EXHIBIT 10.1
PRIVATE AND CONFIDENTIAL
SEVERANCE AND RELEASE AGREEMENT
THIS SEVERANCE AND RELEASE AGREEMENT (this "Agreement") is made and
entered into as of October 5, 2005 (the "Effective Date"), by and between and
Xxxxxx Medical Technology, Inc., a Delaware corporation (the "Company"), and
Xxxxxxxx X. Xxxxxx (the "Employee").
DEFINITIONS:
A. As used herein, the term "Employee" shall mean Xxxxxxxx X. Xxxxxx
and his heirs, personal representatives, and assigns.
B. As used herein, the term "Company" shall mean Xxxxxx Medical
Technology, Inc., its parent, subsidiaries, affiliates and divisions (including,
but not limited to, Xxxxxx Medical Group, Inc.), its and their respective
successors and assigns, and all of the past and present officers, directors,
employees and agents of such entities, in their individual and representative
capacities.
WHEREAS, the Employee and the Company desire to settle and resolve all
matters pertaining to Employee's employment with Xxxxxx Medical Technology, Inc.
and the termination of that employment;
NOW THEREFORE in consideration of the promises, agreements, releases and
obligations as hereinafter set forth, it is agreed by the Employee and the
Company as follows:
1. The Employee unconditionally releases the Company from any and all
causes of action and liability related to the Employee's hire, employment, and
termination of employment at the Company occurring prior to and up to the
effective date of this Agreement, including, but not limited to, any and all
breach of contract claims, common law tort claims, claims of discrimination,
claims for compensation and benefits (including claims under the Employee
Retirement Income Security Act of 1974, as amended), as well as any and all
claims which the Employee may have under or in connection with any and all
local, state or federal ordinances, statues, or common law. The only exclusion
from this release is a claim that some term of this Agreement has been violated.
The Company represents to the Employee that as the date of this Agreement, it
does not have or know of any claims or causes of actions which it may have
against the Employee. The Employee shall be entitled to indemnification by the
Company for acts arising in the course of the Employee's employment in
accordance with and subject to the indemnification provisions contained in the
Certificate of Incorporation and/or Bylaws of the Company as in effect from time
to time.
Severance and Release Agreement PRIVATE AND CONFIDENTIAL
October 5, 2005
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2. The Employee hereby resigns, as of the close of business on the
Effective Date, from his positions as the President and Chief Executive Officer
of the Company, a director of the Company, a member of the Executive Committee
of the Board of Directors of the Company, and an employee of the Company, and
from any and all other positions to which the Employee has been elected or
appointed and is now serving with the Company. The Employee agrees to execute
and deliver to the Company such resignation letters and other documents and
instruments evidencing the foregoing resignations as the Company may request
from time to time.
3. The Employee certifies that (a) this Agreement is fully understood
by the Employee and is entirely satisfactory to the Employee, (b) the Employee's
signing of this Agreement is the Employee's own free and informed act and deed,
and (c) the Employee has been given the opportunity to discuss it with counsel
of the Employee's choosing.
4. The Employee acknowledges that he is currently able to work in his
current position without limitations, either physical or mental, and without any
accommodation for any physical or mental ailment.
5. To the extent permitted by law, the Employee and the Company agree
that each will maintain the strictest secrecy and will not disclose the terms of
this Agreement to any person or entity, except (a) where such disclosure is
required by law or compelled pursuant to legal process, (b) for reporting
purposes to federal, state, or local governmental authorities, or (c) in
discussions with legal and financial advisors and the Employee's immediate
family members.
6. With respect to the Employment Agreement dated as of July 1, 2004,
as amended by the First Amendment to Employment Agreement dated as of April 4,
2005, between the Company and the Employee (collectively, the "Employment
Agreement"), the Employee agrees (a) that the Employee is not entitled to any
compensation or benefits under the Employment Agreement other than as provided
in paragraphs 4, 5, 6 and 14 thereof through the Effective Date; (b) to comply
with the covenants and to perform his obligations in full under the provisions
of paragraph 9, 10 and 11 of the Employment Agreement; and (c) that in the event
of any breach or threatened breach by the Employee of any provision of
paragraphs 9, 10 and 11 of the Employment Agreement, the Company shall be
entitled to any and all rights and remedies available to the Company under
paragraphs 11(c) and 12 of the Employment Agreement or otherwise.
Severance and Release Agreement PRIVATE AND CONFIDENTIAL
October 5, 2005
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7. The Employee hereby delivers to the Company an executed original of
the ADEA Release and Agreement attached hereto as Exhibit A, which releases the
Company from any and all liabilities under the Age Discrimination in Employment
Act of 1967, as amended.
