Exhibit 10.16
SEVERANCE AGREEMENT AND MUTUAL RELEASE
This Severance Agreement and Mutual Release (the "Agreement") is entered
into by and between Xxxxxx Xxxxx ("XXXXX") and RXI Plastics, Inc. ("RXI").
For purposes of this Agreement, XXXXX shall be defined to include Xxxxxx
Xxxxx, and anyone claiming or liable through him including, but not limited
to, his past, present, and future agents, attorneys, representatives, heirs,
executors, administrators, spouses, family, and the predecessors, successors,
and assigns of each of them.
For purposes of this Agreement, RXI shall be defined to include RXI
Plastics, Inc., and anyone claiming or liable through RXI Plastics, Inc.
including, but not limited to, any and all parents, divisions, subsidiaries,
affiliates, and/or other related entities of RXI Plastics, Inc. (whether or
not such entities are wholly-owned).
The EFFECTIVE DATE of this Agreement shall be seven (7) days after the
Agreement is signed by XXXXX, on which date this Agreement becomes binding on
XXXXX. In the event RXI signs this Agreement more than seven days after
XXXXX signs this Agreement, then the EFFECTIVE DATE of this Agreement shall
be the date upon which RXI signs this Agreement.
RECITALS
WHEREAS, XXXXX will, effective July 1, 1996, leave the employ of RXI and
RXI Holdings, Inc. and will no longer serve as an officer or director of
either entity as of said date;
WHEREAS, XXXXX and RXI seek amicably to resolve and settle potential
disputes and/or potential claims between them;
WHEREAS, the execution, delivery and performance of this Agreement by RXI
has been duly and validly authorized by all necessary corporate action;
NOW THEREFORE, in return for the promises, consideration, mutual
covenants, agreements, and conditions provided for in this Agreement, which
XXXXX and RXI acknowledge constitute the receipt of valuable consideration by
each of them, and intending to be legally bound, the parties agree as follows:
AGREEMENT
1. Provided XXXXX complies with the provisions in Paragraphs 5.1
through 5.5 hereof through December 31, 1999, RXI hereby agrees to pay
XXXXX the sum of $15,513.00 on the last day of each month commencing July
31, 1996 through and including June 30, 2002 (the "Payment Term"). In
the event of CASEY's death on or prior to December 31, 1998, RXI's
obligations under this Paragraph 1 shall cease 12 months after such death. In
the event of CASEY's death after December 31, 1998, RXI will continue to
make payments hereunder to CASEY's estate for the balance of the Payment
Term. In the event of CASEY's breach of this Agreement on or prior to
December 31, 1999, RXI's obligations under this
Agreement will immediately cease. A breach of this Agreement subsequent to
December 31, 1999 will not cause RXI's obligations, under this Section 1,
to be terminated or suspended. The aforesaid sum is being paid in
settlement of the compensation obligations of RXI and is fully subject to
applicable taxes. RXI shall withhold all applicable taxes.
2. XXXXX shall cease to be employed by RXI as of July 1, 1996 and
shall cease on such date to be a participant in all plans including health
and life insurance plans.
3. XXXXX agrees to the cancellation in full of the Stock Option
Agreement with RXI Holdings, Inc., dated as of January 1, 1995 without
exercise of any options.
4. XXXXX agrees not to bring any action against RXI which relates to,
arise out of, or results from CASEY's employment with RXI or the termination
thereof, whether under the Employment Agreement dated as of January 1,
1995, the Assignment and Assumption Agreement dated as of May 31, 1996, or
otherwise, except claims arising under this Agreement.
5.1 Except as permitted by RXI's Board, XXXXX shall not divulge,
furnish, disclose or make accessible to anyone for use in any way any
confidential or secret knowledge or information of RXI or RXI Holdings, Inc.,
or any subsidiary of RXI Holdings, Inc., (collectively "Company") which
XXXXX has acquired or become acquainted with while employed by RXI or
Texberry Container Corporation ("Texberry"), whether developed by himself
or by others, concerning any trade secrets, confidential or secret designs,
processes, formulae, software or computer programs, plans, devices or
material (whether or not patented or patentable, copyrighted or
copyrightable) directly or indirectly useful in any aspect of Company's
business, any confidential customer or supplier lists of the Company, any
confidential or secret development or research work of the Company, or any
other confidential, secret or nonpublic aspects of the business of the
Company.
5.2 Upon the request of the Company and without further compensation
therefor, but at no expense to XXXXX, XXXXX will provide reasonable
assistance, including but not limited to, the execution of papers and lawful
oaths and the giving of testimony, that in the opinion of RXI, its successors
and assigns, may be necessary or desirable (i) in obtaining, sustaining,
reissuing, extending and enforcing United States and foreign Letters Patents,
including, but not limited to , design patents, on any inventions or
trademark of RXI, (ii) for perfecting, affirming and recording RXI's complete
ownership and title of its assets, and (iii) in prosecuting or defending
litigation relating to matters as to which XXXXX has knowledge, and XXXXX
agrees otherwise to cooperate fully in all proceedings and matters relating
to the Company.
