GENERAL RELEASE OF ALL CLAIMS AND NON RENEWAL OF EMPLOYMENT AGREEMENT
This General Release of All Claims and Non Renewal of Employment
Agreement ("Agreement") is made and entered into by and between Xxxxxxxxx X.
Xxxxx ("Xxxxx") and Anacomp, Inc. ("Anacomp").
RECITALS
X. Xxxxx is an Executive Vice President of Anacomp.
X. Xxxxx is employed pursuant to an Employment Agreement dated December
15, 1997 (herein "Employment Agreement").
X. Xxxxx is also signatory to a "Confidentiality, Non-Competition and
Non-Disclosure Agreement" dated December 15, 1997, a copy of which is attached
to this Agreement as Exhibit A (herein "Confidentiality Agreement").
D. Anacomp has elected not to renew or extend Xxxxx'x Employment
Agreement. Xxxxx'x employment with Anacomp shall terminate effective December
31, 1999.
E. Anacomp and Xxxxx desire to settle fully and finally all of the
differences, if any, between them on the terms and conditions set forth in this
Agreement, which both sides acknowledge and represent to be fair, reasonable,
adequate and in their mutual best interests.
NOW, THEREFORE, in consideration of the foregoing and the mutual
promises contained herein, it is agreed as follows:
1. NONRENEWAL AND EXTINGUISHMENT OF EMPLOYMENT AGREEMENT. Effective
December 31, 1999, Xxxxx'x Employment Agreement shall expire and shall not be
renewed by Anacomp. The parties agree that this Agreement supersedes the
Employment Agreement, and that the Employment Agreement shall be null and void
and of no further force and effect upon the execution of this Agreement by both
parties.
2. CONTINUING EMPLOYMENT. Effective October 8, 1999, Xxxxx shall have
no further job responsibilities. Through December 31, 1999, Xxxxx will serve in
a strategic advisory capacity to the President on the Manufacturing, Field
Services, Systems and Supplies businesses and on other projects at the
President's discretion. Anacomp agrees that Xxxxx will continue to have access
to corporate email, voicemail, and the Company's laptop computer in his
possession until December 31, 1999. Xxxxx will receive his current base salary
and cost of living differential as set forth in the Employment Agreement in
biweekly periods until December 31, 1999, and his FY1999 Fourth Quarter Bonus
will pay out normally.
3. FIRST QUARTER BONUS. Xxxxx shall be entitled to receive the FY2000
First Quarter Bonus based on the performance of the corporate goals, in
accordance with Anacomp's Executive Vice President Plan, with a target
compensation of $60,000.
4. VACATION PAY. Xxxxx will receive all earned but unused vacation pay
as of December 31, 1999.
5. OUTPLACEMENT. In consideration for entering into this Agreement,
Anacomp shall pay for outplacement services for six (6) months in the
Xxxxx-Xxxx-Xxxxx Executive Program for Xxxxx. In the event that Xxxxx is not
employed after six months, the Company will provide him with additional six (6)
months of the same outplacement services.
6. SEVERANCE.
6.1 SEVERANCE PAYMENTS. Anacomp shall pay Xxxxx a total of
$300,000 to be paid in biweekly installments over a 12-month period commencing
January 1, 2000 less normal payroll withholdings and taxes.
6.2 HEALTH COVERAGE AFTER JANUARY 1, 2000. Xxxxx shall
continue to receive the same Health Benefits from January 1, 2000 until December
31, 2000 that he received during the term of his Employment Agreement with
Anacomp or until such time as he secures health benefits with another employer.
6.3 NO EMPLOYEE BENEFITS AFTER JANUARY 1, 2000. Xxxxx shall
not be entitled to receive any standard Anacomp employee benefits (aside from
the Health Coverage) after January 1, 2000, including but not limited to
vacation, sick leave, life insurance, 401(k) and disability benefits.
7. AMENDMENT OF STOCK OPTION AND RESTRICTED STOCK AWARD.
7.1 VESTING. On January 5, 1998, Anacomp granted to Xxxxx a
non-qualified stock option (the "Option") to purchase 100,000 shares of
Anacomp's common stock at a price of $14.625 per share pursuant to Anacomp's
1996 Restructure Recognition Incentive Plan, which was evidenced by a form of
Non-Qualified Stock Option Agreement ("Option Agreement") between Anacomp and
Xxxxx dated February 19, 1998. The Option is hereby amended by this Agreement,
as follows: (a) Anacomp agrees to fully vest any unvested options effective
January 1, 2000, and (b) Xxxxx shall be required to exercise the Option no later
than March 31, 2001. Exercise of the Option shall be subject to section 7.3 of
this Agreement.