8. Upon request by the Company, the Employee agrees to cooperate with
the Company during and after the Severance Period (as defined herein), without
further compensation by the Company, by meeting with and providing information
to the Company's representatives and others relating to the Employee's duties
performed heretofore or any governmental or other investigation or litigation
involving or affecting the Company. The person through whom this information
shall be requested by the Company will be the Employee's direct report as the
date of this Agreement or such person's designee.
9. This Agreement and any dispute arising in connection with its
operation or execution shall be construed in accordance with and governed by the
statues and common law of the State of Tennessee and shall be resolved by
binding arbitration in Memphis, Tennessee. Each party to this Agreement will
select one arbiter. The two arbiters so selected shall then select a third
arbiter. Decisions of the arbitration panel shall be binding upon the parties
hereto. The prevailing party shall be entitled to have all expenses, including,
but not limited to, attorney fees and any fees submitted by the arbitrators to
be paid by the non-prevailing party.
10. This Agreement, together with paragraphs 7(b)(ii), 9, 10, 11 and 12
of the Employment Agreement, reflect the entire agreement of the parties
relating to the subject matter hereof and supersede all prior or contemporaneous
oral or written understandings, statements, representations, promises,
arrangements or agreements between the parties. The Confidentiality and
Inventions Agreement between the parties remains in full force and effect.
11. The parties agree that each provision of this Agreement is severable
and further agree that if any term or provision is held to be invalid, void, or
unenforceable by a court of competent jurisdiction or an administrative agency
for any reason whatsoever, such ruling shall not affect the validity of the
remainder of this Agreement.
12. In consideration and exchange for this Agreement and the ADEA
Release Agreement, the Company shall provide to the Employee the following:
Severance and Release Agreement PRIVATE AND CONFIDENTIAL
October 5, 2005
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(a) an amount in cash equal to the Base Salary (as defined in the
Employment Agreement) of the Employee with respect to a period of twenty-four
(24) months after the Effective Date (the "Severance Period"), which amount
(after deduction of applicable payroll taxes) shall be paid to the Employee in
accordance with the Company's customary payroll practices in effect from time to
time and with a final payment of the remaining balance on March 10, 2006;
(b) an amount in cash equal to the Base Salary equivalent of the
Employee's earned and unused vacation for 2005, if any, which amount (after
deduction of applicable payroll taxes) shall be paid to the Employee within
thirty (30) days after the Effective Date;
(c) an amount in cash equal to the total premiums payable by the
Employee for continued group medical, dental and vision plan coverage under
COBRA at the current COBRA rate during the eighteen (18) month period
immediately following the Effective Date, which amount (after deduction of
applicable payroll taxes) shall be paid to the Employee within thirty (30) days
after the Effective Date; and
(d) the attorney's fee for review of this Agreement and the ADEA
Release and Agreement of up to $200, which amount shall be paid to the Employee
within thirty (30) days after the Effective Date.
Any stock options that the Employee has are governed by the specific
stock option agreement and the applicable stock option plan, and this Agreement
does not supersede those stock option agreements and plans. The Employee is
urged to review such stock option agreements and plans for the specific terms
that apply to his stock options.
Severance and Release Agreement PRIVATE AND CONFIDENTIAL
October 5, 2005
Page 5
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THE EMPLOYEE ACKNOWLEDGES THAT HE HAS READ THIS SEVERANCE AND RELEASE
AGREEMENT, HE UNDERSTANDS ALL OF ITS TERMS, AND HE EXECUTES IT VOLUNTARILY AND
WITH FULL KNOWLEDGE OF ITS SIGNIFICANCE AND THE CONSEQUENCES THEREOF.
AGREED AND ACCEPTED as of the Effective Date.
EMPLOYEE: XXXXXX MEDICAL TECHNOLOGY, INC.
/S/ Xxxxxxxx X. Xxxxxx By: /s/ Xxxxx X. Xxxx
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Xxxxxxxx X. Xxxxxx Xxxxx X. Xxxx, Vice President
Title: General Counsel and Secretary
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PRIVATE AND CONFIDENTIAL
EXHIBIT A
ADEA RELEASE AND AGREEMENT
As a material inducement to Xxxxxx Medical Technology, Inc.
