August 13, 2009 Jeffrey M. Stibel Ponte Vedra Beach, FL 32082 Dear Jeff:
Exhibit
99.1
Xxx.xxx
Group, Inc.
00000 Xxxx
Xxx Xxxxxxx Xxxx
Xxxxxxxxxxxx,
XX 00000
T 000 000
0000
F 000 000
0000
NASDAQ:
WWWW
August
13, 2009
Xxxxxxx
X. Xxxxxx
000 Xxxxx
Xxxx Xxxx Xxxxx
Xxxxx
Xxxxx Xxxxx, XX 00000
Dear
Xxxx:
This
letter sets forth the transition agreement (the “Agreement”),
effective August 13, 2009 (the “Effective
Date”) that Xxx.xxx Group, Inc. (the “Company”)
is offering to you in connection with your employment transition.
1. Resignation. You
have notified us of your resignation as an employee as of the Effective Date and
you hereby irrevocably resign as President and from the Company’s Board of
Directors effective September 30, 2009 (the “Resignation
Date”), and from all other positions (as an officer or director) with the
Company or any of its subsidiaries and agree to provide a letter to such effect
at the Company’s request.
2. Accrued Salary and Paid Time
Off. On the Effective Date, the Company will pay you all
accrued salary earned through the Effective Date (the “Accrued
Pay”), subject to standard payroll deductions and
withholdings. You are entitled to this payment by law. You will not
be paid for any unused Paid Time Off and will not receive any further
compensation from the Company after the Effective Date for your role as
President and a member of the Board of Directors.
3. Consulting
Agreement. You agree to be available to the Company on limited
basis at least through the end of calendar year 2009 to assist the Company and
to help create a smooth transition. Additionally, the parties may
agree to enter into a consulting agreement on mutually agreeable terms, it being
understood by the Company that this will not prevent you from pursuing any other
activities now or in the future and that these activities may take precedent to
activities associated with the Company.
4. Benefits. Although
the Company has no obligation to do so, in recognition of your prior service and
in consideration of your signing of this Agreement and returning it to the
Company on the Effective Date (including the Release (as defined below)), then
on the Effective Date:
(a) the
Company shall make a lump sum payment to you in an amount equal to $780,000,
less withholdings for taxes totaling $206,310 ($195,000 for Federal and $11,310
for Medicare), and you hereby agree to be responsible for any taxes in excess of
such withholding amount;
(b) with
respect to each outstanding, unvested equity award held by you as of the
Effective Date (all of which you acknowledge and agree are set forth on Exhibit
A hereto), the vesting will accelerate such that, following such
acceleration, the number of shares vested on and as of the Effective Date are as
set forth on Exhibit A hereto under the column heading “Shares Vested Following
Acceleration,” with any portion of any such equity award as to which the vesting
is not accelerated terminating and being forfeited to the Company as of the
Effective Date;
(c) the
post-termination exercise period of each outstanding stock option held by you on
the Effective Date (all of which you acknowledge and agree are set forth on
Exhibit
A hereto) shall end the date set forth on Exhibit A hereto under the
column heading “Exercisable Until Date” (it being expressly understood that such
exercise period shall apply only to the vested portion of each such option,
following the acceleration provided for in Section 3(b) above); and
(d) if
you timely elect COBRA health insurance coverage, the Company will pay your
COBRA premiums for eighteen (18) months following the Effective Date, or until
such earlier date as you are no longer eligible for COBRA coverage or you become
eligible for health insurance coverage from another source (provided that you
must promptly inform the Company, in writing, if you become eligible for health
insurance coverage from another source within eighteen (18) months after the
Effective Date).
Notwithstanding
the foregoing or anything set forth in this Agreement, you shall not be entitled
to the benefits set forth in this Section 4 (such benefits being the “Benefits”)
unless and until the release requirements set forth in Section 11 of this
Agreement are satisfied.
5. Other Compensation or
Benefits. You acknowledge that, except for the compensation
and benefits set forth in this Agreement and the Accrued Pay, you have not
earned and are not entitled to receive, and will not receive from the Company
any additional compensation (including base salary, bonus, incentive
compensation, equity, severance, or benefits) either before or after the
Effective Date, with the exception of any vested right you may have under the
express terms of a written ERISA-qualified benefit plan (e.g., 401(k) account)
or any vested options.
6. Expense Reimbursements. You
agree that, within ten (10) days after the Resignation Date, you will submit
your final documented expense reimbursement statement reflecting all business
expenses you incurred through the Resignation Date, if any, for which you seek
reimbursement. The Company will reimburse you for these expenses
pursuant to its regular business practice.
