SEPARATION AGREEMENT AND GENERAL RELEASE
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THIS SEPARATION AGREEMENT AND GENERAL RELEASE (hereinafter "AGREEMENT") is
made and entered into by and between Xxxxxx Xxxxxxxx ("Xxxxxxxx") and SpaceDev,
Inc. ("EMPLOYER"), and inures to the benefit of each of EMPLOYER's current,
former and future parents, subsidiaries, related entities, employee benefit
plans and their fiduciaries, predecessors, successors, officers, directors,
shareholders, agents, employees and assigns.
RECITALS
X. Xxxxxxxx has been, for a period of time, a Director and an employee of
EMPLOYER, most recently as its Vice President of Marketing & Product Management;
X. Xxxxxxxx has agreed to tender his resignation as an employee with
EMPLOYER, effective on August 8, 2003 (referred to herein as the "Resignation
Date"), and EMPLOYER has agreed to accept Xxxxxxxx'x resignation upon its
tender, subject to the terms and conditions set forth herein;
X. Xxxxxxxx has agreed to remain on the Board of Directors without
additional compensation, other than as set forth herein, for a period of one
year; and, further agrees to immediately resign from the Board of Directors at
the request of the Chairman of the Board at any time;
X. Xxxxxxxx has also agreed that, beginning on July 2, 2003 and continuing
through the Resignation Date (the "Transition Period"), he will perform
transition support for EMPLOYER, according to the following schedule: up to ten
(10) hours per week through July 18, 2003 and no more than four (4) hours per
week thereafter until Resignation Date, as reasonably requested by EMPLOYER, and
that beginning July 2, 2003, Xxxxxxxx agrees to a cessation of vesting of all
granted stock options, and beginning on July 19, 2003 and continuing through the
Resignation Date, Xxxxxxxx will receive 50% of his salary plus full benefits as
stated herein (the "Modified Salary Terms"), which transition support and
Modified Salary Terms are accepted by EMPLOYER, subject to the terms and
conditions hereof;
X. Xxxxxxxx and EMPLOYER wish permanently to resolve any and all potential
disputes arising out of Xxxxxxxx'x employment with EMPLOYER or the cessation of
that employment.
NOW, THEREFORE, for and in consideration of the execution of this AGREEMENT
and the mutual covenants contained in the following paragraphs, EMPLOYER and
Xxxxxxxx agree as follows:
1. INCORPORATION OF RECITALS. The Recitals and identification of the
parties to, and beneficiaries of, this AGREEMENT are incorporated by reference
as though fully set forth herein.
2. NO ADMISSION OF LIABILITY. The parties agree that this AGREEMENT, and
performance of the acts required by it, does not constitute an admission of
liability, culpability, negligence or wrongdoing on the part of anyone, and will
not be construed for any purpose as an admission of liability, culpability,
negligence or wrongdoing by any party and/or by any party's current, former or
future parents, subsidiaries, related entities, predecessors, successors,
officers, directors, shareholders, agents, employees and assigns.
3. SEVERANCE BENEFIT. EMPLOYER agrees that, upon this AGREEMENT becoming
effective (as defined in Section 30, herein), it will pay to Xxxxxxxx xxxxxxxxx
in the form of continued salary payment, according to the Modified Salary Terms,
through August 8, 2003 (the "Severance Benefit"), less applicable withholding
taxes, which Severance Benefit Xxxxxxxx is not otherwise entitled to receive.
The Severance Benefit shall be paid in equal installments, corresponding with
EMPLOYER's regular payroll schedule. Severance payments and benefits will
terminate on August 8, 2003.
4. DUTIES DURING TRANSITION PERIOD. Xxxxxxxx agrees that during the
Transition Period he will assist EMPLOYER in its Marketing efforts, as
requested, including specifically an orderly transition of all marketing
contacts, leads and open correspondence and by rendering all EMPLOYER documents
accessible and usable to designated employees of EMPLOYER, and assisting
EMPLOYER in such other areas and manners as are reasonably requested.
5. AT-WILL STATUS. Nothing in this AGREEMENT is intended to modify the
at-will nature of Xxxxxxxx'x employment with EMPLOYER. Specifically, EMPLOYER
reserves the right to effect Xxxxxxxx'x separation prior to the Resignation
Date. Such separation will not alter EMPLOYER's obligations - including for
Severance and benefit continuation - set forth herein, provided that the
separation is not the result of Xxxxxxxx'x material breach of any provision of
this AGREEMENT.