7.2 RESTRICTED STOCK. Anacomp agrees to provide Xxxxx with the
final award of 10,000 shares of restricted stock under the Employment Agreement
on January 1, 2000.
7.3 SALE OF ANACOMP SHARES. Notwithstanding any provision of
the Option Agreement to the contrary, Xxxxx may not sell more than five thousand
(5,000) shares of Anacomp stock acquired pursuant to the Option Agreement or
Restricted Stock under his Employment Agreement on any day without obtaining the
prior consent of the President or Chief Financial Officer of Anacomp.
7.4 ALL OTHER TERMS. Except as set forth in this Agreement,
all other terms and conditions of the Option Agreement shall remain in full
force and effect.
8. AGREEMENT NOT TO SOLICIT EMPLOYEES. Xxxxx agrees that for a two
(2) year period following the date of the execution of this Agreement, he
will not:
(a) Induce or attempt to induce, any employee of
Anacomp to leave employment with Anacomp;
(b) Interfere with or disrupt Anacomp's relationship
with any of its employees, consultants, customers, suppliers or vendors; or
(c) Solicit any employee of Anacomp to come to
work for Xxxxx or Xxxxx'x subsequent employer(s). Nothing in this Section
shall prohibit Xxxxx from conversing with employees or providing career
counseling to employees in the future.
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9. XXXXX'X GENERAL RELEASE OF ALL CLAIMS. In consideration for the
promises contained in this Agreement, Xxxxx hereby unconditionally, irrevocably
and absolutely releases and discharges Anacomp and its directors, officers,
employees, agents, successors and assigns and any related entities or businesses
(all of whom are referred to herein as "Releasees") from any and all claims
related in any way to the transactions, affairs or occurrences between them to
date, including but not limited to all losses, liabilities, claims, charges,
demands and causes of action, known or unknown, suspected or unsuspected,
arising directly or indirectly out of or in any way connected with Xxxxx'x
employment with Anacomp, the Employment Agreement, or his tenure as Executive
Vice President of Anacomp.
This Release is intended to have the broadest possible application and
includes, but is not limited to, any claim for severance pay, unpaid salary,
bonuses, stock options, salary continuation payouts or other benefits, breach of
contract, wrongful termination, tortuous discharge, defamation, infliction of
emotional distress, violation of privacy, fraud, conspiracy, loss of consortium,
shareholder derivative claims, wrongful termination in violation of public
policy, retaliation, negligence, harassment or employment discrimination arising
under federal, state or local law, including the California Fair Employment and
Housing Act, Title VII of the Civil Rights Act of 1964, and the Age
Discrimination in Employment Act of 1967, as amended.
Xxxxx acknowledges that he may discover facts or law different from, or
in addition to, the facts or law that he knows or believes to be true with
respect to the claims released in this Agreement, and agrees, nonetheless, that
this Agreement and the release contained in it shall be and remain effective in
all respects notwithstanding such different or additional facts or the discovery
of them.
Xxxxx declares and represents that he is executing this Agreement with
the opportunity to obtain full advice from his legal counsel, and that he
intends this Agreement shall be complete and shall not be subject to any claim
of mistake, and that the release herein expresses the full and complete release,
and regardless of the adequacy or inadequacy of the consideration, he intends
the release herein to be final and complete. Xxxxx executes this release with
the full knowledge that this release covers all possible claims against
Releasees.
10. OLDER WORKERS BENEFIT PROTECTION ACT REQUIREMENTS. This Agreement
is intended by the parties to release and discharge any and all claims of Xxxxx
against Anacomp, including, but not limited to, any claims arising under the Age
Discrimination in Employment Act (29 U.S.C. section 621 et seq.). It is the
intent of Xxxxx and Anacomp that this Agreement satisfy the requirements of the
Older Workers Benefit Protection Act (29 U.S.C. section 626(f)). The following
general provisions, along with the other provisions of this Agreement, are
agreed to for this purpose:
10.1 Xxxxx acknowledges and agrees that he has read and
understands the terms of this Agreement.
