SEPARATION AGREEMENT AND GENERAL RELEASE
Exhibit
10.1
SEPARATION AGREEMENT AND
GENERAL RELEASE
This
SEPARATION AGREEMENT AND
GENERAL RELEASE (“Agreement”) is made as of this 18th day of
June 2009 by and between MEDIALINK WORLDWIDE INCORPORATED, a Delaware
corporation, having an address at 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
(“Medialink”), and XXXXXXXX XXXXXXXXX, an individual residing at 00 Xxxxxxxx
Xxxx, Xxxxxxxxx, Xxxxxxxxxxx 00000 (“Xxxxxxxxx”).
NOW, THEREFORE, in
consideration of the mutual promises and covenants hereinafter set forth, the
parties agree as follows:
1. This
Agreement shall be deemed effective (the “Effective Date”) upon the execution
date of that certain agreement and plan of merger (the “Merger Agreement”)
between Medialink, The NewsMarket, Inc. (“TNM”) and a wholly owned subsidiary of
TNM (the “Merger Partner”); provided, however, that in the event that the
proposed merger transaction (the “Merger”) pursuant to the Merger Agreement is
not consummated by December 31, 2009, then this Agreement shall be null and void
and of no force and effect.
2. Xxxxxxxxx
and Medialink are parties to that certain Amended and Restated Employment
Agreement dated as of December 31, 2005 (the “Employment Agreement”) pursuant to
which Xxxxxxxxx performed duties as the Chairman, President and Chief Executive
Officer of Medialink. Certain terms of the Employment Agreement,
including without limitation, Sections 4.2, 4.4, 5.3-5.6, 8.1-8.3, 10.1 and 12
are expressly modified by the terms of this Agreement. Xxxxxxxxx’x
employment relationship with Medialink will be deemed (with no further action
required by Medialink) terminated by Medialink effective as of the date on which
the Merger becomes effective (the “Termination Date”). The
termination of Xxxxxxxxx’x employment hereunder shall not be deemed a For Cause
termination, as such term is defined in the Employment
Agreement. Xxxxxxxxx hereby resigns from Medialink’s Board of
Directors effective as of the Termination Date. Nothing herein shall
be deemed to affect Xxxxxxxxx’x compensation or benefits prior to the
Termination Date.
3. Xxxxxxxxx
acknowledges that he fully understands the terms and implications of this
Agreement. Xxxxxxxxx has carefully considered other alternatives to
executing this Agreement and has decided that he will execute this
Agreement.
4. Xxxxxxxxx
understands that he will have up to twenty-one (21) days from the date hereof to
review and execute this Agreement and that he shall have the right, within seven
(7) days after his execution of this Agreement, to revoke same unless such right
is waived by Xxxxxxxxx. If and to the extent Xxxxxxxxx executes this
Agreement prior to the expiration of the twenty-one (21) day period referred to
above, Xxxxxxxxx represents and warrants to Medialink that he has done so
knowingly and voluntarily.
5. Xxxxxxxxx
further recognizes that he executes this Agreement voluntarily and that
Medialink requires that he discuss the same with his legal advisors to ensure
full and thorough knowledge of the legal significance of this
Agreement. Medialink agrees to reimburse Xxxxxxxxx for all reasonable
legal fees incurred in the review of this Agreement, up to a maximum
reimbursement of $1,500. Xxxxxxxxx has been represented by Xxxxxxx
Xxxxxx & Green, P.C., in his review and consideration of this
Agreement.
6. (a) In
lieu and in place of any payments or benefits otherwise due Xxxxxxxxx under
Sections 4.2, 4.4, 5.3-5.6, 8.1-8.3 and 10.1 of the Employment Agreement and in
consideration for Xxxxxxxxx signing and adhering to the terms and conditions of
this Agreement, Xxxxxxxxx will receive the gross amount of Four Hundred
Forty-Four Thousand ($444,000) Dollars, subject to downward adjustment as set
forth below, which amount shall be reduced by all applicable deductions as shall
be required to be withheld by applicable law and regulation (the “Severance
Payment”). Such Severance Payment will be payable in one lump sum no
later than fifteen (15) business days after the Termination Date and shall not
be offset by any amounts Xxxxxxxxx earns or could have earned with reasonable
diligence after the Termination Date. Xxxxxxxxx expressly releases
Medialink from making any payments or making any benefits available pursuant to
Sections 4.2, 4.4, 5.3-5.6, 8.1-8.3 and 10.1 of the Employment
Agreement.