6. WAGES AND VACATION TIME PAID. Xxxxxxxx acknowledges that he will use
accrued vacation during the Transition Period and EMPLOYER will not be required
to pay him for any remaining accrued and unused vacation time, if any, on the
Resignation Date. Xxxxxxxx agrees that he will cease accruing vacation and/or
paid time off (PTO) effective July 2, 2003.
7. RESIGNATION SCRIPT. During the Transition Period, the parties will work
cooperatively on the preparation of resignation scripts to use by EMPLOYER and
Xxxxxxxx to describe Xxxxxxxx'x separation from EMPLOYER, which scripts shall be
used following the Resignation Date.
8. REFERENCE REQUESTS. EMPLOYER agrees that if it is contacted by
prospective employers of Xxxxxxxx without prior notice from Xxxxxxxx of such
contact, EMPLOYER will only release information concerning the dates of
Xxxxxxxx'x employment and the last position held, and will state that EMPLOYER's
company policy is to release only such information. In the event that Xxxxxxxx
provides EMPLOYER with advance notice of a prospective employer's request for a
reference, EMPLOYER will respond to the reference request according to the
mutually-acceptable resignation script described in Section 7, above.
9. OPTION EXERCISE PERIOD. In addition to the Severance Benefit, described
above in Section 3 and as further consideration for the Releases granted herein,
Xxxxxxxx shall be permitted to extend the expiration date on options for 90,000
shares (the "Extended Options") from ninety (90) days after termination of
employment to the earlier of (i) eighteen (18) months from his resignation as a
member of the Board of Directors of SpaceDev, Inc. or other subsequent
consulting relationship with the Company, or (ii) July 19, 2008 (the "Extended
Expiration Date"). Any portion of the Extended Options not purchased at the
Extended Expiration Date will be forfeit. All other options held by Xxxxxxxx as
of July 2, 2003 shall cease to vest as of that date. Xxxxxxxx understands and
acknowledges that the Extended Options will no longer be eligible for
preferential tax treatment as Incentive Stock Options (ISOs) under Section 422
of the Internal Revenue Code of 1986, as amended, with respect to any exercise
occurring after the Resignation Date, and he will be taxed upon exercise of the
Extended Options after such date as though they had been issued as Non-Qualified
Stock Options (NQLs).
10. EQUIPMENT & MATERIALS. Xxxxxxxx will return all property of Employer,
including keys, credit cards, books, manuals, records, notes, contracts,
customer lists, passwords, access to electronic newsletters, website tools,
Proprietary Matter (as defined in that certain Employment Agreement between
Xxxxxxxx and Employer dated May 17, 2002), documents (in electronic, hard copy
or other media), copies of any of the foregoing, and any equipment furnished to
Xxxxxxxx during his employment to EMPLOYER on the Resignation Date or such
earlier date mutually agreed to between Xxxxxxxx and EMPLOYER in writing.
11. XXXXXXXX'X GENERAL RELEASE. Xxxxxxxx for himself, his heirs, executors,
administrators, assigns and successors, fully and forever releases and
discharges EMPLOYER and each of its current, former and future parents,
subsidiaries, related entities, employee benefit plans and their fiduciaries,
predecessors, successors, officers, directors, shareholders, agents, employees
and assigns (collectively, "Releasees"), with respect to any and all claims,
liabilities and causes of action, of every nature, kind and description, in law,
equity or otherwise, which have arisen, occurred or existed at any time prior to
the signing of this AGREEMENT, including, without limitation, any and all
claims, liabilities and causes of action arising out of or relating to
Xxxxxxxx'x employment with EMPLOYER or the cessation of that employment.
Notwithstanding the foregoing, the releases provided for herein and in Exhibit A
shall not apply to unknown claims with respect to the repayment or conversion of
that certain Series A Subordinated Convertible Note of EMPLOYER issued to
Xxxxxxxx on October 29, 2002. In the event that this AGREEMENT is executed by
Xxxxxxxx prior to the Resignation Date, Xxxxxxxx agrees that on the Resignation
Date he will sign the document entitled "Restated Waiver and General Release,"
attached hereto as Exhibit "A," and incorporated herein as a material part of
this AGREEMENT. In the event that Xxxxxxxx does not sign Exhibit A, EMPLOYER
will not be obligated to extend the exercise period for the vested options
previously granted to Xxxxxxxx.