10.2 Xxxxx acknowledges that he has been given a full
opportunity to consult with a lawyer with respect to the matters referenced in
this Agreement, and that Xxxxx has obtained and considered such legal counsel as
he deems necessary, such that Xxxxx is entering into this Agreement freely,
knowingly and voluntarily.
10.3 Xxxxx acknowledges that he has been given at least
twenty-one (21) days in which to consider whether or not to enter into this
Agreement. If Xxxxx elects to sign the Agreement in a period shorter than 21
days, he does so at his sole option.
10.4 As to the waiver of any claim under the Age
Discrimination in Employment Act ("ADEA"), Xxxxx shall have seven (7) days after
the execution of this Agreement in which to revoke the
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Agreement as to any ADEA claim only. If Xxxxx does so revoke, he forfeits any
further compensation to be paid under this Agreement. In order to revoke this
Agreement within the seven-day period after its execution, Xxxxx must deliver
a written letter of revocation to the president of Anacomp.
11. CALIFORNIA CIVIL CODE SECTION 1542 WAIVER.
California Civil Code section 1542 states:
A general release does not extend to claims which the creditor
does not know of 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.
Xxxxx acknowledges that he has read the releases contained in
paragraphs 9 and 10 of this Agreement and the above Civil Code section, and that
he fully understands the releases and the Civil Code section. Xxxxx expressly
waives any benefits and rights granted to him pursuant to Civil Code section
1542.
12. ANACOMP'S GENERAL RELEASE OF ALL CLAIMS. In consideration for the
promises contained in this Agreement, and except as set forth below, Anacomp
hereby unconditionally, irrevocably and absolutely releases and discharges
Xxxxx, his executors, administrators and heirs ("Releasees") from any and all
claims related in any way to the transactions, affairs or occurrences between
them to date, including, but not limited to, all losses, liabilities, claims,
charges, demands and causes of action, known or unknown, suspected or
unsuspected, arising directly or indirectly out of or in any way connected with
Xxxxx'x prior employment with Anacomp.
Anacomp acknowledges that it may discover facts or law different from,
or in addition to, the facts or law that it knows or believes to be true with
respect to the claims released in this Agreement, and agrees, nonetheless, that
this Agreement and the release contained in it shall be and remain effective in
all respects notwithstanding such different or additional facts or discovery of
them.
Anacomp declares and represents that it is executing this Agreement
with the opportunity to obtain full advice from legal counsel, and that it
intends that this Agreement shall be complete and shall not be subject to any
claim of mistake, and that the release herein expresses the full and complete
release, and regardless of the adequacy or inadequacy of the consideration, it
intends the release herein to be final and complete. Anacomp executes this
release with the full knowledge that this release covers all possible claims
against Releasees.
California Civil Code Section 1542 states:
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.
Anacomp acknowledges that it has read the releases contained in this
Section 12, and the above Civil Code section, and that it understands both the
release and the Civil Code section. Anacomp expressly waives any benefits and
rights granted to it pursuant to Civil Code Section 1542. Notwithstanding
anything herein set forth to the contrary, no provision of this Section 12 shall
constitute or be construed as a release or discharge of any obligations, claims
or causes of action hereafter arising
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out of the breach of any of the terms, provisions or conditions of this
Agreement, the Stock Option Agreement, or the Confidentiality Agreement.
13. PROMISE NOT TO PROSECUTE. Xxxxx agrees that he will not prosecute,
nor allow to be prosecuted on his behalf, in any administrative agency, whether
state or federal, or in any court, whether state or federal, any claim or demand
of any type related to the matters released above, it being the intention of the
parties that with the execution of this release, Anacomp (as defined expansively
above) will be absolutely, unconditionally and forever discharged of and from
all obligations to or on behalf of Xxxxx related in any way to the matters
discharged herein.
14. CONFIDENTIALITY OF THIS AGREEMENT. Xxxxx agrees that the terms and
conditions of this Agreement and the underlying facts leading to the nonrenewal
of Xxxxx'x Employment Agreement shall remain confidential and that he shall not
disclose, directly or indirectly, any such terms, conditions, facts or
allegations, to any other person or entity except to his family members, tax
advisors and lawyers. Without limiting the generality of the foregoing, Xxxxx
will not respond to or in any way participate in or contribute to any public
discussion, notice or other publicity concerning, or in any way relating to, the
execution of this Agreement or the events that led to its execution. Without
limiting the generality of the foregoing, Xxxxx specifically agrees that he
shall not disclose information regarding this Agreement or the events that led
to the nonrenewal of his Employment Agreement, and any current, former or
prospective employees of Anacomp, and/or its suppliers, and/or its customers.
