Exhibit 10.5
EXECUTION COPY
SEPARATION AND RELEASE AGREEMENT
This Separation and Release Agreement ("Agreement") is entered into as of this
17th day of September, 2003, between Cosi, Inc., a Delaware corporation, and any
successor thereto (collectively, the "Company") and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ (the
"Executive").
The Executive and the Company agree as follows:
The employment relationship between the Executive and the Company
terminated on August 18, 2003 (the "Effective Date").
1. In consideration of Executive's execution of this Agreement, the
Company has agreed to pay the Executive certain payments and to make
certain benefits available as set forth on Annex 1 hereto.
2. For and in consideration of the payments and/or other benefits to
be provided to and/or on behalf of the Executive pursuant to this
Agreement, the sufficiency of which the Executive hereby acknowledges, the
Executive, on behalf of the Executive and the Executive's heirs, executors
and assigns, hereby releases and forever discharges the Company and its
stockholders, parents, affiliates, subsidiaries, divisions, any and all
current and former directors, officers, executives and agents thereof, and
their heirs and assigns, and any and all pension benefit or welfare
benefit plans of the Company, including current and former trustees and
administrators of such pension benefit and welfare benefit plans
(collectively, the "Releasees"), from all claims, charges, or demands, in
law or in equity, whether known or unknown, which may have existed or
which may now exist from the beginning of time to the date of this
Agreement, including, without limitation, any claims the Executive may
have arising from or relating to the Executive's employment or termination
from employment with the Company, including a release of any rights or
claims the Executive may have under Title VII of the Civil Rights Act of
1964, as amended, and the Civil Rights Act of 1991 (which prohibit
discrimination in employment based upon race, color, sex, religion, and
national origin); the Americans with Disabilities Act of 1990, as amended,
and the Rehabilitation Act of 1973 (which prohibit discrimination based
upon disability); the Family and Medical Leave Act of 1993 (which
prohibits discrimination based on requesting or taking a family or medical
leave); Section 1981 of the Civil Rights Act of 1866 (which prohibits
discrimination based upon race ); Section 1985(3) of the Civil Rights Act
of 1871 (which prohibits conspiracies to discriminate); the Executive
Retirement Income Security Act of 1974, as amended (which prohibits
discrimination with regard to benefits); any other federal, state or local
laws against discrimination; or any other federal, state, or local
statute, or common law relating to employment, wages, hours, or any other
terms and conditions of employment. This includes a release by the
Executive of any claims for wrongful discharge, breach of contract, torts
or any other claims in any way related to the Executive's employment with
or resignation or termination from the Company. This release also includes
a release of any claims for age discrimination under the Age
Discrimination in Employment Act, as amended ("ADEA"). The ADEA requires
that the Executive be advised to consult with an attorney before the
Executive waives any claim under ADEA. In addition,
the ADEA provides the Executive with at least 21 days to decide whether to
waive claims under ADEA and seven days after the Executive signs this
Agreement to revoke that waiver. Notwithstanding the foregoing provisions
of this Section 3, the release given by the Executive hereunder shall not
apply to, and the Executive shall retain and shall be entitled to enforce
by litigation or otherwise, all rights arising under or with respect to
(i) the obligations of the Company to indemnify and hold harmless the
Executive, (ii) all directors and officers liability insurance coverage
applicable to the Executive, (iii) the Executive's rights to enforce the
terms of this Agreement, and (iv) any and all benefits to which the
Executive shall be entitled under the terms of the Company's employee
benefit plans.
3. Executive confirms that as of the date hereof he has not filed,
caused to be filed, or is a party to any claim, charge, complaint, or
action against the Releasees in any forum or form. In the event that any
such claim, charge, complaint or action is filed with respect to matters
arising prior to the date hereof, Executive shall not be entitled to
recover any relief or recovery therefrom, including costs and attorney's
fees. Executive further confirms that he has no known workplace injuries
as of the date hereof.
