they may not
fully know the number or magnitude of all of the claims which they have or
may have against each other and the Releasees of the other party and intend
to assume the risk that they are releasing unknown claims. The Company and
the Employee acknowledge that they have been informed of Section 1542 of
the Civil Code of the State of California and, except as set forth in this
Agreement, they do hereby expressly waive and relinquish all rights and
benefits which they have or may have under such Section, which reads as
follows:
"A general release does not extend to claims which the creditor does
not know or suspect to exist in his favor at the time of executing the
release, which if known by him must have materially affected his
settlement with the debtor."
The Company and the Employee understand and acknowledge the
significance and consequences of such specific waiver of Section 1542 and,
except as set forth in this Agreement, hereby assume full responsibility
for any injuries, damages or losses that they may incur as the result of
such waiver.
6. Indemnification and Insurance. To the extent permitted by applicable law,
the Company agrees that all rights to indemnification from the Company
existing under the law and under the Company's certificate of incorporation
and by-laws as of the date hereof, in favor of the Employee as an officer,
employee, or agent of the Company shall survive this Agreement and shall
continue in full force and effect with respect to any liability for any
acts or omissions by the Employee during the period of his employment by
the Company. The Company further agrees that, for so long as it maintains
directors' and officers' liability insurance that covers any employees of
the Company, it shall include the Employee among the insured employees;
provided, however, that this Agreement shall not be construed or implied as
an obligation to continue to maintain directors' and officers' liability
insurance for active or former employees for any period of time.
7. Confidentiality and Non-Disclosure Agreements.
(a) The Employee acknowledges that any confidentiality, proprietary or
ownership rights or nondisclosure agreement(s) in favor of the Company or
the Company Releasees which he may have entered into in connection with his
employment (the "Nondisclosure Agreement(s)") by the Company, are
understood to survive, and do survive, the termination of his employment
and this Agreement, and accordingly nothing in this Agreement shall be
construed as terminating, limiting or otherwise affecting any such
Nondisclosure Agreement(s) or the Employee's obligations thereunder.
(b) The Employee agrees that, except to the extent compelled by law or legal
process or except to the extent he is required to disclose to governmental
authorities in connection with any inquiry, audit or assessment relating to
the taxation of any payments provided for herein or except in any
litigation or arbitration proceeding between the Company and the Employee
(in which case the Employee will use his best efforts to ensure that such
information is maintained as confidential by the persons to whom he is
compelled or required to disclose such information), the Employee will not:
(i) disclose or communicate confidential information of the Company to any
third party (including governmental agencies and employees and former
employees of the Company); (ii) make use of confidential information of the
Company for his own behalf, or on behalf of any third party; or (iii)
facilitate, assist, persuade or attempt to facilitate, assist or persuade
any third party to commence or prosecute any legal proceedings against the
Company or any Company Releasees. If the Employee receives, is notified of,
or is served with a subpoena, summons, complaint, order, notice, notice of
deposition or any other legal process or request for information in
connection with any legal or quasi-legal proceeding, including, but not
limited to, any action at law or equity, arbitration, administrative
proceeding or governmental, self-regulating organization or stock exchange
investigation, relating to the performance of his services as an employee,
officer or as a director of the Company, or which, if complied with by the
Employee, might compel or lead to the disclosure by the Employee of
confidential information of the Company, the Employee shall immediately
notify the Company and provide the Company with a copy of the same within
two business days.
8. Company Property and Information. The Company and the Employee agree that
the Employee, as of the Separation Date, has returned or will return to the
Company all Company Information (defined below) and files containing
Company Information; credit cards; cardkey passes; door and file keys;
automobiles; computer access codes, computer discs, magnetic media;
software; and all other physical property which the Employee received in
connection with his employment. The term "Company Information" as used in
this Agreement means confidential or proprietary business or financial
information of the Company. The Employee further represents and warrants
that he has not, except in the ordinary course of business and in
accordance with Company policies and procedures, destroyed or discarded any
documents or information.
9. Disclosure of this Agreement.
(a) The Company will file with the Securities and Exchange Commission a current
report on Form 10-K disclosing the Employee's resignation and may make such
other disclosure as required or appropriate under applicable laws and
regulations.
(b) The Company agrees that it shall respond to all inquiries concerning the
Employee's employment by the Company, including inquiries by prospective
employers, by confirming the dates of the Employee's employment and the
positions he held.
10. Consideration. The Company and the Employee mutually acknowledge that
neither is required to enter into this Agreement, and the Employee
acknowledges that the consideration to be received by him under this
Agreement is adequate and that the promises and agreements made by the
Company in this Agreement are in consideration of the Employee's agreement
to provide the releases set forth in Section 4 above.
11. Voluntary Agreement. The Employee represents and agrees that he has been
advised by the Company of his right to discuss all aspects of this
Agreement with his attorneys, that he has voluntarily chosen not to avail
himself of this right, that he has carefully read and fully understands all
of the provisions of this Agreement, and that he is voluntarily entering
into this Agreement.
12. General Provisions.
(a) The Employee represents and acknowledges that in executing this
Agreement, he does not rely and has not relied upon any
representation, inducement, agreement or statement not set forth
herein made by any of the Company Releasees or by any of the Company
Releasees' agents, representatives or attorneys with regard to the
subject matter of this Agreement or otherwise.
(b) The provisions of this Agreement are severable, and if any part of it
is found to be unenforceable, the other provisions shall remain fully
valid and enforceable. This Agreement shall survive the termination of
any arrangements contained herein.
(c) The Company and the Employee mutually agree that neither may assign
this Agreement, or any rights or obligations under this Agreement, to
any person or entity without the express prior written approval of the
other.
(d) This Agreement sets forth the entire agreement between the Company and
the Employee and supersedes any and all prior agreements or
understandings between the Company and the Employee pertaining to the
subject matter hereof including, without limitation, the Employment
Agreement. The Employment Agreement shall be null and void and of no
further effect as of the Separation Date. This Agreement shall inure
to the benefit of and be binding upon the successors in interest and
assigns of each party except as otherwise provided herein.
(e) The effect, intent and construction of this Agreement shall be
governed by the laws of the State of California, without giving effect
to the conflict of laws rules thereof.
(f) This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be an original.
IN WITNESS WHEREOF, the Company and the Employee have duly executed this
Agreement as of the date first set forth above.
KENETECH ENERGY SYSTEMS, INC.
By_________________________ ___________________________
Name: Xxxx X. Xxxxxx XXXXX X. XXXXXX
Title: Vice President and Assistant Secretary
KENETECH CORPORATION
By_________________________
Name: Xxxx X. Xxxxxx
Title: President and CEO
KES PENUELAS HOLDINGS, INC.
By_________________________
Name: Xxxx X. Xxxxxx
Title: Vice President and Assistant Secretary
KES LNG, LTD.
By_________________________
Name: Xxxx X. Xxxxxx
Title: Vice President and Assistant Secretary
KES PENUELAS, LTD.
By_________________________
Name: Xxxx X. Xxxxxx
Title: Vice President and Assistant Secretary
KES BERMUDA, INC.
By_________________________
Name: Xxxx X. Xxxxxx
Title: Vice President and Assistant Secretary
KES PUERTO RICO, L.P.
By KES LNG, Ltd., its general partner
By_________________________
Name: Xxxx X. Xxxxxx
Title: Vice President and Assistant Secretary