(b) The amount
of the Severance Payment referenced above is subject to downward adjustment
based on Medialink’s Adjusted Cash Balance as of the closing of the Merger (the
“Closing”). For purposes of this calculation, Adjusted Cash Balance
means the sum of (A) the actual cash available at the Closing (after payment or
accrual of Medialink’s transaction costs associated with the Merger) (i) prior
to payment of (x) contractual and non-contractual severance obligations
(including the Severance Payment) and (y) 2009 board of directors’ fees, and
(ii) adjusted, upward or downward for the Working Capital Adjustment (as such
term is defined in the Merger Agreement) and (B) the amount of severance
obligations assumed by the Merger Partner pursuant to the Merger
Agreement. The amount of the Severance Payment shall be adjusted as
follows:
(i) If
the Adjusted Cash Balance is at least equal to $1,390,000, there shall be no
adjustment to the amount of the Severance Payment;
(ii) If
the Adjusted Cash Balance is at least equal to $1,126,000 but less than
$1,390,000, then the Severance Payment shall be reduced by an amount equal to
the product of (A) 0.45 and (B) the amount by which the actual Adjusted Cash
Balance falls short of $1,390,000; or
(iii) If
the Adjusted Cash Balance is less than $1,126,000, then the Severance Payment
shall be reduced by an amount equal to the sum of (A) $119,000 and (B) the
product of (x) 0.342 and (y) the amount by which the actual Adjusted Cash
Balance falls short of $1,126,000.
For
purposes of clarification, an adjustment shall be made pursuant to only one of
Sections 6(b)(ii) or 6(b)(iii) above, but not both.
(c) Xxxxxxxxx
and Medialink agree that notwithstanding anything to the contrary herein, in the
event that during the period between the Effective Date and the Termination
Date, Xxxxxxxxx dies or suffers a Disability (as such term is defined in Section
6.1 of the Employment Agreement), then Xxxxxxxxx (or his estate, as the case may
be) shall be entitled to receive from Medialink the benefits set forth in
Sections 5.4 (upon death) or 5.5 (upon a Disability) of the Employment Agreement
until the Termination Date, and from and after the Termination Date, if any,
Xxxxxxxxx (or his estate, as the case may be) shall receive, in lieu of such
benefits, the payment set forth in Section 6(a), as adjusted by Section 6(b) of
this Agreement.
7. The
Company agrees to pay and Xxxxxxxxx acknowledges that he will have been paid his
accrued and unpaid salary and bonus through the Termination Date and is not
entitled to any further payments for same. Xxxxxxxxx further
acknowledges that he will not be entitled to participate in any of Medialink’s
benefit plans after the Termination Date; provided, however, that Xxxxxxxxx may
continue to participate in Medialink’s hospitalization and group health benefit
plans pursuant to the Consolidated Omnibus Budget Reconciliation Act (COBRA) at
Xxxxxxxxx’x sole cost and expense, unless otherwise provided by
law.
8. As
a condition to Xxxxxxxxx receiving the Severance Payment referenced above and as
a material inducement for Medialink to enter into this Agreement:
(a) Xxxxxxxxx
agrees to be available to Medialink for telephone consultations for up to thirty
(30) days after the Termination Date. In no event shall Xxxxxxxxx be
required to be available for more than an aggregate of ten (10) hours during
such period.
