SEPARATION AND GENERAL RELEASE AGREEMENT
Exhibit 10.4
EXECUTION COPY
This Separation and General Release Agreement (this “Agreement”) is being entered into
as of this 24th day of August, 2010, by and between Biolase Technology, Inc. (the
“Company”), and Xxxxx X. Xxxxxx, an individual (“Employee”) (each of the Company
and Employee is sometimes hereinafter referred to individually, as a “Party” and
collectively, as the “Parties”).
WHEREAS, Employee and the Company are parties to that certain Employment Agreement, dated as
of April 29, 2008, as amended (the “Employment Agreement”).
WHEREAS, the Parties wish to provide for severance benefits in lieu of any severance benefits
provided under the Employment Agreement on the terms and conditions set forth below.
WHEREFORE in consideration of the foregoing premises and the terms and conditions set forth
below, the Parties agree as follows:
1. Termination of Employment.
a. The Company has terminated Employee’s employment, effective as of August 24,
2010 (the “Effective Date”). The Company terminated Employee from his positions as the
Chief Executive Officer and President, effective as of the Effective Date. Employee hereby
acknowledges receipt of the Company’s notice of termination, and resigns as a member of the Board
of Directors of the Company, and from each position as a director, officer and/or employee of the
Company or any subsidiary or affiliate of the Company, effective as of the Effective Date.
b. Employee acknowledges that he has been paid the gross amount of $24,999.03,
which constitutes all salary and wages through and including the Effective Date, including without
limitation, and any accrued unused vacation benefits, less applicable tax and other withholding,
and Employee has been fully reimbursed for all of Employee’s business expenses. Except as
otherwise provided for in this Agreement, the rights and obligations of Employee and the Company
under the Employment Agreement terminated on the Effective Date and shall have no further force or
effect after the Effective Date.
c. Provided that within twenty-one days of the date on which Employee receives this
Agreement, Employee executes and delivers to the Company the Termination Certification attached
hereto as Exhibit A and the Mutual Release and Waiver of Claims (the “Release”)
attached hereto as Exhibit B, and further provided that Employee does not revoke the
Release in accordance with its terms and conditions, the Company shall provide to Employee, in lieu
of any compensation or benefits under the Employment Agreement, the following severance benefits:
(1) The Company shall pay to Employee $10,416.67, subject to applicable tax
withholding, payable in one installment(s) the next day following the expiration of the Release
revocation period described above. The Company shall pay such amount as wages, and report such
amount as wages paid on each payment date and shall remit the amount of the required tax
withholding to the relevant tax authorities.
(2) The Company shall pay COBRA premiums for Employee (and his eligible dependents) under the
Company’s medical and dental benefit plans, as in effect from time to time, for the six (6) month
period following the Effective Date. The benefits under such plans shall be provided through
insurance maintained by the Company.
(3) To the extent that it is permissible by law and in compliance with all plan rules, the
Company shall pay Employee’s premiums under the Company’s group life insurance, accidental death
and dismemberment and disability benefit plans during the six (6) month period following the
Effective Date. The benefits under such plans shall be provided through insurance maintained by the
Company.
d. Except as provided for in this Agreement, Employee understands and agrees that
he is giving up any right or claim to further compensation from the Company. Employee and the
Company have no further rights or obligations under the Employment Agreement, except as otherwise
specified in this Agreement.
2. No Admission. Employee and the Company further understand and agree that neither
the payment of money nor the execution of this Agreement, including the Release, shall constitute
or be construed as an admission of any liability whatsoever by either Party.
3. Severability. The provisions of this Agreement are severable, and if any part of
this Agreement is found to be unenforceable, the other paragraphs (or portions thereof) shall
remain fully valid and enforceable.
