EXHIBIT 10.17
FINET HOLDINGS CORPORATION
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxx Xxxxx, XX 00000
February 3, 1999
Xx. Xxx X. Xxxxxxx
000 Xxxxxxx Xxxxx
Xxxxxx Xxxxxx, Xxxxxxxxxx 00000
Dear Jan:
This will confirm the following agreements between you and Finet Holdings
Corporation (the "Company") regarding the termination of your employment by the
Company, as authorized by the Compensation Committee and agreed to by you today.
This letter agreement ("Agreement") is deemed to amend and supersede all
employment agreements and understandings between you and the Company, except as
otherwise specifically provided herein.
1. Your employment with the Company and each of its shareholders, and all
obligations of the Company pursuant to the Employment and Compensation Agreement
dated October 2, 1998 between you and the Company will terminate as of February
28, 1999 ("Termination Date"), and, as of that Date, your employment and all
positions and assignments, duties, responsibilities and authorities with the
Company (except as a member of the Board of Directors as set forth below), will
terminate. Your current salary will continue through the Termination Date.
2. On and after the Termination Date, you will continue to serve as a
member of the Company's Board of Directors until the next meeting of
shareholders at which directors are elected, at which time you will resign from
the Board and/or decline to stand for reelection. So long as you serve as a
director of the Company, you will continue to be provided a leased 1995
Mercedes-Benz automobile, for which the Company will continue to pay the lease
payments. You will pay and be responsible for all expenses associated with the
use and operation of the vehicle, other than the lease payments. At the end of
your term as a director, you may purchase the vehicle pursuant to the existing
purchase option regarding that vehicle, or return it to the Company.
3. After the Termination Date, you will be eligible to continue your
current health coverage under the Company's group health plan, as it may be
modified from time to time, pursuant to the provisions of the Consolidated
Omnibus Budget Reconciliation Act of 1986, as amended ("COBRA"). The Company
will send you, under separate cover, materials regarding this coverage and your
rights and options under it.
4. You and the Company agree that you shall have no further anti-dilution
rights pursuant to the understanding between you and the Company as reflected in
the Unanimous Written Consent of the Company's Board of Directors dated January
30, 1996, that any and all anti-dilution rights you may have or claim under such
understanding are being satisfied in full by the execution, delivery and
performance of this agreement by the Company, and further, that such
understanding is hereby terminated. You represent and warrant that you hold no
other anti-dilution rights regarding any Company securities, either directly or
indirectly, other than those possessed generally by employees of the Company
pursuant to the Company's standard stock option agreements.
5. Effective upon the later of the expiration of the revocation period as
provided below in Section 10 ("Effective Date") and your surrender to the
Company of Warrant No. 98-9 evidencing your right to purchase 300,000 shares of
the Company's common stock, and further, in full satisfaction of any and all
claims you may have against the Company, including but not limited to claims for
accrued but unpaid salary for prior periods, vacation pay and severance pay, the
Company will issue to you 300,000 shares of common stock ("Shares"). The Shares
will be included in the Company's next registration of common stock following
the Effective Date. In connection with the issuance and delivery of the Shares,
you represent and warrant to the Company that you are acquiring the Shares for
your own account, for investment and without any present intention to engage in
a distribution thereof. You understand that the certificates evidencing the
Shares will bear a legend substantially as follows:
THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, TRANSFERRED,
ASSIGNED OR HYPOTHECATED UNLESS THERE IS AN EFFECTIVE REGISTRATION
STATEMENT UNDER SUCH ACT COVERING SUCH SECURITIES, THE SALE IS MADE IN
ACCORDANCE WITH RULE 144 UNDER THE ACT, OR THE COMPANY RECEIVES AN OPINION
OF COUNSEL FOR THE HOLDER OF THESE SECURITIES REASONABLY SATISFACTORY TO
THE COMPANY, STATING THAT SUCH SALE, TRANSFER, ASSIGNMENT OR HYPOTHECATION
IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF
SUCH ACT.
6. To the extent that you hold stock options previously granted to you by
the Company, your rights regarding those stock options will be determined by
their existing terms and conditions, and are not intended to be affected or
otherwise modified by this Agreement.
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7. In additional to any and all other acknowledgments contained herein,
you specifically acknowledge that, as of the Termination Date and except as
otherwise provided herein, you have received all salary, bonus, vacation,
commission, compensation time, or other payments to which you are or may be
entitled and that you accrue no other benefits or entitlements on or after the
Termination Date except as provided in this Agreement.
