Exhibit 99.1
SEPARATION AND RELEASE AGREEMENT
THIS SEPARATION AND RELEASE AGREEMENT (the "Agreement") is entered into on
December 2, 2005 by and between Xxxxxxx X. Xxxxxxxxxx (the "Employee") and 21st
Century Holding Company, a Florida corporation (the "Company").
WITNESSETH:
WHEREAS, the Employee was employed by the Company as its Chief Executive
Officer pursuant to an employment agreement dated June 10, 2003, as amended by a
unanimous written consent of the Board dated August 9, 2005 (collectively, the
"Employment Agreement");
WHEREAS, the Company and the Employee have mutually decided that the
Employee will resign pursuant to the terms and conditions contained herein;
WHEREAS, the parties hereto desire to put to rest and settle all matters
between them related to or arising out of Employee's employment with, and
resignation from, the Company and the facts and circumstances underlying the
same, and to settle and compromise any and all claims and differences between
them, of any sort, origin or description in order to avoid the costs and
uncertainties inherent in possible future litigation.
NOW, THEREFORE, Employee and the Company, intending to be legally bound
hereby and in consideration of the promises contained herein, do hereby agree as
follows:
1. RESIGNATION. The Employee acknowledges that he resigned, effective as
of November 10, 2005 (the "Resignation Date") as (i) the Company's Chief
Executive Officer and from any other positions that he held with the Company,
(ii) as a director of the Company and from (iii) any other positions that he
held with the Company or any of its subsidiaries.
Notwithstanding the foregoing, during the time period (the "Interim
Period") between the Resignation Date and December 2, 2005 (the "Termination
Date"), the Employee agrees that he will remain as a salaried employee of the
Company to assist the Company in its transition process to a new Chief Executive
Officer. The Employee acknowledges and agrees that he will not have the
authority to represent or bind the Company or any of its subsidiaries during
this Interim Period and he will not take any actions to represent the Company
during this Interim Period, included, but not limited to signing documents on
behalf of the Company or talking to investors (except family members who are
investors) or customers. Effective as of December 2, 2005, the Employee will no
longer be an employee of the Company.
2. TERMINATION OF EMPLOYMENT AGREEMENT AND OPTIONS.
2.1 Employee acknowledges and agrees that this Agreement shall serve
to terminate his Employment Agreement and that this Agreement sets forth all the
compensation that is payable to him, effective as of the date of this Agreement.
2.2 The Employee agrees that he will have until December 2, 2005
("Option Termination Date') to exercise any vested options ("Vested Options")
that have been granted to him by the Company during his term of his employment
with the Company. The Employee acknowledges and agrees that the only Vested
Options that he owns as of the date of this Agreement are as follows: options to
purchase 15,000 shares of the Company's common stock at an exercise price of
$6.6670 per share and options to purchase 75,000 shares at an exercise price of
$8.3330 per share. The Employee agrees that any of the Vested Options, listed in
this Section 2.2, which the Employee has not exercised by the Option Termination
Date, will be deemed to be cancelled, null and void at the end of the business
day on the Option Termination Date. The Employee also acknowledges and agrees
that he does not own any unvested options to purchase shares of the Company's
common stock as of the date of this Agreement.
2.3 The Company and the Employee acknowledge the termination of the
Employment Agreement and the survival and incorporation by reference herein of
the provisions, terms and conditions set forth in Sections 7.1, 7.2, 7.3, 7.4
and 8 of the Employment Agreement for a period of one year after the date of
this Agreement.
2.4 The Employee acknowledges and agrees that he is resigning for
personal reasons and does not have any disputes or disagreements with the
Company or its Board of Directors. The Employee represents that the Company's
filings with the Securities and Exchange Commission and all press releases filed
or issued during his tenure as an executive officer of the Company accurately
described the Company's business and financial condition in all material
respects and to the best of the Employee's knowledge were true and correct in
all material respects to the best of his knowledge.
3. SEVERANCE PAYMENTS.
3.1 BENEFITS. The Company will provide the Employee with information
regarding any benefits which may be converted to individual coverage and/or
coverage which includes his spouse in accordance with Consolidated Omnibus
Budget Reconciliation Act (COBRA) regulations. Employee acknowledges and agrees
that he will not be entitled to any perquisites, benefits or other compensation
whatsoever after the Termination Date, except as described in this Agreement.