4. No Encouragement of Actions/Cooperation with the Company/Press Release. Employee
agrees that he will not assist any person or entity in bringing or pursuing legal action against
the Company, its agents, successors, representatives, employees and related and/or affiliated
companies, based on events occurring prior to the Effective Date; provided,
however, that this Section 4 shall not apply to any legal action arising from or related to
this Agreement or to any conduct compelled by or pursuant to applicable law, nor shall it prohibit,
in any way, Employee from responding to a subpoena or taking any other action required by law. To
the extent Employee is subpoenaed or otherwise requested or required to provide any documents,
testimony or other information concerning the Company, he shall notify the Company as soon as
practicable, and reasonably cooperate with the Company in opposing any such request or requirement
to the extent permitted by applicable law. Employee shall also provide information requested by
the Company, and make himself available at reasonable times upon reasonable request to assist the
Company in defending or prosecuting any legal action or arbitration to the extent it concerns
events occurring during his employment or events as to which he may have knowledge. The Company
shall reimburse Employee for any reasonable out of pocket expenses incurred and shall compensate
Employee for Employee’s actual time spent, including travel time, providing information or
assistance to the Company, under the immediately preceding sentence, at the rate of $250.00 per
hour. The Company shall issue, on the date hereof, the Press Release attached hereto as
Exhibit C.
2
5. No Disparagement. The Company and Employee agree that for a period of ten (10)
years after Employee’s employment with the Company ceases, they will not, in any communication
with any person or entity, including any actual or potential customer, client, investor, vendor,
distributor, or business partner of the Company, or any third party media outlet, make any
derogatory or disparaging or critical negative statements — orally, written or otherwise — against
the other, or against the Employee’s affiliates, or any of the Company’s directors, officers, or
agents (in the case of any of Employee’s affiliates, at such time as they are affiliated with
Employee or, in the case of any of the Company’s directors, officers or agents, at such time as
they are employed by, or acting for, the Company). The parties acknowledge and agree that the
obligation on the part of the Company not to make any derogatory statements as set forth in this
paragraph shall only apply to the Company’s officers and directors.
6. Company Property. Employee agrees to search Employee’s home, office and all other
storage areas for all property owned by the Company and to return or destroy and/or delete any
located Company property and equipment to the Company within five (5) days of Employee’s execution
of this Agreement. In the event Employee discovers Company property or equipment in his possession
after such time, Employee shall deliver such materials to the Company immediately upon discovery.
7. Choice of Law and Venue. The Parties acknowledge and agree that this Agreement
shall be interpreted in accordance with California law. If any claims or actions arising out of or
relating to this Agreement or Employee’s service with the Company are determined by an arbitrator
not to be subject to Section 9, they shall be filed in either the Superior Court of the State of
California for the County of Orange, or the Federal District Court for the Central District of
California.
8. Sole and Entire Agreement; Obligations of Employee. With the exception of the
terms and conditions of the Release, the Proprietary Information Agreement, and the
non-solicitation provisions set forth in Section 6 of the Employment Agreement, this Agreement and
the exhibits hereto represent the sole and entire agreement among the Parties and supersedes all
prior agreements (including, without limitation, the Employment Agreement), negotiations, and
discussions between the Parties hereto and/or their respective counsel. The non-solicitation
provisions of Section 6 of the Employment Agreement shall remain in full force and effect and shall
survive the termination of Employee’s employment with the Company and the termination of the
Employment Agreement, and Employee acknowledges and agrees that the Company shall have the right to
communicate with any future or prospective employer of Employee concerning Employee’s obligations
under this Agreement, the Proprietary Information Agreement, and the non-solicitation provisions of
Section 6 of the Employment Agreement. Employee is not relying on any promise or representation by
the Company that is not expressly stated herein and the Company is not relying on any promise or
representation by Employee that is not expressly stated herein. Any agreement amending or
superseding this Agreement must be in writing, signed by duly authorized representatives of the
Parties, specifically reference this Agreement; and state the intent of the Parties to amend or
supersede this Agreement. This Agreement may only be modified by a writing signed by both Employee
and a duly authorized officer of the Company. In the event the Company fails to provide Employee
with the severance benefits set forth in Section 1(c) above, Employee shall have the right to cease
performance under this Agreement (but only if the Company does not cure after the expiration of the
cure period below
and provided that Employee has not otherwise breached this Agreement) by sending two separate
written notices to the Company, to the Company’s principal headquarters and one to the attention of
the Company’s Chief Executive Officer and the other to the Chairman of the Board, and the Company
may cure such failure within thirty (30) business days of receipt such notice(s). If the Company
fails to cure such failure within the thirty (30) business day time period, the Release shall be
deemed unenforceable by the Company.