7. Return of Company
Property. By the close of business on the Resignation Date
unless you continue your services in a consulting capacity, you agree to return
to the Company or destroy all Company documents (and all copies thereof) and
other Company property which you have in your possession or control, including,
but not limited to, Company files, notes, drawings, records, plans, forecasts,
reports, studies, analyses, proposals, agreements, financial information,
research and development information, sales and marketing information, customer
lists, prospect information, pipeline reports, sales reports, operational and
personnel information, specifications, code, software, databases,
computer-recorded information, tangible property and equipment (including, but
not limited to, computers, facsimile machines, mobile telephones, servers),
credit cards, entry cards, identification badges and keys; and any materials of
any kind which contain or embody any proprietary or confidential information of
the Company (and all reproductions thereof in whole or in part). You
agree that you will make a diligent search to locate any such documents,
property and information by the close of business on the Resignation
Date. If you have used any personally owned computer, server, or
e-mail system to receive, store, review, prepare or transmit any Company
confidential or proprietary data, materials or information, within fifteen (15)
business days after the Resignation Date, you shall provide the Company with a
computer-useable copy of such information and then permanently delete and
expunge such Company confidential or proprietary information from those systems;
and you agree to provide the Company access to your system as requested to
verify that the necessary copying and/or deletion is done.
8. Proprietary Information and
Noncompete Obligations. You acknowledge your continuing
obligations under your Proprietary Information and Inventions Agreement dated
June 26, 2007 and your Noncompetition Agreement dated June 26,
2007.
9. Nondisparagement. You
agree not to disparage the Company, its officers, directors, employees,
shareholders, and agents, in any manner likely to be harmful to its or their
business, business reputation, or personal reputation; provided that you will
respond accurately and fully to any question, inquiry or request for information
when required by legal process. The Company shall use its
commercially reasonable efforts to cause its officers and directors, while they
are serving in such capacity, not to disparage you in any manner likely to be
harmful to your business reputation or personal reputation, provided that the
Company, its officer’s, director’s and agents may respond accurately and fully
to any question, inquiry or request for information when required by legal
process.
10. No Admissions. You
understand and agree that the promises and payments in consideration of this
Agreement shall not be construed to be an admission of any liability or
obligation by the Company to you or to any other person, and that the Company
makes no such admission.
11. Release of
Claims. As a condition of receiving the Benefits to which you
would not otherwise be entitled, you must execute, and allow to become
effective, a release in the form attached hereto as Exhibit B (the “Release”)
on the Effective Date. Unless you timely execute the Release, deliver
the Release to the Company on the Effective Date, (the “Release
Date”), you shall not receive any of the Benefits. The
acceleration of equity awards and the lump sum payment set forth in Section 2(a)
shall be paid to you within two (2) business days following the Release
Date.
12. Representations. You
hereby represent that you have been paid all compensation owed and for all hours
worked, have received all the leave and leave benefits and protections for which
you are eligible pursuant to the Family and Medical Leave Act or otherwise, and
have not suffered any on-the-job injury for which you have not already filed a
workers’ compensation claim. You also represent that your employment
was not involuntarily terminated and therefore you do not qualify for a premium
reduction under the American Recovery and Reinvestment Act of 2009.
13. Miscellaneous. This
Agreement, together with any documents referenced hereby, constitutes the
complete, final and exclusive embodiment of the entire agreement between you and
the Company with regard to its subject matter. You acknowledge and
agree that the terms set forth herein shall supersede and extinguish the
severance provisions set forth in the Employment Agreement and that you are not
entitled to any severance benefits, change of control benefits or other benefits
thereunder. It is entered into without reliance on any promise or
representation, written or oral, other than those expressly contained herein,
and it supersedes any other such promises, warranties or
representations. This Agreement may not be modified or amended except
in a writing signed by both you and a duly authorized officer of the
Company. This Agreement will bind the heirs, personal
representatives, successors and assigns of both you and the Company, and inure
to the benefit of both you and the Company, their heirs, successors and
assigns. If any provision of this Agreement is determined to be
invalid or unenforceable, in whole or in part, this determination will not
affect any other provision of this Agreement and the provision in question will
be modified so as to be rendered enforceable. This Agreement will be
deemed to have been entered into and will be construed and enforced in
accordance with the laws of the State of Florida without regard to conflict of
laws principles. Any ambiguity in this Agreement shall not be
construed against either party as the drafter. Any waiver of a breach
of this Agreement shall be in writing and shall not be deemed to be a waiver of
any successive breach. This Agreement may be executed in counterparts
and facsimile signatures will suffice as original signatures.
We wish
you the best in your future endeavors.
Sincerely,
Xxx.xxx
Group, Inc.