(b) Xxxxxxxxx
agrees that on the Termination Date, Xxxxxxxxx shall deliver all Medialink
Property, as hereinafter defined, in his custody or possession to Medialink or
its representatives, and Xxxxxxxxx represents and warrants that no such
Medialink Property or copies thereof have been knowingly retained by him, any of
his representatives or any person, firm or corporation owned or controlled by
him or delivered to any third party other than in the normal course of
performing his duties pursuant to the Employment Agreement. The term
“Medialink Property” as used herein means any and all confidential or
proprietary materials belonging to Medialink that are in Xxxxxxxxx’x possession,
including but not limited to books, records, files, documents, accounting or
financial records, statements, reports, equipment, computer hardware, computer
software, programs, contact lists, customer data and files (hardcopies and
electronic), any proprietary information or data of Medialink in any format and
any and all copies thereof, hard drives, keys to Xxxxxxxxx’x offices and files,
computer passwords provided by Medialink to Xxxxxxxxx, passwords established by
Xxxxxxxxx on Medialink hardware and passwords established by Xxxxxxxxx on any
file containing Medialink information. Notwithstanding the foregoing,
Xxxxxxxxx shall be permitted, at his sole option, to retain the cell phone and
phone number, pda/BlackBerry, laptop computer with one docking station and one
monitor that were used by Xxxxxxxxx immediately prior to the Termination Date;
provided however, that all Medialink Property must be removed from each item
retained, and each retained item shall be subject to prompt review and
modification by Medialink’s IT personnel to ensure that all Medialink Property
has been permanently removed therefrom. In addition, the laptop
computer, if any, retained by Xxxxxxxxx shall be reformatted by Medialink’s
personnel; provided, however, that Medialink will reload standard software
(including, but not limited to, Microsoft Office and Adobe Acrobat) on the
retained laptop computer and, to the extent reasonably practicable, provide
Xxxxxxxxx with the pertinent licenses, discs, and manuals related to such
reloaded software. After the Termination Date, Xxxxxxxxx, and not
Medialink, shall be responsible for any service fees associated with the use and
maintenance of any of the retained items.
(c) Xxxxxxxxx
acknowledges that the principal business of Medialink is providing video and
audio production and satellite and other distribution services to television and
radio stations and online news outlets for corporations and other organizations
seeking to communicate their news to the public (the
“Business”). Xxxxxxxxx acknowledges that he has acquired confidential
information concerning Medialink and the Business and that, among other things,
his knowledge of the Business was enhanced through his employment by Medialink.
Xxxxxxxxx acknowledges that such information is of great value to Medialink, is
the sole property of Medialink, and was acquired by him in
confidence.
(d) Xxxxxxxxx
hereby confirms that (i) the confidentiality and transfer of developments
obligations set forth in Section 11 of the Employment Agreement survive the
termination of Xxxxxxxxx’x employment and (ii) Xxxxxxxxx will abide by and
adhere to such obligations.
(e) The
Parties agree that the provisions of Section 12 of the Employment Agreement are
hereby waived and replaced by this Section 8(e). Xxxxxxxxx
acknowledges that it is reasonably necessary for the protection of Medialink
that Xxxxxxxxx agree, and, accordingly, Xxxxxxxxx does hereby agree, that for
the period ending on the nine (9) month anniversary of the Termination Date, he
will not, directly or indirectly:
i. engage
in the Business for his account or render any services that constitute engaging
in the Business, in any capacity to any entity; or become interested in any
entity engaged in the Business either on his own behalf or as an officer,
director, stockholder, partner, principal, consultant, associate, employee,
owner, agent, creditor, independent contractor, or co-venturer of any third
party or in any other relationship or capacity; or
ii. employ
or engage, or cause to authorize, directly or indirectly, to be employed or
engaged, for or on behalf of himself or any third party, any employee,
representative or agent of Medialink; or
iii. solicit,
directly or indirectly, on behalf of himself or any third party, any client or
vendor, for services competitive with the Business, of Medialink and its
affiliates; or
iv. have
an interest as an owner, lender, independent contractor, co-venturer, partner,
participant, associate or in any other capacity, render services to or
participate in the affairs of, any entity listed on Schedule A attached hereto
or any subsidiary or affiliate of such listed entity.