3.2 AMOUNTS STATED BEFORE TAXES. All amounts stated in this
Agreement are prior to any deduction for applicable withholding taxes and other
amounts that are required to be withheld or deducted by federal and Florida law.
4. WAIVER AND RELEASE. For good and valuable consideration, the receipt
and sufficiency of which is acknowledged by the Employee, the Employee hereby
agrees that regardless of who assumes his duties, his separation of employment
from the Company was not due in any way to age or any other type of
discrimination or any wrongful act of the Company, and Employee and his
Releasors do hereby voluntarily and fully release and forever discharge the
Company, together with its past and current predecessors, successors,
shareholders, officers, directors, employees, attorneys, trustees, insurers,
representatives, contractors, subsidiaries, related organizations and affiliates
(collectively, the "Released Parties"), jointly and individually, from any and
all claims, demands, debts, causes of action, claims for relief, and damages, of
whatever kind or nature, known or unknown, developed or undeveloped, which
Employee had, now has or may hereinafter have from the beginning of the world to
the date of this Agreement, including, without limitation, all claims and all
rights which the Employee may have under Title VII of the Civil Rights Act of
1964; the Equal Employment Opportunity Act of 1972; the Civil Rights Act of
1991; the Age Discrimination and Employment Act of 1967; the Employee Retirement
Security Act 42 U.S.C. ss. 1981; the Older Workers' Benefit Protection Act; the
Americans with Disabilities Act; the Family Medical Leave Act of 1993; the Equal
Pay Act; the Fair Labor Standards Act; the Broward County Equal Opportunity
Ordinance; any federal or state whistleblower acts and any and all other
federal, state and local laws and statutes which regulate employment; and the
laws of contracts, tort and other subjects. The Employee agrees that the
forgoing enumeration of claims released is illustrative, and the claims hereby
released are in no way limited by the above recitation of specific claims, it
being the intent of the Employee to fully and completely release all claims
whatsoever in any way relating to the Employee's employment with the Company and
to the termination of such employment.
5. RELEASED PARTIES AND NO ADMISSION OF LIABILITY. For purposed of
paragraph 4, "Releasors" shall mean, collectively, the spouse of the Employee
and the Employee's dependents, heirs, executors administrators and assigns, past
and present and each of them and their trustees, directors, officers, agents,
attorneys, insurers, employees, stockholders, representatives, successors,
assigns and all persons acting by, through, under or in connection with them,
past and present. The Employee further agrees that the definition of Released
Parties contained in Section 4 of this Agreement shall be broadly construed and
it expressly includes, without limitation, all current and former: officers,
directors, employees, shareholders, attorneys, trustees, insurers,
representatives and contractors of the Company, its subsidiaries and affiliated
entities, in addition to the other persons and entities referred to in Section 4
hereof. Execution of this Agreement does not constitute an admission by any of
the Released Parties of any violation of any civil rights or other employment
discrimination statute, or any other legal statute, provision, regulation,
ordinance, order or action under common law. Rather, this Agreement expresses
the intention of the parties to resolve all issues and other claims related to
or arising out of Employee's employment by the Company without the time and
expense of litigation.
6. GOVERNING LAW. The law of the State of Florida shall govern the
validity of this Agreement, the construction of its terms and the interpretation
of the rights and duties of the parties. This Agreement constitutes the entire
agreement and understanding between the Employee and the Company regarding the
Employee's resignation from employment with the Company. This Agreement totally
replaces and supercedes any and all prior agreements, arrangements,
representations and understandings between the Employee and the Company,
including but not limited to the Employment Agreement and agreements in which
the Employee was granted options to purchase the Company's common stock, except
for certain sections of the Employment Agreement which have been incorporated
herein by reference. Any agreement to amend or modify the terms and conditions
of this Agreement must be in writing and executed by the parties hereto. This
Agreement may be specifically enforced in judicial proceedings and may be used
as evidence in a subsequent proceeding in which a breach is alleged. Headings
are for convenience only and should not be used in interpreting this Agreement.