12. KNOWING WAIVER OF EMPLOYMENT-RELATED CLAIMS. Xxxxxxxx understands and
agrees that, with the exception of potential employment-related claims
identified below, he is waiving any and all rights he may have had, now has, or
in the future may have, to pursue against any of the Releasees any and all
remedies available to him under any employment-related causes of action,
including without limitation, claims of wrongful discharge, breach of contract,
breach of the covenant of good faith and fair dealing, fraud, violation of
public policy, defamation, discrimination, personal injury, physical injury,
emotional distress, claims under Title VII of the Civil Rights Act of 1964, as
amended, the Age Discrimination in Employment Act, the Americans With
Disabilities Act, the Federal Rehabilitation Act, the Family and Medical Leave
Act, the California Fair Employment and Housing Act, the California Family
Rights Act, the Equal Pay Act of 1963, the provisions of the California Labor
Code and any other federal, state or local laws and regulations relating to
employment, conditions of employment (including wage and hour laws) and/or
employment discrimination. Claims not covered by the release provisions of this
AGREEMENT are (i) claims for unemployment insurance benefits, and (ii) claims
under the California Workers' Compensation Act.
13. WAIVER OF CIVIL CODE SEC. 1542. Xxxxxxxx expressly waives any and all
rights and benefits conferred upon him by Section 1542 of the Civil Code of the
State of California, which states as follows: "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." Xxxxxxxx expressly agrees and
understands that the Release given by him pursuant to this AGREEMENT applies to
all unknown, unsuspected and unanticipated claims, liabilities and causes of
action, which he may have against EMPLOYER.
14. EMPLOYER'S RELEASE. As of the date of this AGREEMENT, EMPLOYER for
itself and each of its current, former and future parents, subsidiaries, related
entities, employee benefit plans and their fiduciaries, predecessors,
successors, officers, directors, shareholders, agents, employees and assigns,
fully and forever releases and discharges Xxxxxxxx, his heirs, executors,
administrators, assigns and successors, with respect to any and all claims,
liabilities and causes of action, of every nature, kind and description, in law,
equity or otherwise, by EMPLOYER, including, without limitation, any and all
claims, liabilities and causes of action arising out of or relating to
Xxxxxxxx'x employment with EMPLOYER or the cessation of that employment.
Notwithstanding the foregoing, EMPLOYER does not release any claims it may have
against Xxxxxxxx for fraud, intentional misconduct or breach of EMPLOYER's
confidential information or for breach of Xxxxxxxx'x fiduciary duty as an
officer and/or director of EMPLOYER prior to or following the date of this
Agreement, which has damaged EMPLOYER.
15. SEVERABILITY OF RELEASE PROVISIONS. The parties agree that if any
provision of the releases given by them under this AGREEMENT is found to be
unenforceable, it will not affect the enforceability of the remaining provisions
and the courts may enforce all remaining provisions to the extent permitted by
law.
16. PROMISE TO REFRAIN FROM SUIT OR ADMINISTRATIVE ACTION. Xxxxxxxx
promises and agrees that he will never xxx EMPLOYER or any of the other
Releasees, or otherwise institute or participate in any legal proceedings
against EMPLOYER or any of the other Releasees, with respect to any claim
covered by the release provisions of this AGREEMENT, including but not limited
to claims arising out of Xxxxxxxx'x employment with EMPLOYER or the termination
of that employment, unless he is compelled by legal process to do so. Xxxxxxxx
also represents and warrants that he does not believe he has the basis to file,
nor does he intend to file, any charge or claim with any administrative agency,
including the United States Equal Employment Opportunity Commission and the
California Department of Fair Employment and Housing.
17. PROMISE TO REFRAIN FROM ASSISTING IN SUIT OR ADMINISTRATIVE ACTION.
Xxxxxxxx promises and agrees that he shall not advocate or incite the
institution of, or assist or participate in, any suit, complaint, charge or
administrative proceeding by any other person against EMPLOYER or any of the
other Releasees, unless compelled by legal process to do so.
18. CONFIDENTIALITY OF AGREEMENT. Xxxxxxxx promises and agrees that, unless
compelled by legal process, he will not disclose to others and will keep
confidential both the fact of and the terms of this AGREEMENT, including the
amounts referred to herein, except that he may disclose this information to his
attorneys, accountants and other professional advisors to whom the disclosure is
necessary to accomplish the purposes for which Xxxxxxxx has consulted such
professional advisors. Xxxxxxxx expressly promises and agrees that, unless
compelled by legal process, he will not disclose to any present or former
employees of EMPLOYER the fact or the terms of this settlement.