3
9. Arbitration. The Parties hereby agree to submit any claim or dispute arising out
of or relating to the terms of this Agreement to private and confidential arbitration by a single
neutral arbitrator. Subject to the terms of this Section, the arbitration proceedings shall be
governed by the rules of the Judicial Arbitration and Mediation Service (“JAMS”) applicable
to employment disputes as they may be in effect from time to time, and shall take place in Orange
County, California. The arbitrator shall be appointed by agreement of the Parties hereto or, if no
agreement can be reached, by the JAMS pursuant to its rules. The Arbitrator shall have
jurisdiction to hear and rule on pre-hearing disputes and is authorized to hold pre-hearing
conferences by telephone or in person, as the Arbitrator deems necessary. The Arbitrator shall have
the authority to entertain a motion to dismiss, demurrer, and/or a motion for summary judgment by
any party and shall apply the standards governing such motions under the federal rules of civil
procedure applicable in the location of the arbitration. The decision of the arbitrator shall be
rendered in writing and be final and binding on all Parties to this Agreement, and judgment thereon
may be entered in any court having jurisdiction. Either party may bring an action in any court of
competent jurisdiction to compel arbitration under this Agreement and/or to enforce an arbitration
award. The arbitrator’s fees and/or any other fees payable to JAMS shall be shared in accordance
with the rules of JAMS; provided, however, that Employee shall not be required to pay any such fees
that are unique to arbitration and/or would exceed the cost of filing the same claim(s) in a court
of competent jurisdiction, and any shortfall shall be borne by the Company. The Parties shall each
bear their own attorneys’ fees, witness expenses, expert fees and other costs, except to the extent
they may be awarded otherwise by the arbitrator in accordance with applicable law. This
arbitration procedure is intended to be the sole and exclusive method of resolving any claim
between the Parties, and each of the Parties hereby waives any right to a jury trial with respect
to such claims. The successful or prevailing party in any arbitration or other legal proceeding
concerning this Agreement shall be entitled to attorneys’ fees and other costs incurred in that
action or proceeding, in addition to any other relief to which such party may be entitled or
awarded. Notwithstanding the foregoing provisions of this paragraph, either party may seek
temporary or preliminary injunction relief in any court of competent jurisdiction if such relief is
unavailable or cannot be timely obtained through Arbitration.
10. Headings; Construction of Agreement. The headings in this Agreement are provided
solely for the Parties’ convenience, and are not intended to be part of, nor to affect or alter the
interpretation or meaning of this Agreement. Both Parties have been represented by, or had the
opportunity to be represented by, counsel in connection with this Agreement.
11. Counterparts. For the convenience of the Parties hereto, this Agreement may be
executed in any number of counterparts, each such counterpart being deemed to be an original
instrument, and all such counterparts shall together constitute the same agreement.
4
12. Authority to Execute this Agreement. The person or persons executing this
Agreement on behalf of a Party warrants and represents that he has the authority to execute this
Agreement on behalf of the Party and has the authority to bind that Party to the performance of its
obligations hereunder.
IN WITNESS WHEREOF, the parties have entered into this Separation and General Release
Agreement as of the date first set forth above.
“COMPANY”
BIOLASE TECHNOLOGY, INC.