(hereinafter referred to as "Xxxxxx" or "Employer") to enter into this ADEA
Release and Agreement (the "Release or "Agreement") with Xxxxxxxx X. Xxxxxx
(hereinafter referred to as "Employee") (for Employee, Employee's heirs,
executors, administrators and assigns), Employee hereby unconditionally releases
and forever discharges Xxxxxx and each of the Xxxxxx'x stockholders,
predecessors, successors, assigns, agents, directors, officers, employees,
representatives, attorneys, divisions, subsidiaries, affiliates and all persons
acting by, through, under, or in concert with any of them from any and all
charges, complaints, claims, liabilities, obligations, promises, agreements,
controversies, damages, actions, causes of action, suits, rights, demands,
costs, losses, debts and expenses (including attorney's fees and costs actually
incurred) of any nature whatsoever, known or unknown, suspected or unsuspected,
including, but not limited to, rights, under the Age Discrimination in
Employment Act of 1967, as amended from time to time, and other federal, state,
or local laws prohibiting discrimination, any claims the employee may have with
regard to Employee's hiring, employment, or electing the reemployment program
and termination of employment claims growing out of any legal restrictions on
Xxxxxx'x right to terminate its employees ("Claim" or Claims"), which the
Employee now has, owns or holds, or claims to have owned or held, or which the
Employee at any time hereinafter may have owned or held or claimed to have owned
or held against Xxxxxx.
To comply with the Older Workers Benefit Protection Act of 1990, as
amended from time to time, the Release and Agreement has advised Employee of the
legal requirements of this Act and fully incorporates the legal requirements by
reference into this Agreement as follows:
a. This Agreement is written in xxxxxx'x terms, and the Employee
understands and comprehends its terms;
b. Employee has been advised of Employee's rights to consult an
attorney to review the Agreement;
c. Employee does not waive any rights or claims that may arise after
the date the Release is executed;
d. Employee is receiving consideration beyond anything of value to
which he already is entitled;
e. Employee has been given a reasonable period of time to consider
this Agreement.
As consideration for this Release, Xxxxxx agrees to provide the items
listed previously in paragraph 12 of the Severance and Release Agreement dated
as of October 5, 2005. The Employee enters into this Release with full knowledge
of its contents and enters into this Agreement voluntarily.
ADEA Release and Agreement PRIVATE AND CONFIDENTIAL
October 5, 2005
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AGREED AND ACCEPTED
EMPLOYEE: XXXXXX MEDICAL TECHNOLOGY, INC.
I acknowledge that I fully understand
and agree that this Agreement may be
pleaded by Xxxxxx Medical Technology,
Inc. as a complete defense to any claim
which hereafter may be asserted by me or
a claim against Xxxxxx Medical
Technology, Inc. for or on account of
any matter or thing whatsoever arising
out of the employment relationship or my
termination from active employment.
/s/ Xxxxxxxx X. Xxxxxx By: /s/ Xxxxx X. Xxxx
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Xxxxxxxx X. Xxxxxx Xxxxx X. Xxxx, Vice President
Title: General Counsel and Secretary
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SWORN TO AND SUBSCRIBED, before me, SWORN TO AND SUBSCRIBED, before me,
a Notary Public, in my presence this a Notary Public, in my presence this
5th day of October, 2005 5th day of October, 2005
/s/ Xxxxxxx X. Xxxxxxxx /s/ Xxxxxxx X. Xxxxxxxx
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Notary Public Notary Public
County of Xxxxxx Xxxxxx County
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State of Tennessee Tennessee
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Commission Expires: 1/15/08 Commission Expires: 1/15/08
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XXXXXXX X. XXXXXXXX XXXXXXX X. XXXXXXXX
NOTARY NOTARY
PUBLIC PUBLIC
AT AT
LARGE LARGE
SHELBY CO., TN SHELBY CO., TN
MY COMM. EXP. 1-15-08 MY COMM. EXP. 1-15-08
STAMP STAMP
NOTE: THE EMPLOYEE IS HEREBY ADVISED OF HIS RIGHT TO RESCIND AND NULLIFY THIS
AGREEMENT, WHICH RIGHT MUST BE EXERCISED, IF AT ALL, WITHIN SEVEN (7) DAYS OF
THE DATE OF THE EMPLOYEE'S SIGNATURE. THE EMPLOYEE MUST REVOKE THE RELEASE BY
LETTER TO XXXXXX MEDICAL TECHNOLOGY, INC., ATTENTION: GENERAL COUNSEL, 0000
XXXXXXX XXXX, XXXXXXXXX, XX 00000, WITHIN SEVEN (7) DAYS. NO CONSIDERATION
SHALL BE CONVEYED UNTIL SUCH TIME PERIOD HAS EXPIRED.