4. This Agreement is not an admission by either the Executive or the
Company of any wrongdoing or liability.
5. The Executive agrees he will not make, or cause any other person
to make, any false, disparaging or derogatory statements regarding the
Company or its subsidiaries or any of their respective current or former
shareholders, directors, officers, employees, agents or representatives
(in their respective capacities as current or former shareholders,
directors, officers, employees, agents or representatives of the Company
or its subsidiaries). The Executive further agrees not to take any action
or make any statement the effect of which would be directly or indirectly
to materially impair the goodwill of the Company, including, but not
limited to any action or statement intended, directly or indirectly, to
benefit a competitor of the Company. The Company shall take all reasonable
measures to cause the senior officers and directors of the Company (in
their respective capacities as senior officers and directors of the
Company) not to make any false, disparaging or derogatory statements
regarding the Executive.
6. Executive agrees not to disclose any information regarding the
existence or substance of this Agreement, except to an attorney or
professional advisors with whom Executive chooses to consult regarding her
consideration of this Agreement, or as may be otherwise required by law.
7. Executive acknowledges and agrees that he is bound by the
Confidentiality and Non-Compete Agreement dated as of April, 10 2000, (the
"Confidentiality Agreement"), a copy of which is attached hereto as
Exhibit A. Notwithstanding the provisions of the Confidentiality
Agreement, in consideration of the execution of this Agreement, Employer
has agreed that it will not unreasonably withhold its consent to Executive
entering the employ of, or otherwise rendering services to, an entity
engaged in providing the same or similar services or products as provided
by the Company. In this regard, the parties hereto agree that Paragraph
5(ii) of the Confidentiality Agreement is deleted in its entirety and
replaced with the following:
-2-
"(ii) Executive hereby agrees that, during the term of Executive's
employment with the Company and for a period of six (6) months thereafter,
Executive shall not, directly or indirectly, without the express prior written
consent of the Company, which shall not be unreasonably withheld, (a) enter the
employ of, or render any services to, any person, firm, corporation or other
entity engaged in providing the same or similar services or products as provided
by the Company; or, (b) engage in any business in competition with the Company
on Executive's own account or become interested in any such business, directly
or indirectly, as an individual, partner, shareholder, director, officer,
principal, agent, employee, trustee, consultant, or in any other relationship or
capacity. Nothing contained in this paragraph shall be deemed to prohibit you
from acquiring, solely as an investment, securities of any public corporation."
Other than the amendment to Paragraph 5(ii) of the Confidentiality
Agreement, the Confidentiality Agreement shall remain unchanged, fully
effective, and is ratified and confirmed in all respects.
8. The Company shall indemnify the Executive to the fullest extent
permissible under its by-laws as in effect on the date hereof, including,
without limitation, by reason of Executive's acting as (i) a "Permittee"
under liquor licenses obtained on behalf of the Company and (ii) a
signatory of the Company's tax returns and filings. The Company shall take
all reasonable measures to replace Executive as Permittee under the
aforementioned liquor licenses as soon as possible.
9. The Executive waives any right to reinstatement or future
employment with the Company following the Executive's separation from the
Company on August 18, 2003.
10. The Executive agrees not to engage in any act after execution of
this Agreement that is intended, or may reasonably be expected to harm the
reputation, business, prospects or operations of the Company, its
officers, directors, stockholders or executives. The Executive will take
no action which would reasonably be expected to lead to unwanted or
unfavorable publicity to the Company.
11. The Executive agrees to cooperate reasonably with the Company
and its counsel in regard to any litigation, investigation, or similar
action presently pending or subsequently initiated involving matters of
which the Executive has knowledge as a result of Executive's employment
with the Company (each, an "Action"). Such reasonable cooperation shall
consist of the Executive making himself available at reasonable times for
consultation with officers of the Company and its counsel and for
depositions or other similar activity. The Executive shall not receive any
additional compensation for rendering such assistance. The Company agrees
to keep the Executive reasonably informed with respect to any Action.