By: /s/ Xxxxxxx X.
XxXxxxx
Name: Xxxxxxx X.
XxXxxxx
Title: Chief Legal
Officer
I
have read, understand and agree fully to the foregoing Agreement:
/s/ Xxxxxxx X.
Xxxxxx
Xxxxxxx
X. Xxxxxx
August 13,
2009
Date
Exhibit 99.1
Exhibit
A
|
Date
of Grant
|
Type
of Award
|
Shares
Subject
to
Award
|
Cumulative
Shares
Vested
Following
Acceleration
|
Exercisable
Until
Date
|
||||
|
7/28/2005
|
NQO
|
1,151,562
|
1,151,562
|
7/27/2013
|
||||
|
3/31/2006
|
ISO
|
11,587
|
11,587
|
9/11/2009
|
||||
|
3/31/2006
|
NQO
|
91,531
|
91,531
|
8/13/2010
|
||||
|
3/31/2006
|
NQO
|
6
|
6
|
8/13/2010
|
||||
|
5/13/2008
|
ISO
|
11,442
|
9,296
|
11/12/2009
|
||||
|
5/13/2008
|
NQO
|
63,558
|
51,641
|
8/13/2010
|
||||
|
5/13/2008
|
NQO
|
75,000
|
60,938
|
8/13/2010
|
||||
|
5/13/2008
|
RSA
|
60,000
|
45,000
|
N/A
|
||||
|
2/4/2009
|
RSA
|
158,000
|
79,000
|
N/A
|
Exhibit 99.1
Exhibit
B
Release
Agreement
I
understand that I have resigned my employment with Xxx.xxx
Group, Inc. (the “Company”)
effective August 13, 2009 (the “Resignation
Date”). The Company has agreed that if I choose to sign this
Release Agreement (this “Release”),
the Company will provide me with certain Benefits (minus the standard
withholdings and deductions) as defined in and pursuant to the terms of the
agreement to which this Release is attached as Exhibit B entered into on August
13, 2009 (the “Agreement”),
between myself and the Company, and any agreements incorporated therein by
reference. Any capitalized terms used in this Release but not defined
herein have the meanings ascribed to them in the Agreement. I
understand that I am not entitled to the Benefits unless I sign this
Release. I understand that, regardless of whether I sign this
Release, the Company will pay me all of my Accrued Pay, to which I am entitled
by law.
In
consideration for the Benefits, I hereby generally and completely release the
Company and its officers, directors, agents, attorneys, employees, shareholders,
parents, subsidiaries, and affiliates from any and all claims, liabilities,
demands, causes of action, attorneys’ fees, damages, or obligations of every
kind and nature, whether they are now known or unknown, arising at any time
prior to, on or after the date I sign this Release. This general
release includes, but is not limited to: (a) all claims arising out of or in any
way related to my employment with the Company or the termination of that
employment; (b) all claims related to my compensation or benefits from the
Company, including salary, bonuses, commissions, vacation pay, expense
reimbursements, severance pay, fringe benefits, stock, stock options, or any
other ownership interests in the Company; (c) all claims for breach of
contract, wrongful termination, and breach of the implied covenant of good faith
and fair dealing (including, but not limited to, any claims based on or arising
from the Agreement); (d) all tort claims, including claims for fraud,
defamation, emotional distress, and discharge in violation of public policy; and
(e) all federal, state, and local statutory claims, including claims for
discrimination, harassment, retaliation, attorneys’ fees, or other claims
arising under the federal Civil Rights Act of 1964 (as amended) and the federal
Americans with Disabilities Act of 1990. Notwithstanding the release
in the preceding sentence, I am not releasing any right of indemnification I may
have in my capacity as an employee, officer and/or director of the Company
pursuant to any express indemnification agreement or otherwise, nor am I
releasing any rights I may have as an owner and/or holder of the Company’s
common stock and stock options. Excluded from this Release are any
claims that, by law, cannot be waived. I am waiving, however, my
right to any monetary recovery should any agency, such as the Equal Employment
Opportunity Commission, pursue any claims on my behalf.
In
releasing claims unknown to me at present, I am waiving all rights and benefits
under any
law or legal principle in any jurisdiction related to the
following: “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.”
I hereby
represent that I have been paid all compensation owed and for all hours worked,
have received all the leave and leave benefits and protections for which I am
eligible, pursuant to the Family and Medical Leave Act or otherwise, and have
not suffered any on-the-job injury for which I have not already filed a
claim.
Understood
and Agreed:
Xxxxxxx
X. Xxxxxx
/s/ Xxxxxxx X.
Xxxxxx
Dated:
August 13,
2009