7. NON DISPARAGING REMARKS. The Employee agrees that he will not directly
or indirectly, individually or in concert with others for a period of five years
from the date of this Agreement, (i) disparage, interfere with or attempt to
interfere with, the Company's reputation, goodwill, services, business and/or
the Company's stockholders, directors, officers, employees, agents,
representatives and any affiliates or (ii) engage in any conduct, take any
actions or make any statements (oral or written) to the public, future
employers, customers, vendors, the investment community, the media, current,
former or future Company employees, or any other third party whatsoever that is
calculated to have, or reasonably likely or possibly having, the effect of
undermining, disparaging or otherwise reflecting negatively or could reasonably
be considered to undermine, disparage or reflect negatively, on the Company, its
reputation, goodwill, services, business and/or stockholders, directors,
officers, employees, agents, representatives and its affiliates. During a five
year period after the date of this Agreement, the Company agrees that it will
not slander the Employee. The Company will be permitted to make any and all
factual disclosures that are required by any applicable law. Similarly, the
Employee shall also be permitted to make any and all factual disclosures that
are required by any applicable laws.
8. KNOWING AND VOLUNTARY SETTLEMENT.
8.1 BECAUSE THE EMPLOYEE IS OVER FORTY (40) YEARS OF AGE, HE HAS
SPECIFIC RIGHTS UNDER THE OLDER WORKERS BENEFITS PROTECTION ACT ("OWBPA") WHICH
PROHIBITS DISCRIMINATION ON THE BASIS OF AGE, AND HE ACKNOWLEDGES THAT THE
RELEASES SET FORTH IN THIS AGREEMENT ARE INTENDED TO RELEASE ANY RIGHT THAT THE
EMPLOYEE MAY HAVE TO FILE A CLAIM AGAINST THE COMPANY ON THE BASIS OF AGE.
8.2 IN EXECUTING THIS AGREEMENT, THE EMPLOYEE HEREBY REPRESENTS THAT
HE HAS BEEN AFFORDED A REASONABLE OPPORTUNITY TO CONSIDER THIS AGREEMENT; THAT
HE HAS COMPLETELY AND CAREFULLY READ THIS AGREEMENT; THAT HE HAS BEEN ADVISED BY
THE COMPANY TO CONSULT WITH AN ATTORNEY OF HIS OWN CHOICE PRIOR TO EXECUTING
THIS AGREEMENT, AND RELIED ON THE LEGAL ADVICE OF HIS ATTORNEY, IF HE ELECTED TO
RETAIN AN ATTORNEY; THAT HE HAD THE OPPORTUNITY TO HAVE AN ATTORNEY EXPLAIN TO
HIM THE TERMS OF THIS AGREEMENT WHICH HE RECEIVED WHEN THE COMPANY ADVISED HIM
TO RETAIN HIS OWN SEPARATE LEGAL COUNSEL; THAT HE KNOWS AND UNDERSTANDS THE
CONTENTS OF THIS AGREEMENT; THAT THE TERMS OF THIS AGREEMENT ARE TOTALLY
SATISFACTORY TO AND FULLY UNDERSTOOD AND VOLUNTARILY ACCEPTED BY HIM. THE
EMPLOYEE ALSO AGREES THAT HE HAS BEEN PROVIDED WITH AT LEAST TWENTY-ONE (21)
DAYS TO CONSIDER THIS AGREEMENT AND VOLUNTARILY AGREES TO BE BOUND BY IT, AND
THAT HE UNDERSTANDS THAT HE MAY REVOKE THIS AGREEMENT WITHIN SEVEN DAYS AFTER
ITS EXECUTION AND THAT THIS AGREEMENT WILL NOT BECOME EFFECTIVE OR ENFORCEABLE
UNTIL THE EXPIRATION OF SEVEN DAYS AFTER ITS EXECUTION.
9. FUTURE COOPERATION. The Employee agrees to cooperate fully with the
Company in connection with any matter or even relating to his employment or
events that occurred during his employment, including, without limitation, in
the defense or prosecution of any claims or actions not in existence or which
may be brought or threatened in the future against the Company and any claims or
actions against its officers, directors and employees. The Employee's
cooperation in connection with such matters, actions and claims shall include,
without limitation, being available, after reasonable notice to meet with the
Company regarding matters in which the Employee was involved; to prepare for any
proceeding (including without limitation, depositions, consultations, discover
or trail); to provide affidavits; to assist with any audits or reviews of the
Company's financial statements; to assist with any legal proceeding or other
inquiry and to act as a witness in connection with any litigation or other legal
proceeding affecting the Company. The Employee shall be reimbursed for any
reasonable our-of-pocket expenses incurred in connection with providing such
cooperation under this Section 9. The Employee further agrees that should he be
contacted (directly or indirectly) by any person or entity adverse to the
Company, the Employee shall promptly notify an executive officer of the Company
in writing.