19. PROMISE TO MAINTAIN CONFIDENTIALITY OF EMPLOYER'S CONFIDENTIAL
INFORMATION. Xxxxxxxx acknowledges that due to the position he has occupied and
the responsibilities he has had at EMPLOYER, he has received confidential
information concerning EMPLOYER's products, procedures, customers, sales,
prices, contracts, and the like. Xxxxxxxx hereby promises and agrees that,
unless compelled by legal process, he will not disclose to others and will keep
confidential all information he has received while employed by EMPLOYER
concerning its products and procedures, the identities of its customers, sales,
prices, the terms of any of its contracts with third parties, and the like.
Xxxxxxxx agrees that a violation by him of the foregoing obligation to maintain
the confidentiality of EMPLOYER's confidential information will constitute a
material breach of this AGREEMENT. Xxxxxxxx specifically confirms that he will
continue to comply with the terms of the EMPLOYER's proprietary information and
inventions policy. Xxxxxxxx agrees that it would be difficult to compensate
EMPLOYER fully for damages for any violation of this provision. Accordingly,
Xxxxxxxx specifically agrees that EMPLOYER shall be entitled to temporary and
permanent injunctive relief to enforce the provisions of this Agreement. This
provision with respect to injunctive relief shall not, however, diminish the
right of EMPLOYER to claim and recover damages in addition to injunctive relief.
20. INTEGRATED AGREEMENT. The parties acknowledge and agree that no
promises or representations were made to them which do not appear written herein
and that this AGREEMENT contains the entire agreement of the parties on the
subject matter thereof. The parties further acknowledge and agree that parol
evidence shall not be required to interpret the intent of the parties.
21. VOLUNTARY EXECUTION. The parties hereby acknowledge that they have read
and understand this AGREEMENT and that they sign this AGREEMENT voluntarily and
without coercion.
22. WAIVER, AMENDMENT AND MODIFICATION OF AGREEMENT. The parties agree that
no waiver, amendment or modification of any of the terms of this AGREEMENT shall
be effective unless in writing and signed by all parties affected by the waiver,
amendment or modification. No waiver of any term, condition or default of any
term of this AGREEMENT shall be construed as a waiver of any other term,
condition or default.
23. REPRESENTATION BY COUNSEL. The parties represent that they have had the
opportunity to be represented in negotiations for, and the preparation of, this
AGREEMENT by counsel of their own choosing, and that they have entered into this
AGREEMENT based upon their own judgment and not in reliance upon any
representations or promises made by the other party, other than those contained
within this AGREEMENT. The parties further agree that if any of the facts or
matters upon which they now rely in making this AGREEMENT hereafter prove to be
otherwise, this AGREEMENT will nonetheless remain in full force and effect.
24. CALIFORNIA LAW. The parties agree that this AGREEMENT and its terms
shall be construed under California law.
25. AGREEMENT TO ARBITRATE CLAIMS ARISING FROM AGREEMENT. The parties agree
that if any dispute arises concerning interpretation and/or enforcement of the
terms of this AGREEMENT, said dispute shall be resolved by binding arbitration
conducted in San Diego, California in accordance with the American Arbitration
Association's National Rules for the Resolution of Employment Disputes, then in
effect ("AAA's National Rules"). In the event that such a dispute arises,
counsel for both parties will attempt to jointly select an arbitrator. If unable
to do so, the procedures outlined in the AAA's National Rules shall govern.
26. DRAFTING. The parties agree that this AGREEMENT shall be construed
without regard to the drafter of the same and shall be construed as though each
party to this AGREEMENT participated equally in the preparation and drafting of
this AGREEMENT.
27. COUNTERPARTS. This AGREEMENT may be signed in counterparts and said
counterparts shall be treated as though signed as one document.
28. PERIOD TO CONSIDER TERMS OF AGREEMENT. Xxxxxxxx acknowledges that this
AGREEMENT was presented to him on July 2, 2003 and that he is entitled to have
21 days' time in which to consider the AGREEMENT. Xxxxxxxx acknowledges that he
has obtained or had the opportunity to obtain the advice and counsel from the
legal representative of his choice and executes this AGREEMENT having had
sufficient time within which to consider its terms. Xxxxxxxx represents that if
he executes this AGREEMENT before 21 days have elapsed, he does so voluntarily,
upon the advice and with the approval of his legal counsel, and that he
voluntarily waives any remaining consideration period.