(f) The
provisions of Section 8(e) shall not be construed to prevent Xxxxxxxxx from
owning, directly or indirectly, in the aggregate, an amount not exceeding two
percent (2%) of the issued and outstanding voting securities of any class of any
corporation whose voting capital stock is traded on a national securities
exchange or in the over-the-counter market.
(g) Notwithstanding
anything to the contrary set forth in Section 8(e); (i) Xxxxxxxxx
shall not be prohibited from rendering services for news organizations, or
public relations departments or public relations
agencies; (ii) Xxxxxxxxx may act as a news reporter or
manager for an entity whose primary function is journalism; (iii) Xxxxxxxxx
may act as a member of the internal public relations staff of any
corporation or entity who performs services for only that corporation or its
affiliates, including parent corporations, subsidiaries, and joint ventures;
and/or (iv) Xxxxxxxxx may act as an account executive or manager at a
public relations agency directly serving that agency’s
clients. Notwithstanding the prior sentence, however, for the period
ending on the nine (9) month anniversary of the Termination Date, Xxxxxxxxx may
not, render services, directly or indirectly, (i) for any organization,
department, or affiliate of such news organizations, corporate public relations
departments, or public relations agencies, whose primary purpose is to provide
the production and distribution of video or audio news releases that are
competitive with, or substantially similar to, the Business.
(h) Xxxxxxxxx
agrees that upon Medialink’s request, he shall enter into a voting agreement
whereby Xxxxxxxxx will agree to vote his shares of Medialink stock (and all
shares under his control) in favor of the Merger. Xxxxxxxxx further agrees
that he shall support approval of the Merger.
(i) Xxxxxxxxx
agrees that any breach or threatened breach by him of Section 8 of this
Agreement shall entitle Medialink, in addition to all other legal remedies
available to it, to apply to any court of competent jurisdiction to seek to
enjoin such breach or threatened breach without posting a bond or showing
special damages. The parties understand and intend that each
restriction agreed to by Xxxxxxxxx hereinabove shall be construed as separable
and divisible from every other restriction, that the unenforceability of any
restriction shall not limit the enforceability, in whole or in part, of any
other restriction, and that one or more of all of such restrictions may be
enforced in whole or in part as the circumstances warrant. In the
event that any restriction in this Agreement is more restrictive than permitted
by law in the jurisdiction in which Medialink seeks enforcement thereof, such
restriction shall be limited to the extent permitted by law.
9. (a) Xxxxxxxxx
hereby stipulates, agrees, and understands that in consideration of the payments
set forth in Section 6 above, that being good and valuable consideration,
Xxxxxxxxx hereby acting of his own free will, voluntarily and on behalf of
himself, his heirs, administrators, executors, successors, and assigns, releases
Medialink, its subsidiaries, affiliates, directors, officers, members,
employees, attorneys, representatives, and agents and each of them and their
predecessors, successors and assigns (hereinafter “Medialink Parties”) from any
and all debts, obligations, claims, demands, judgments or causes of action of
any kind whatsoever in tort, contract, by statute, or on any other basis for
compensatory, punitive or any other damages, expenses, reimbursements or costs
of any kind, including but not limited to any and all claims, demands, rights,
and/or causes of action arising out of an alleged breach of the Employment
Agreement or relating to purported employment discrimination or violations such
as Civil Rights violations, including, but not limited to, those arising under
Title VII of the Civil Rights Act of 1964 (42 U.S.C. section 2000e, et seq.), the Civil
Rights Act of 1991, the Civil Rights Act of 1866 and 1871 (42 U.S.C. sections
1981 and 1983), Executive Order 11246 as amended, the Age Discrimination in
Employment Act of 1967 (29 U.S.C. section 621, et seq.), the Equal Pay
Act of 1963 (29 U.S.C. section 26(d)(1), the Rehabilitation Act of 1973 (29
U.S.C. section 701-794), the Americans with Disabilities Act (ADA), the New York
Human Rights Law, Exec. Law, CH. 118, Art. 15, section 290, et seq. or any other
applicable federal, state or local employment discrimination statute or
ordinance which Xxxxxxxxx might have or assert against any of the Medialink
Parties: (1) by reason of his employment relationship or dealings
with Medialink or the termination of said relationship and all circumstances
related thereto; or (2) by reason of any other matter, cause or thing
whatsoever, from the first date of employment to the date of execution of this
Agreement, except that the foregoing (i) does not affect the future right of
Xxxxxxxxx and/or any heir, administrator, executor, successor, and assign to
enforce the terms of this Agreement, and (ii) does not waive any vested benefits
under any welfare, pension or retirement benefit plan maintained by Medialink,
which shall be governed by the applicable plan or COBRA, as the case may
be.
