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EXHIBIT 10.38
[AFC LETTERHEAD]
CONFIDENTIAL
TERMINATION AGREEMENT AND GENERAL RELEASE
THIS TERMINATION AGREEMENT AND GENERAL RELEASE (the "AGREEMENT") is made
and entered into by and between Xxxxxx X. Xxxxxxx (the "Employee") and Advanced
Fibre Communications, Inc., its predecessors, successors, affiliates,
subsidiaries, employees, agents, officers, directors, etc., (the "Company").
The Employee and the Company enter into this Agreement for the purpose
of concluding and resolving all matters relating to the Employee's employment
with the Company, the terms and conditions of that employment, and the
termination of that employment.
The Employee acknowledges that he possesses sufficient education and
experience to fully understand the terms of this Agreement as it has been
written, the legal and binding effect of the Agreement, and the exchange of
benefits and payments for promises hereunder.
The Employee and the Company agree that the Company has no prior legal
obligation to make the payments which are exchanged for promises herein. The
Employee understands and agrees that the Company's obligation to perform under
this Agreement is conditioned upon the Employee's performance of all agreements,
releases and covenants to the Company as set forth herein.
In consideration of the promises and mutual promises herein, it is
agreed as follows:
1. The Employee served the Company at the will of the Company. This
Agreement shall not in any way be construed as an admission by the Company of
any alleged wrongful acts of any kind or nature whatsoever. This Agreement is
not an admission of liability, and furthermore, the Company specifically
disclaims any liability or wrongdoing whatsoever.
2. The Employee's termination date will be September 30, 1997.
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3. The Company agrees that Employee will receive regular bi-weekly
payments of $7,192.30 through July 20, 1998 for a total of $155,353.68, minus
lawful taxes and withholding. Employee will also receive a pro-rata portion of
the year-end bonus provided by the Company, based on services rendered from
January 1, 1997 through July 20, 1997.
4. The Company agrees to conditional continued vesting of certain of
Employee's unvested stock options through July 20, 1998 (see Attachment A of the
Exhibit A). The options that will continue to vest, however, will not be
exercisable until July 20, 1998 provided Employee has complied with all
provisions of this Agreement and of the consulting agreement attached hereto as
Exhibit A. In the event Employee breaches any terms of this Agreement or Exhibit
A, the payments referred to in paragraph 3 will cease, and the additional
vesting referred to in this paragraph will be cancelled.
5. Employee agrees to enter into and comply with the consulting
agreement attached hereto as Exhibit A which is incorporated herein.
6. The payments made to, or on behalf of Employee, by the Company as
stated in paragraph 3 and 4 are not in the nature of severance pay and are
provided to the Employee on the basis of the specific facts and circumstances of
the Employee's situation and only in exchange for the mutual promises made in
this Agreement.
For and in consideration of these special payments and for other good
and valuable consideration paid by the Company, the receipt and sufficiency of
which is hereby acknowledged, the Employee does for himself, his heirs, personal
representatives, administrators and anyone claiming by or through him, forever
unconditionally and irrevocably release, acquit and discharge the Company and
all of its past and present directors, officers, supervisors, employees,
representatives, successors, assigns, subsidiaries, affiliates, benefit plans,
divisions and parent and insurers (hereinafter collectively "the Releasees")
from any and all claims and causes of action, suits, obligations, promises,
agreements, controversies, damages, debts and demands, liabilities and losses of
every kind, character, and nature, including third party claims for indemnity or
contribution, against the Company and any other cause of action ("claim" or
"claims") that the Employee has ever had or now has, now known or unknown, or
that any person or entity claiming through the Employee may have or claim to
have against the Releasees. This Agreement specifically, without limitation,
releases the Releasees from any and all obligations arising out of the
Employee's employment with the Company, including but not limited to claims for
tort, contract, wrongful termination, discrimination, under Title VII of the
Civil Rights Act of 1964 ("Title VII"), as amended, the California Fair
Employment and Housing Act, or the Age Discrimination in Employment Act ("ADEA")
or violation of any state or federal statute, and any other employment benefit
or compensation.
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7. The Employee represents that the Employee has not filed nor will he
file any complaint or charge against the Company with the Equal Opportunity
Commission ("EEOC"), the California Fair Employment and Housing Commission, the
Federal or California Department of Labor, or with any other local, state or
federal agency or court, that the Employee will not do so at any time hereafter,
and that if any such agency or court assumes jurisdiction of any complaint, the
Employee will request such agency or court to withdraw from the matter.
8. The Employee expressly waives and relinquishes any claims, rights and
benefits, whether actually known or not, including those afforded to him by
Title VII, the ADEA, the California Fair Employment and Housing Act, Section
1542 of the Civil Code of California, which is quoted below, or any other local,
state or federal acts dealing with employment discrimination.