Xxxxx hereby agrees that disclosure by him of any of said terms, conditions,
facts or allegations, in violation of the foregoing, shall constitute and be
treated as a material breach of this Agreement.
15. AGREED-UPON STATEMENT. The parties will agree upon an acceptable
statement to inform Anacomp employees within the area of Xxxxx'x former
responsibilities of Xxxxx'x departure from the Company.
16. AGREEMENT TO RETURN ANACOMP PROPERTY AND INFORMATION. Xxxxx agrees
that on or about December 31, 2000, he shall return to Anacomp all property of
Anacomp including, but not limited to, his laptop computer, information stored
on his computer, financial information, product and pricing information,
customer lists, research and development plans, business plans, credit cards,
keys and computers.
17. AGREEMENT TO COMPLY WITH CONFIDENTIALITY AGREEMENT. Xxxxx
acknowledges that he is signatory to a "Confidentiality, Non-Competition and
Non-Disclosure Agreement" (herein "Confidentiality Agreement" attached as
Exhibit A to this Agreement) with Anacomp dated December 15, 1997. In exchange
for the consideration contained in this Agreement, Xxxxx agrees to continue to
fully comply with the terms of the Confidentiality Agreement.
18. NONDISPARAGEMENT. Xxxxx agrees that he will not make any
statements, written or verbal, disparaging the performance or business
reputation of Anacomp (including its officers, directors, employees, agents and
any related entities), or the personal or business reputation or character of
any employees of Anacomp to any customers, vendors or partners of Anacomp.
Anacomp agrees that it will not make any statements, written or verbal,
disparaging the performance or the personal or business reputation or character
of Xxxxx.
19. GENERAL PROVISIONS.
19.1 Xxxxx acknowledges that no promise has been made to him
that is not contained in this Agreement and the attachments hereto. Rather, this
Agreement and the attachments hereto (including the Stock Option Agreement and
the Confidentiality Agreement) constitute the entire
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agreement between Xxxxx and Anacomp. This Agreement may not be amended or
modified unless it is done so in a writing, signed by both Xxxxx and the
president of Anacomp.
19.2 The provisions of this Agreement are severable, and if
any one or more provisions may be determined to be judicially unenforceable, in
whole or in part, the remaining provisions shall nevertheless be binding and
enforceable.
19.3 In any action at law or equity between the parties
seeking enforcement of any of the terms and provisions of this Agreement or the
attachments hereto, the prevailing party in such action shall be awarded, in
addition to damages or other relief, its reasonable costs and expenses,
including, but not limited to, taxable costs and reasonable attorneys' fees.
Such recovery shall also include out-of-pocket expenses and attorneys' fees on
appeal, if any. The court shall determine the prevailing party, whether or not
the dispute or controversy proceeds to final judgment.
19.4 This Agreement shall be binding upon the parties hereto
and their representatives, successors, assigns and heirs, and shall inure to the
benefit of said parties and all other persons and entities released herein.
Xxxxx shall not be entitled to assign any of his rights or obligations under
this Agreement.
19.5 This Agreement shall be governed by the laws of the State
of California.
THE PARTIES TO THIS AGREEMENT, WITH THE FULL OPPORTUNITY TO OBTAIN THE
BENEFIT OF REPRESENTATION AND ADVICE OF COUNSEL, HAVE READ THE FOREGOING
AGREEMENT, AND FULLY UNDERSTAND EACH AND EVERY PROVISION CONTAINED HEREIN.
WHEREFORE, THE PARTIES HAVE EXECUTED THIS AGREEMENT ON THE DATES SHOWN BELOW.
IN WITNESS WHEREOF, the undersigned have executed this Agreement on the
dates shown below.
Dated:
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Xxxxxxxxx X. Xxxxx
ANACOMP, INC.
Dated: By:
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Xxxxxxx X. Xxxx
Senior Vice President and Chief
Administrative Officer
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