8. On or before the Termination Date, you will return all items of
Company property you have or over which you had control, including but not
limited to any equipment belonging to the Company, all code and computer
programs and information of whatever nature, as well as any other materials,
documents or information, including but not limited to confidential information
in your possession or control, and that you will retain no copies thereof,
provided however that for so long as you continue as a director of the Company,
you may retain and receive financial and other information relating to the
Company as may be needed for you to properly discharge your duties as a
director.
9. (a) In consideration of the promises and undertakings contained
herein, you, on behalf of yourself, your marital community, heirs, executors,
administrators and assigns (herein collectively "You") hereby release in full
and forever discharge and acquit the Company, including any and all of its
related and affiliated entities, employees, agents, attorneys, shareholders,
officers and/or directors of any of them (hereinafter collectively "Associated
Persons") from any all claims, causes of action, liabilities, demands, damages,
penalties, debts, obligations, actions and causes of action ("Claims") whether
now known or unknown, arising on or before the date hereof and arising out of or
relating to your employment with the Company or termination therefrom, EXCEPT
that (i) you will retain all benefits, if any, which shall have vested as of the
Termination Date under the Company's 401(k) Plan and will be entitled to receive
such vested benefits under the terms of the Plan; and further that (ii) you are
not releasing, discharging or acquitting the Company from any Claims arising
under the express terms of this Agreement. This release of claims specifically
refers to and includes rights or claims arising under the federal Age
Discrimination Employment Act and any applicable provision of state law.
(B) Without limiting the generality of the foregoing, the Claims
released herein include any Claims arising out of, based upon or in any way
related to (i) any prior employment agreements, incentive agreements or benefits
or retirement plans; (ii) any property, contract or tort claims, including
wrongful discharge, breach of employment contract, breach of the covenant of
good faith and fair dealing, retaliation, intentional or negligent infliction of
emotional distress, tortious interference with existing or prospective economic
advantage, negligence, misrepresentation, breach of privacy, defamation, loss of
consortium, breach of fiduciary duty, violation of public policy or any other
common law claim of any kind; (iii) any violation or alleged violation of Title
VII
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of the Civil Rights Act of 1964, as amended, the Age Discrimination in
Employment Act, as amended, the Older Workers Benefit Protection Act of 1990,
the Equal Pay, as amended, the Fair Labor Standards Act, the Employee Retirement
Income Security Act, the Americans With Disabilities Act, the California Fair
Employment and Housing Act, the California Family Rights Act, the California
Labor Code, the California Workers' Compensation Act, California Labor Code
Section 1102.5; (iv) any claims for severance pay, bonus, sick leave, vacation
or holiday pay, life insurance, health, disability or medical insurance or any
other fringe benefit; and (v) any claim relating to or arising under any other
local, state or federal statute or regulation or principle of common law
(whether in contract or in tort) governing the employment of individuals,
discrimination in employment and/or the payment of wages or benefits.
You understand that if any fact with respect to any matter covered by this
Agreement is found to be other than, or different from the facts now believed by
you to be true, you expressly accept and assume the risk of such possible
difference in facts and agree that this Agreement shall be, and remain in full
force and effect notwithstanding such difference in fact.
You acknowledge and warrant that there are no claims or actions currently
filed or pending relating to the subject matter of this Agreement.
10. You have up to twenty-one (21) days to consider whether to sign this
Agreement. If you sign it, you have the right to revoke the waiver and release
of claims under the Age Discrimination in Employment Act ("ADEA") within seven
(7) days of signing this Agreement, and the ADEA waiver and release will not
become effective or enforceable until the revocation period has expired.
Further, by signing this Agreement, you acknowledge that in exchange for the
release of claims, including the release under the ADEA, you will receive
benefits and money you would not otherwise be entitled to receive. You are
advised to consult an attorney before signing this Agreement. Should you
exercise your right to revoke the ADEA waiver under the seven-day period, you
will not receive the benefits described above in Section 5.
11. The release set forth above is a general release and, except as
expressly provided herein, is intended to encompass all known and unknown,
foreseen and unforeseen claims which either party may have against the other,
including all Associated Persons up to and including the date of this Agreement.
It is further understood and agreed that you expressly waive all rights under
Section 1542 of the Civil Code of the State of California and any similar law of
any state or territory of the United States. Said section provides as follows:
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"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."
Please acknowledge your agreement with the foregoing by signing and return
the enclosed copy of this letter.
Finet Holdings Corporation
By: /s/ S. Xxxxx Xxxxx
----------------------------------
S. Xxxxx Xxxxx
Chairman of the Compensation
Committee and Board of Directors
Accepted and agreed to this 15th
day of February 1999:
/s/ Xxx X. Xxxxxxx
--------------------------------
Xxx X. Xxxxxxx
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