29. REVOCATION OF AGREEMENT. Xxxxxxxx understands that after executing this
AGREEMENT, he has the right to revoke it within seven (7) days after his
execution of it. Xxxxxxxx understands that this AGREEMENT will not become
effective and enforceable unless the seven-day revocation period passes and
Xxxxxxxx does not revoke the AGREEMENT in writing. Xxxxxxxx understands that
this AGREEMENT may not be revoked after the seven-day revocation period has
passed. Xxxxxxxx understands that any revocation of this AGREEMENT must be made
in writing and delivered to EMPLOYER at 00000 Xxxxx Xxxxx, Xxxxx, XX 00000,
within the seven-day period.
30. EFFECTIVE DATE. This AGREEMENT shall become effective and binding upon
the parties eight (8) days after Xxxxxxxx'x execution hereof, so long as he has
not revoked it within the time period and in the manner specified in paragraph
29, above.
By: /s/ Xxxxxx Xxxxxxxx
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Xxxxxx Xxxxxxxx
Dated: July 2, 2003
SPACEDEV, INC.
By: /s/ Xxxxx X. Xxxxxx
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Xxxxx X. Xxxxxx
Chief Executive Officer
Dated: July 2, 2003
EXHIBIT "A"
RESTATED WAIVER AND GENERAL RELEASE
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This Restated Waiver and General Release (the "Restated Release") is
executed by Xxxxxx Xxxxxxxx ("Xxxxxxxx"), for the benefit of his former
employer, SpaceDev, Inc. ("Employer"), and is intended to be a material part of
the consideration proffered by Xxxxxxxx and received by Employer under that
certain Separation Agreement and General Release (the "Release Agreement").
X. Xxxxxxxx executed the Release Agreement on July 2, 2003;
B. The Resignation Date (as defined in the Release Agreement) occurred after
Xxxxxxxx'x execution of the Release Agreement;
C. Pursuant to Section 12 of the Release Agreement, Xxxxxxxx agreed to
execute this Restated Release, under the circumstances described in Recital B.
NOW THEREFORE, in exchange for his continued receipt of the Severance Benefit
(as described in the Release Agreement), Xxxxxxxx reaffirms and represents as
follows:
1. Xxxxxxxx for himself, his heirs, executors, administrators, assigns and
successors, fully and forever releases and discharges Employer and each of its
current, former and future parents, subsidiaries, related entities, employee
benefit plans and their fiduciaries, predecessors, successors, officers,
directors, shareholders, agents, employees and assigns (collectively,
"Releasees"), with respect to any and all claims, liabilities and causes of
action, of every nature, kind and description, in law, equity or otherwise,
which have arisen, occurred or existed at any time prior to the signing of this
Restated Release, including, without limitation, any and all claims, liabilities
and causes of action arising out of or relating to Xxxxxxxx'x employment with
Employment or the cessation of that employment.
2. With the exception of potential employment-related claims identified in
the Release Agreement, Xxxxxxxx is waiving any and all rights he may have had,
now has, or in the future may have, to pursue against any of the Releasees any
and all remedies available to him under any employment-related causes of action,
including without limitation, claims of wrongful discharge, breach of contract,
breach of the covenant of good faith and fair dealing, fraud, violation of
public policy, defamation, discrimination, personal injury, physical injury,
emotional distress, claims under Title VII of the Civil Rights Act of 1964, as
amended, the Age Discrimination in Employment Act, the Americans With
Disabilities Act, the Federal Rehabilitation Act, the Family and Medical Leave
Act, the California Fair Employment and Housing Act, the California Family
Rights Act, the Equal Pay Act of 1963, the provisions of the California Labor
Code and any other federal, state or local laws and regulations relating to
employment, conditions of employment (including wage and hour laws) and/or
employment discrimination.
3. Xxxxxxxx expressly waives any and all rights and benefits conferred upon him
by Section 1542 of the Civil Code of the State of California, which states as
follows:
"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."
Xxxxxxxx expressly agrees and understands that the Release given by him pursuant
to this Restated Release applies to all unknown, unsuspected and unanticipated
claims, liabilities and causes of action, which he may have against Employer or
any of the other Releasees; provided, however, that the Release shall not apply
to unknown claims with respect to the repayment or conversion of that certain
Series A Subordinated Convertible Note of Employer issued to Xxxxxxxx on October
29, 2002.
4. Xxxxxxxx represents and warrants that, as of the date he executes this
Restated Release, he does not believe he has the basis to file, nor does he
intend to file, any charge or claim with any administrative agency, including
the United States Equal Employment Opportunity Commission and the California
Department of Fair Employment and Housing, regarding his employment with
Employer, or the cessation of that employment.
Dated: July 2, 2003 By: /s/ Xxxxxx Xxxxxxxx
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Xxxxxx Xxxxxxxx