5.3 XXXXX agrees that he shall not, during the period July 1,
1996 and through and including December 31, 1999 (the "Term"), engage in
competition with RXI Container within the States of Texas or Louisiana (the
"Territory") in any manner or capacity (e.g. as a management consultant,
principal, partner, officer, director, stockholder or management employee) in
any phase of RXI Container's business as presently being conducted. Ownership
by XXXXX, as a passive investment, of less than 2% of the outstanding shares
of capital stock of any corporation listed on a national securities exchange
or publicly traded in the over-the-counter market shall not constitute a
breach of this Paragraph 5. Xxxxx further agrees
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that he will not, assist or encourage any other person in carrying out,
any activity that would be prohibited by the above provisions of this
Paragraph 5 if such activity were carried out by XXXXX, either, and in
particular XXXXX agrees that he will not induce any employee of the
Company to carry out, any such activity.
5.4 XXXXX agrees that, during the Term, he will not on his own behalf
or in the service or on behalf of others, solicit, divert or appropriate, or
attempt to solicit, divert or appropriate, to any competing business (i) any
person or entity whose account with the Company was sold or serviced by or
under the supervision of XXXXX while employed by RXI or Texberry, or (ii) any
person or entity whose account with RXI Container (or its predecessor,
Texberry Container Corporation) has been directly solicited at least twice by
the Company within the eighteen (18) month period prior to the date hereof.
5.5 XXXXX agrees that he will not, during the Term, on his own behalf
or in the service or on behalf of others solicit, divert or hire away, or
attempt to solicit, divert or hire away any person then employed by RXI
Container or then serving as a sales representative of RXI Container.
6. XXXXX hereby releases. forever discharges, and agrees not to xxx
RXI and/or its parents, divisions, subsidiaries, affiliates, and related
entitles, and its or their past, present, and future owners, trustees,
fiduciaries, administrators, agents, directors, officers, employees and
attorneys, and the predecessors, successors, and assigns of each of them (the
"RXI RELEASED PARTIES") from and for any and all claims (except claims
arising from this Agreement), demands, damages, debts, controversies,
liabilities, accounts, reckonings, obligations, costs, expenses, attorneys'
fees, actions, liens, and/or causes of action, whether known or unknown,
which XXXXX now has, has ever had, or may have in the future against the RXI
RELEASED PARTIES based upon, arising out of, or concerning or pertaining to
or by virtue of any act, omission, matter, fact, occurrence, transaction,
thing, state of facts, claim, contention, statement, or event occurring or
existing at any time from the beginning of the world up to and including the
EFFECTIVE DATE of this Agreement, excluding, however, any claims arising
under this Agreement. Without limiting the generality of the foregoing, this
General Release applies to any and all claims which in any way relate to,
arise out of, or result from CASEY's employment with Texberry or RXI
including, but not limited to, any claims which could have been raised under
any state's Fair Employment and Housing Act, Title VII of the Civil Rights
Act of 1964 as amended, the American's with Disabilities Act (ADA), the Age
Discrimination in Employment Act (ADEA), and the Employees Retirement Income
Security Act (ERISA), or any other federal, state, or local law, regulation,
ordinance, or common law claim. However, the release in this paragraph
specifically excepts and does not apply to claims which are based upon,
relate to, arise out of fraud, willfull violations of law (except only those
statutes relating to employment, employment practices and employee benefit
plans, claims under which are waived in full), embezzlement, willful
misconduct or breach of fiduciary duty, all of which are expressly reserved.
XXXXX represents that he is presently unaware of the existence of any such
excluded claims against any RXI Released Party.
7. RXI hereby releases, forever discharges, and agrees not to xxx XXXXX
from and for any claims (except for claims arising under this Agreement),
demands, damages,
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debts, controversies, liabilities, accounts, reckonings, obligations, costs,
expenses, attorneys' fees, actions, liens, and/or causes of action, whether
known or unknown, which RXI or RXI Holdings now has, has ever had, or may
have in the future against XXXXX based upon, arising out of, or concerning or
pertaining to or by virtue of any act, omission, matter, fact, occurrence,
transaction, thing, state of facts, claim, contention, statement, or event
occurring or existing at any time from the beginning of the world up to and
including the EFFECTIVE DATE of this Agreement, excluding, however, any
claims arising under this Agreement. However, the release in this paragraph
specifically excepts and does not apply to any claims which are based upon,
relate to, or arise out of fraud, willful violation of law (except only those
statutes relating to employment, employment practices and employee benefit
plans, claims under which are waived in full), embezzlement, willful
misconduct, or breach of fiduciary duty, all of which are expressly reserved.
The person executing this document on behalf of RXI represents that he is
presently unaware of the existence of any such excluded claims against XXXXX.
8. XXXXX and RXI have each read and understood the following language
contained in Section 1542 of the California Civil Code:
"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH
THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXISTS IN
HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH
IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS
SETTLEMENT WITH THE DEBTOR."