By:
|
/s/ Xxxxxx X. Xxxxx | |||
| Title: Chairman of the Compensation Committee | ||||
of the Board of Directors |
“EMPLOYEE”
/s/ Xxxxx X. Xxxxxx |
||
5
EXHIBIT A
BIOLASE TECHNOLOGY, INC.
TERMINATION CERTIFICATION
This is to certify that based on a reasonably diligent search by me to date, and to the best of my
knowledge, I do not have in my possession, nor have I failed to return, any devices, records, data,
notes, reports, proposals, lists, correspondence, specifications, drawings, blueprints, sketches,
materials, equipment, other documents or property, or reproductions of any aforementioned items
which is a trade secret and/or proprietary information belonging to BioLase Technology, Inc., its
subsidiaries, affiliates, successors or assigns (together, the “Company”). If I locate any such
materials after the date of this certification, I will cause such materials to be delivered to the
Company within two (2) business days.
I further certify that, to the best of my knowledge, I have complied with all the terms of the
Company’s Employee Proprietary Information Agreement signed by me.
I further agree that, in compliance with the Employee Proprietary Information Agreement, I will
preserve as confidential all trade secrets, confidential knowledge, data or other proprietary
information relating to products, processes, know-how, designs, formulas, developmental or
experimental work, computer programs, data bases, other original works of authorship, customer
lists, business plans, financial information or other subject matter pertaining to any Business of
the Company or any of its clients, consultants or licensees which is proprietary and/or
confidential information to the Company.
Date:
| Xxxxx X. Xxxxxx | ||||
6
EXHIBIT B
GENERAL RELEASE AND WAIVER OF CLAIMS
In consideration of the payments and other benefits set forth in the Separation and General
Release Agreement, dated as of August 24, 2010, by and between Executive and the Company (the
“Agreement”), to which this form shall be deemed to be attached, Xxxxx X. Xxxxxx (“Executive”)
hereby agrees to the following general release and waiver of claims (“General Release”).
In exchange for the consideration to be paid and provided to Executive by the Agreement,
Executive hereby generally and completely releases Biolase Technology, Inc. (the “Company”) and its
directors, officers, employees, shareholders, partners, agents, attorneys, predecessors,
successors, parent and subsidiary entities, insurers, affiliates, and assigns from any and all
claims, liabilities and obligations, both known and unknown, that arise out of or are in any way
related to events, acts, conduct, or omissions occurring from the beginning of the world to my
signing of this General Release. This general release includes, but is not limited to: (1) all
claims arising out of or in any way related to Executive’s employment with the Company or the
termination of that employment; (2) all claims related to Executive’s compensation or benefits from
the Company, including salary, bonuses, commissions, vacation pay, expense reimbursements,
severance pay, fringe benefits, stock, or any other ownership interests in the Company; (3) all
claims for breach of contract, wrongful termination, and breach of the implied covenant of good
faith and fair dealing; (4) all tort claims, including claims for fraud, defamation, emotional
distress, and discharge in violation of public policy; and (5) all federal, state, and local
statutory claims, including claims for discrimination, harassment, retaliation, attorneys’ fees, or
other claims arising under Title VII of the 1964 Civil Rights Act, as amended, the Age
Discrimination in Employment Act, the California Fair Employment and Housing Act, the Equal Pay Act
of 1963, as amended, the provisions of the California Labor Code, the Americans with Disabilities
Act, the Fair Labor Standards Act, the Employee Retirement Income Security Act of 1974, as amended
(“ERISA”), the Xxxxxxxx-Xxxxx Act of 2002, and any other state, federal, or local laws and
regulations relating to employment and/or employment discrimination. The only exceptions are claims
Executive may have for unemployment compensation and worker’s compensation, Base Salary (through
the date of termination), outstanding business expenses, and unused vacation earned through the
date of termination of Executive.