12. This Agreement shall be governed by and construed in accordance
with the laws of the State of New York, without reference to the
principles of conflict of laws. Exclusive jurisdiction with respect to any
legal proceeding brought concerning any
-3-
subject matter contained in this Agreement shall be settled by arbitration
in New York, New York in accordance with the applicable rules of the
American Arbitration Association; provided that each party shall be
responsible for its own costs and expenses in any such legal proceeding.
13. This Agreement represents the complete agreement between the
Executive and the Company concerning the subject matter in this Agreement
and supersede all prior agreements or understandings, written or oral.
This Agreement may not be amended or modified otherwise than by a written
agreement executed by the parties hereto or their respective successors
and legal representatives.
14. It is further understood that for a period of seven (7) days
following the execution of this Agreement in duplicate originals, the
Executive may revoke this Agreement, and this Agreement shall not become
effective or enforceable until this revocation period has expired. No
revocation of this Agreement by the Executive shall be effective unless
the Company has received within the seven (7) day revocation period,
written notice of any revocation, all monies received by the Executive
under this Agreement and all originals and copies of this Agreement.
15. This Agreement has been entered into voluntarily and not as a
result of coercion, duress, or undue influence. The Executive acknowledges
that the Executive has read and fully understands the terms of this
Agreement and has been advised to consult with an attorney before
executing this Agreement. Executive acknowledges that he has been advised
in writing to consult with an attorney prior to execution of this
Agreement. Additionally, the Executive acknowledges that the Executive has
been afforded the opportunity of at least twenty-one (21) days to consider
this Agreement.
16. This Agreement may be executed in two or more counterparts, each
of which shall be deemed an original. This Agreement and any counterpart
so executed shall be deemed one in the same instrument.
[REMAINDER OF PAGE INTENTIONALLY
LEFT BLANK; SIGNATURE PAGE FOLLOWS]
-4-
The parties to this Agreement have executed this Agreement as of the
day and year first written above.
COSI, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
------------------------------
Name:
Title:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
--------------------------------------
ANNEX 1
The Executive shall receive the following severance payments and benefits, less
any applicable withholding taxes:
1) 26 bi-weekly payments of $9,615.38 commencing on the next payroll date of
the Company following the seventh day of the expiration of the revocation
period in Section 14 of the Agreement.
2) A lump sum payment of $31,250.00 in respect of Executive's accrued
vacation to be made within 7 days following the expiration of the
revocation period in Section 14 of the Agreement.
3) All Company stock options granted to the Executive during his employment
with the Company shall continue to vest and shall be exercisable in
accordance with the terms of each agreement evidencing each such grant as
if Executive's employment with the Company had not terminated; provided
that each such option shall not be subject to accelerated exercise
requirements or early termination provisions; provided that Executive does
not revoke the Agreement pursuant to Section 14 thereof.
4) In the event that the Executive's elects continuing benefits coverage
pursuant to his rights under the Consolidated Omnibus Budget
Reconciliation Act ("COBRA"), Executive shall be entitled to continue such
coverage and the Company shall pay the cost of such coverage for a period
of 12 months following the Effective Date; provided that Executive does
not revoke the Agreement pursuant to Section 14 thereof. After such
12-month period, Executive shall pay the cost of continuing COBRA coverage
at his own expense and shall make payment directly to the Company's
insurance provider.
5) The Company shall reimburse Executive for the reasonable and necessary
out-of-pocket expenses incurred by Executive in performing his duties
while employed by the Company within 7 days of the presentation of such
documentation thereof as the Company normally and customarily requires of
its employees generally.
6) The Company shall return all items of personal property left in
Executive's former office at the Company at its expense and shall provide
Executive with a copy of any personal information contained on his
Company-owned lap top computer.
7) The Company shall reimburse Executive for the reasonable legal expenses
incurred by Executive in connection with the negotiation of this Agreement
within 7 days of the presentation of reasonable documentation thereof
following the expiration of the revocation period in Section 14 of the
Agreement.