(b) Medialink
hereby stipulates, agrees, and understands that in consideration of the
obligations undertaken herein by Xxxxxxxxx, that being good and valuable
consideration, Medialink, on behalf of itself and the Medialink Parties, hereby
releases Xxxxxxxxx from any and all debts, obligations, claims, demands,
judgments or causes of action of any kind whatsoever in tort, contract, by
statute, or on any other basis for compensatory, punitive or any other damages,
expenses, reimbursements or costs of any kind arising out of or related to any
fact, thing or matter which is known to Medialink as of the date of this
Agreement. The knowledge of Xxxxxxxxx shall not be imputed to
Medialink.
10. Xxxxxxxxx
agrees and understands that failure in any material respect to adhere to the
terms and conditions of this Agreement, including but not limited to the
provisions of Sections 8 and 9 of this Agreement, as well as any action
commenced by him against the Medialink Parties, other than to enforce the terms
of this Agreement, shall immediately void Medialink’s obligation to pay the
amounts set forth above, and any and all monies and/or benefits provided for
herein to Xxxxxxxxx and shall require immediate repayment by Xxxxxxxxx of the
value of all consideration paid or provided to Xxxxxxxxx by Medialink pursuant
to this Agreement. Further, in any action by one party hereof against
the other party to enforce the terms of this Agreement, the prevailing party
shall be entitled to reimbursement from the non-prevailing party for the
prevailing party’s reasonable costs and attorneys’ fees in defending or
prosecuting such action.
11. (a) Xxxxxxxxx
represents that he has not filed any lawsuits or demands for arbitration against
Medialink, or filed or caused to be filed any charges or complaints against
Medialink with any municipal, state or federal agency charged with the
enforcement of any law. Pursuant to and as part of Xxxxxxxxx’x
release of Medialink as set forth above, Xxxxxxxxx agrees to the fullest extent
permitted by law, not to xxx, or file a charge, complaint, grievance or demand
for arbitration against Medialink in any forum or assist or otherwise
participate willingly or voluntarily in any claim, arbitration, suit, action,
investigation or other proceeding of any kind which relates to any matter that
involves Medialink, and that occurred up to and including the date of his
execution of this Agreement, unless required to do so by law. To the
extent any such action may be brought by a third party, Xxxxxxxxx expressly
waives any claim to any form of monetary or other damages, or any other form of
recovery or relief in connection with any such action.
(b) Notwithstanding
the provisions of Section 9(a) and Section 11(a) above, the agreement of
Xxxxxxxxx not to file a lawsuit or complaint or charge against the Medialink
Parties as provided in Section 11(a) shall not be deemed, construed or
interpreted as prohibiting Xxxxxxxxx from filing a charge or complaint against
the Medialink Parties with the U.S. Equal Opportunity Commission (the “EEOC”),
the New York State Division of Human Rights (the “DHR”) or any other state or
federal governmental agency or authority or from participating in any
investigation or proceeding which may be brought by the EEOC, the DHR or any
other governmental agency or authority against the Medialink Parties; provided
however, even though Xxxxxxxxx may file any such complaint or charge or
participate in any such investigation or proceeding, he shall not be entitled or
permitted to participate in or receive any monetary damages or assessments made
by the EEOC, the DHR or any other governmental agency or authority against the
Medialink Parties. In addition, the agreement of Xxxxxxxxx not to
file a lawsuit or complaint or charge against the Medialink Parties as contained
in Section 11(a) shall not be deemed, construed or interpreted as prohibiting
Xxxxxxxxx from challenging the validity of the release contained in Section 9(a)
or his agreement not to file a lawsuit or complaint or charge against the
Medialink Parties as contained in Section 11(a).