Having reviewed this provision, XXXXX and RXI nevertheless hereby voluntarily
waive the benefits of this provision and release each other from all
liability for unknown claims.
REPRESENTATIONS AND ACKNOWLEDGEMENTS
9. XXXXX expressly warrants and represents that he has not transferred
or assigned to any other person, firm, corporation, or other legal entity any
claims, rights, or causes of action against the RXI RELEASED PARTIES, or any
of them.
10. XXXXX hereby covenants and represents that he has not brought any
legal or administrative action against the RXI RELEASED PARTIES in connection
with or relating to his employment with RXI.
11. XXXXX hereby acknowledges to RXI that no other party nor any agent
or attorney of any other party has made any promise, representation or
warranty whatsoever, express or implied, written or oral, not contained
herein concerning the subject matter hereof to induce XXXXX to execute this
Agreement, and XXXXX acknowledges that he has not executed this Agreement in
reliance on any promise, representation or warranty not contained herein.
12. The parties, and both of them, represent and warrant that they
have read this Agreement and fully understand and appreciate the terms of
this Agreement and their effect.
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MISCELLANEOUS TERMS
13. In compliance with the requirements of the Age Discrimination In
Employment Act as amended by the Older Workers' Benefit Protection Act of
1990, XXXXX acknowledges by his signature below that he has read and
understands this Agreement and specifically understands the following:
a. That he may consult with an attorney before signing this Agreement
and that RXI advises him to do so;
b. That he is releasing RXI from, among other things, any claims
which he might have against it pursuant to the Age Discrimination In Employment
Act as amended;
c. That this Agreement does not cover the rights or claims that may
arise under the Age Discrimination In Employment Act after the date of
execution of this Agreement;
d. That he has been given by RXI a period of twenty-one (21) days in
which to consider this Agreement; and
e. That he may revoke this Agreement during the seven (7) day period
following the execution of this Agreement and that the agreed Agreement will
not be become binding and effective until the seven (7) day revocation period
has expired. In the event of any such revocation, XXXXX shall repay any
amount paid XXXXX under Paragraph 1 herein.
14. In the event that either of the parties must resort to legal
action in order to enforce any provision or right under this Agreement or to
defend such suit, the prevailing party shall be entitled to receive
reimbursement from the non-prevailing party or parties for all reasonable
attorneys' fees and costs incurred in the litigation of such suit.
15. This Agreement effects the settlement of potential claims and
nothing contained herein shall be construed as an admission by either party
hereto of any wrongdoing of any kind.
16. This Agreement constitutes the entire agreement and understanding
between the parties with respect to the subject matter hereof and all prior
negotiations, agreements, understandings, written or oral, between the
parties are deemed superseded and are replaced hereby. No provision may be
changed, waived or modified, except in writing, signed by the parties hereto.
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17. THIS AGREEMENT SHALL IN ALL RESPECTS BE INTERPRETED, ENFORCED, AND
GOVERNED BY AND UNDER THE LAWS OF THE STATE OF CALIFORNIA. ANY AND ALL CLAIMS
ARISING FROM OR IN CONNECTION WITH THIS AGREEMENT SHALL BE SUBJECT TO THE
EXCLUSIVE JURISDICTION OF THE COURTS OF CALIFORNIA. THE LANGUAGE OF THIS
AGREEMENT SHALL BE CONSTRUED AS A WHOLE ACCORDING TO ITS FAIR MEANING, AND
NOT STRICTLY FOR OR AGAINST EITHER OF THE PARTIES HERETO.
/s/ HC INITIALS /s/ ML
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HC ML
18. XXXXX and RXI agree that they will execute and deliver all such
further documents and instruments and shall carry out all such further acts as
may be reasonably necessary and appropriate to effectuate or implement the
terms hereof.
19. No waiver of any of the provisions of this Agreement shall be
deemed or shall constitute a waiver of any other provisions hereof, nor shall
such waiver constitute a continuing waiver. The parties hereto may amend or
modify this Agreement only in such manner as may be agreed upon by written
instrument executed by all parties hereto.
20. This Agreement may be executed in parts or counterparts, and a
facsimile signature will have the same force and effect as an original
signature penned in ink. When each of the parties hereto has signed and
delivered at least one such counterpart, each counterpart shall be deemed an
original and when taken together with other signed counterparts, shall
constitute one fully executed Agreement which shall be binding upon and
effective as to all parties in accordance with the terms stated above.
IN WITNESS WHEREOF, now the parties hereto have caused this Agreement to
be executed as of the day and year indicated below.
Date: 7/12 , 1996 /s/ Xxxxxx Xxxxx
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XXXXXX XXXXX
0000 Xxxxxxxxx Xxxx Xxxxx
Xxxxxxxxx, Xxxxx 00000
Date: July 10, 1996 RXI PLASTICS, INC.
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By: /s/ Xxxxxx Xxxxxxx
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Xxxxxx Xxxxxxx
Chief Financial Officer
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