CIVIL CODE SECTION 1542: "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."
9. The Employee shall return all Company property, including but not
limited to, keys, equipment, manuals, drawings, notes, etc. to the Company
immediately upon execution of this Agreement. In addition, any monies owed to
the Company by the Employee, whether with respect to loans, travel advances, or
otherwise, must be immediately repaid by the Employee. If the Employee has any
travel or business expenses which have not been submitted for approval, the
Employee will submit such items within two weeks following the date of this
Agreement.
10. This Agreement shall be binding upon the Employee and upon the
Employee's heirs, administrators, representatives, executors, successors and
assigns, and shall inure to the benefit of the Releasees.
11. The Employee represents that no inducements, statements or
representations have been made that are not set forth in this Agreement and that
he did not rely on any inducements, statements or representations not set forth
herein. The Employee further represents that he is of sound mind and body to
enter into this Agreement, he has had an opportunity and was encouraged to
discuss the legal significance and ramifications of this Agreement with his
independent attorneys if he so desired and he enters into this Agreement freely
and voluntarily. Moreover, the Employee understands he has seven (7) days to
revoke this Agreement and acknowledges he has received at least 21 days to
decide whether or not to accept this Agreement.
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12. The Employee will not disclose any confidential or proprietary
information acquired while an employee of the Company, nor will the Employee
make any disparaging remarks about the Company. Employee agrees to abide by the
terms of the Proprietary Information and Inventions Agreement executed on
February 5, 1996. Information acquired by Employee concerning litigation of any
kind involving the Company is considered confidential and/or proprietary
information and is within the scope of the prohibitions contained in this
paragraph and the Proprietary Information and Inventions Agreement. Further,
Employee agrees not encourage or solicit, directly, indirectly or through
others, any present or future AFC employee to leave the Company for any reason
for a period of two years from the date of execution of this Agreement.
13. The Employee shall not disclose the terms of this Agreement, or its
existence, to anyone other than his immediate family or professional advisors
and shall instruct them on the duty to maintain its confidentiality.
14. The Employee will cooperate with the Company to assure an orderly
transition of work responsibilities and covenants that he will not take any
action , or omit to act, to the detriment of Company or its operations. The
Employee agrees that during the period he continues to be employed, and
thereafter, at the Company's expense, he will assist the Company in any
litigation against the Company brought by third parties relating to the
Employee's work product, or the business of the Company, whether now pending or
brought in the future.
15. This Agreement constitutes the complete understanding between the
Employee and the Company with respect to the subject matter of the Agreement and
supersedes any prior or contemporaneous oral and/or written agreements or
representations, if any, between the parties. This Agreement may not be orally
amended, modified or changed and may be amended, modified or changed only by
written instrument or instruments signed by the Employee and the duly authorized
officers of the Company.
16. This Agreement is made and entered into in the State of California,
and shall in all respects be interpreted, enforced and governed, under the laws
of California. The language of all parts of this Agreement shall in all cases be
construed as a whole, according to its fair meaning, and not strictly for or
against any of the parties.
17. In the event the Employee breaches the agreements set forth in this
Agreement by making a claim or bringing an action of any kind against the
Company in violation of this Agreement, the Employee shall be required to pay
the Company's litigation costs (including attorney's fees) associated with
defending against such claim or action.
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18. Should any provision of this Agreement be declared or be determined
by any court to be illegal or invalid, the validity of the remaining parts,
terms or provisions shall not be affected thereby and said illegal or invalid
part, term or provision shall be deemed not to be a part of this Agreement.
19. As used in this Agreement, the singular or plural shall be deemed to
include the other whenever the context so indicates or requires.
PLEASE READ CAREFULLY. THIS TERMINATION AGREEMENT
AND GENERAL RELEASE INCLUDES A RELEASE OF ALL KNOWN AND
UNKNOWN CLAIMS.
BY EXECUTING THIS AGREEMENT BELOW, EMPLOYEE
ACKNOWLEDGES
THAT HE HAS READ THIS TERMINATION AGREEMENT AND GENERAL
RELEASE
AND THAT HE WAS GIVEN TWENTY ONE (21) DAYS TO CONSIDER ITS
TERMS AND
HAS ENTERED INTO THIS AGREEMENT FREELY AND VOLUNTARILY.
Executed at Cupertino, California, this 22ND day of December, 1997
/s/ XXXXXX X. XXXXXXX
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Xxxxxx X. Xxxxxxx
Executed at Petaluma, California, this ___ day of __________, 1997.
ADVANCED FIBRE COMMUNICATIONS, INC.
BY: /s/ XXXX XXXXXXX
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Xxxx Xxxxxxx
President and CEO