10. EFFECT OF SETTLEMENT, INTERPRETATION AND SCHEDULES. The Company and
Employee intend this Agreement to be legally binding upon and inure to the
benefit of each of them and their respective heirs, administrators, executors,
successors and assigns. The language of this Agreement shall be construed as a
whole, according to its fair meaning and intent and not strictly for or against
any party hereto, regardless of who drafted or was principally responsible for
drafting this Agreement. The recitals contained at the beginning of this
Agreement are expressly made a part of this Agreement. All Schedules identified
in this Agreement are incorporated herein by reference and made a part hereof.
11. ARBITRATION. Any dispute or controversy between the Company and the
Employee, whether arising out of or relating to this Agreement, the breach of
this Agreement, or otherwise, shall be settled by arbitration in Florida
administered by the American Arbitration Association, with any such dispute or
controversy arising under this Agreement being so administered in accordance
with its Commercial Rules then in effect, and judgment on the award rendered by
the arbitrator may be entered in any court having jurisdiction thereof. The
arbitrator shall have the authority to award any remedy or relief that a court
of competent jurisdiction could order or grant, including, without limitation,
the issuance of an injunction. However, either party may, without inconsistency
with this arbitration provision, apply to any court having jurisdiction over
such dispute or controversy and seek interim provisional, injunctive or other
equitable relief until the arbitration award is rendered or the controversy is
otherwise resolved. Except as necessary in court proceedings to enforce this
arbitration provision or an award rendered hereunder, or to obtain interim
relief, neither a party nor an arbitrator may disclose the existence, content or
results of any arbitration hereunder without the prior written consent of the
Company. The parties agree that any arbitration proceedings shall be held in
Broward County, Florida, unless mutually agreed by both parties in writing.
12. ENFORCEMENT.
12.1 The Employee agrees that the Company, its subsidiaries and
affiliated parties, would be damaged irreparably in the event that any provision
of this Agreement were not performed in accordance with its terms or were
otherwise breached and that money damages would be an inadequate remedy for any
such nonperformance or breach. Accordingly, the Company and its successors and
permitted assigns shall be entitled, in addition to other rights and remedies
existing in their favor, to an injunction or injunctions to prevent any breach
or threatened breach of any of such provisions and to enforce such provisions
specifically (without posting a bond or other security). The Employee agrees
that he will submit himself to the personal jurisdiction of the courts of the
State of Florida in Broward County or any other applicable court in any action
by the Company to enforce an arbitration award against him or to obtain interim
injunctive or other relief pending an arbitration decision.
12.2 The Employee acknowledges and agrees that in the event that he
breaches any of the provisions of this Agreement or has made any false
representations to the Company, the Company will be (i) entitled to apply for
and receive an injunction to restrain any violation of this Agreement and (ii)
the Employee will be obligated to pay the Company its costs and expenses in
obtaining such injunction and/or enforcing this Agreement (including, but not
limited to courts costs, expenses and reasonable legal fees) and the foregoing
shall in affect the validity of this Agreement and such relief does not
constitute in any way a penalty or forfeiture.
13. SEVERABILITY AND WAIVER OF JURY TRAIL. Should any provision of this
Agreement be declared illegal or unenforceable by any court of competent
jurisdiction and cannot be modified to be enforceable, including the general
release language, such provision shall immediately become null and void, leaving
the remainder of the Agreement in full force and effect.. The Company and the
Employee each knowingly, intentionally, and irrevocably waive any and all rights
to a jury trial for any litigation or legal proceeding in any way relating to or
arising out of this Agreement or the Employment Agreement.
[Signatures on following page]
IN WITNESS WHEREOF, the aforesaid parties have hereunto set their hands and
seals as of the day below written.
21st Century Holding Company
By: /s/ Xxxxxx X. Xxxxxx
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/s/ Xxxxxxx X. Xxxxxxxxxx
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Xxxxxxx X. Xxxxxxxxxx