12. Medialink
acknowledges that Xxxxxxxxx may make an application for unemployment benefits
and Medialink agrees not to contest or object to same, provided that such
application is truthful and accurate.
13. Medialink
agrees that, other than disclosures required by law, rule or regulation, it will
make no disclosures concerning Xxxxxxxxx’x employment or other information
regarding Xxxxxxxxx, except to the extent requested to do so by Xxxxxxxxx and
except to state that pursuant to Medialink policy it can only confirm
employment, job title, dates of service, rate of pay or to disclose other
information as required by law.
14. Medialink
and Xxxxxxxxx agree that confidentiality is a material condition of this
Agreement. Xxxxxxxxx agrees not to disclose or make reference to the
terms of this Agreement without prior written consent of Medialink, except as
required by law; provided, however, that disclosure shall be permitted to
Xxxxxxxxx’x attorney, financial advisors and immediate family, and to any new or
potential employers of Xxxxxxxxx. Nothing herein shall preclude
Xxxxxxxxx from discussing in general terms his duties and responsibilities while
at Medialink. Xxxxxxxxx acknowledges that Medialink will file all
appropriate securities filings with regard to the termination of Xxxxxxxxx’x
employment relationship with Medialink.
15. Xxxxxxxxx
further agrees that he shall make no negative statements concerning any aspect
of the business of Medialink or concerning any of the Medialink Parties or The
NewsMarket, Inc. or the Merger Partner. Medialink agrees that it
shall make no negative statements regarding Xxxxxxxxx.
16. Xxxxxxxxx
acknowledges that, other than as expressly set forth herein, he has no
entitlement to severance pay, change in control payments, or any benefit
resulting from the termination of his relationship with
Medialink. Xxxxxxxxx further understands that his receiving the
consideration set forth in this Agreement is conditional upon his signing and
not revoking this Agreement and complying with the terms and provisions
hereof.
17. If
any provision, or portion thereof, of this Agreement is determined to be invalid
under applicable statute or rule of law, only such provision, and only to the
extent determined to be invalid, shall be deemed omitted from this Agreement,
the remainder of which shall remain in full force and effect.
18. This
Agreement, together with the Employment Agreement as modified herein,
constitutes the complete agreement between the parties and no other
representations have been made by Medialink or Xxxxxxxxx. This
document resolves all outstanding issues arising from Xxxxxxxxx’x relationship
with Medialink.
19. This
Agreement and its execution, validity and interpretation shall be governed in
all respects in accordance with the laws of the State of New York, excluding its
conflicts of law rules. The parties hereto agree that any legal suit,
action, or proceeding against them arising out of or relating to this Agreement
shall be brought exclusively in the United States Federal Court in the Southern
District of New York or in the Supreme Court for the State of New York, County
of New York. The parties hereto hereby accept the jurisdictions of
such courts for the purpose of any such action or proceeding. EACH
PARTY HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY
RIGHT TO A TRIAL BY JURY IN RESPECT TO ANY PROCEEDING BROUGHT BY ONE PARTY
AGAINST ANOTHER RELATED TO THIS AGREEMENT.
20. This
Agreement may be executed simultaneously in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
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MEDIALINK
WORLDWIDE INCORPORATED
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/s/
Xxxxxxxx Xxxxxxxxx
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By:
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/s/
Xxxxxx Xxxxxx
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XXXXXXXX
XXXXXXXXX
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Name:
Xxxxxx Xxxxxx
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Title: Chair.
Compensation Committee
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Date: June
18, 2009
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Date: June
19, 2009
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