Executive expressly waives and relinquishes any and all rights and benefits Executive now has
or may have in the future under the terms of Section 1542 of the Civil Code of the State of
California, which sections reads in full as follows:
A general release does not extend to claims which the creditor does not know or
suspect to exist in his or her favor at the time of executing the release, which if
known by him or her must have materially affected his or her
settlement with the debtor.
7
Notwithstanding said Code Section, Executive knowingly and voluntarily waives the provisions of
Section 1542 as well as any other statutory or common law provisions of similar effect and
acknowledges and agrees that this waiver is an essential part of this General Release.
Executive acknowledges that, among other rights, Executive is waiving and releasing any rights
Executive may have under ADEA, that this General Release is knowing and voluntary, and that the
consideration given for this General Release is in addition to anything of value to which Executive
was already entitled as an executive of the Company. Executive further acknowledge that Executive
has been advised, as required by the Older Workers Benefit Protection Act, that: (a) the General
Release granted herein does not relate to claims under the ADEA which may arise after this General
Release is executed; (b) Executive has the right to consult with an attorney prior to executing
this General Release (although Executive may choose voluntarily not to do so); and (c) Executive
has twenty-one (21) days from the date of termination of Executive’s employment with the Company in
which to consider this General Release (although Executive may choose voluntarily to execute this
General Release earlier, in which case he voluntarily waives the remainder of the twenty-one (21)
day period); (d) Executive has seven (7) days following the execution of this General Release to
revoke his consent to this General Release; and (e) this General Release shall not be effective
until the seven (7) day revocation period has expired.
Executive acknowledges his continuing obligations under the Proprietary Information and
Inventions Agreement and the non-solicitation provisions set forth in Section 6 of that certain
Employment Agreement, dated April 29, 2008, by and between the Executive and the Company (the
“Employment Agreement”). Nothing contained in this General Release shall be deemed to modify, amend
or supersede the obligations set forth in such agreements.
By signing this General Release, Executive hereby represents that he is not aware of any
affirmative conduct or the failure to act on the part of the Company, its officers, directors,
and/or employees concerning the Company’s business practices, its reporting obligations, its
customers and/or prospective customers, its products, and/or any other any other aspect of the
Company’s business, which Executive has any reason to believe rises to the level of unfair,
improper and/or unlawful conduct pursuant to any state or federal law, rule, regulation or order,
including, but not limited to, any rule, regulation or decision promulgated or enforced by the
Securities and Exchange Commission, or which has been promulgated or enforced by any other state or
federal office or administrative body pursuant to the Xxxxxxxx-Xxxxx Act of 2002.
With the exception of the terms set forth in the Proprietary Information Agreement, the
Agreement, and the non-solicitation provisions set forth in Section 6 of the Employment Agreement,
this General Release constitutes the complete, final and exclusive embodiment of the entire
agreement between the Company and Executive with regard to the subject matter hereof. Executive is
not relying on any promise or representation by the Company that is not expressly stated herein and
the Company is not relying on any promise or representation by Executive that is not expressly
stated herein. This General Release may only be modified by a writing signed by both Executive and
a duly authorized officer of the Company.
8
The parties agree that this General Release does not in any way compromise or lessen
Executive’s rights to be indemnified by the Company pursuant to that certain Indemnification
Agreement dated April 29, 2008, pursuant to the Company’s by-laws or certificate of incorporation,
or otherwise be covered under any applicable insurance policies that Executive would otherwise be
entitled to receive and/or be covered by.
The parties agree that in no way does this General Release preclude Executive from enforcing
his ownership rights pertaining to any stock or stock options which may have been purchased by
Executive or granted to Executive by the Company pursuant to a written stock option grant and/or as
memorialized in a written Board Resolution (or as reported periodically in the Company’s proxy
statements).
BIOLASE TECHNOLOGY, INC.
By: |
||||
| Title: Chairman of the Compensation Committee | ||||
of the Board of Directors |
||||
| Xxxxx X. Xxxxxx | ||||
9
EXHIBIT C
PRESS RELEASE
10
