EXHIBIT 10.16
FIRST AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
THIS FIRST AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this "Agreement"), is
executed and delivered on August 5, 2004, to be effective as of April 1, 2004
(the "Effective Date"), by and between Lindows, Inc., a Delaware corporation
(the "Company"), and Xxxxxxx Xxxxxxxxx, an individual resident of the State of
California ("Employee").
RECITALS
WHEREAS, the Company and Employee previously executed and delivered an
Employment Agreement, dated as of April 1, 2004 (the "Original Agreement"); and
WHEREAS, the Company and Employee previously executed and delivered a First
Amendment to Employment Agreement, dated as of June 9, 2004 (the "First
Amendment"); and
WHEREAS, the Company and Employee now wish to enter into this Agreement in order
to amend and restate the Original Agreement solely for the purposes of: (i)
incorporating herein the terms and conditions set forth in the First Amendment;
and (ii) modifying Employee's address set forth on the signature page hereof;
NOW, THEREFORE, in consideration of the mutual covenants contained herein and
Employee's continued employment pursuant to the terms of this Agreement, the
Company and Employee, intending to be legally bound, hereby agree as follows:
1. POSITION AND RESPONSIBILITIES
(a) Position. Employee is employed by the Company to render services to
the Company in the position of Chief Executive Officer (CEO). Employee
shall report directly to the Board of Directors. Employee shall perform
such duties and responsibilities as are normally related to such position,
in accordance with industry standards, and any additional duties now or
hereafter assigned to Employee by the Board of Directors. Employee shall
abide by the Company's rules, regulations and practices, as adopted or
modified from time to time in the Company's sole discretion. Without
limiting the generality of the foregoing, for so long as Employee holds
the position of CEO, at the Company's request Employee shall execute all
certifications (or back-up certifications) required to be executed by the
Company's CEO (or person performing similar functions) pursuant to the
regulations adopted by the Securities and Exchange Commission under
Section 302 of the Xxxxxxxx-Xxxxx Act of 2002 ("SOX"), all certifications,
back-up certifications or similar items required to be executed by the
Company's CEO (or equivalent thereof) pursuant to Section 404 of the SOX
or the Company's independent auditors, and all certifications(or back-up
certifications) required to be executed by the Company's CEO (or
equivalent thereof) pursuant to Section 906 of SOX.
(b) Other Activities. Except with the prior written consent of the
Company, Employee shall not, during the term of this Agreement, (i) accept
any other employment, or (ii) engage, directly or indirectly, in any other
business activity (whether or not
pursued for pecuniary gain) that might interfere with Employee's duties
and responsibilities hereunder or create a conflict of interest with the
Company. Upon receipt of prior approval by the Board of Directors,
Employee may serve as a member of the board of directors of any company
that does not compete directly with the Company; provided, however, that
such restriction shall not apply to any of the three existing private
company boards on which Employee serves at the time of the Effective Date.
Notwithstanding the foregoing, Employee may also devote reasonable time
and attention to civic, charitable or social organizations so long as such
activities do not interfere with the performance of his duties to the
Company.
(c) No Conflict. Employee represents and warrants that Employee's
execution of this Agreement, Employee's employment with the Company and
the performance of Employee's proposed duties under this Agreement shall
not violate any obligations Employee may have to any prior employer, or
any other person or entity, including, without limitation, any obligations
with respect to proprietary or confidential information of any prior
employer, or any other person or entity.
(d) Effectiveness of Certain Provisions. Notwithstanding anything to the
contrary in this Agreement, Sections 2(a), 2(b) and 3(c) of this Agreement
shall not be of any legal force or effect whatsoever unless and until the
IPO Closing (as defined below), at which time such sections shall become
effective unless Employee has ceased to be employed by the Company prior
to the date of the IPO Closing or this Agreement has otherwise been
terminated prior to the date of the IPO Closing. If Employee is still
employed by the Company upon the IPO Closing, then within five (5) days
after the IPO Closing the Company shall pay to Employee an amount equal
to: (a) the Base Salary (as defined in Section 2(a) below) pro rated for
the period of time between the Effective Date and the IPO Closing; minus
(b) the amount of any other salary that the Company paid to Employee for
the period of time between the Effective Date and the IPO Closing. As used
in this Agreement, the term "IPO Closing" means the closing of the
Company's initial public offering under the Securities Act of 1933, as
amended.
2. COMPENSATION AND BENEFITS
(a) Base Salary. In consideration of the services to be rendered under
this Agreement, the Company shall pay to Employee a salary at the rate of
Four Hundred Ten Thousand Dollars ($410,000) per year, as adjusted as
permitted in this subsection (the "Base Salary"). The Base Salary shall be
paid in accordance with the Company's standard bi-weekly payroll
practices. The Base Salary will be reviewed and adjusted from time to time
in accordance with the Company's procedures for adjusting salaries for
senior executives.
(b) Bonus. Employee shall be eligible to receive an annual bonus of up
to twenty-five percent (25%) of the Base Salary, subject to Employee's
attainment of reasonable corporate goals and objectives to be established
annually by the Company's Board of Directors (or a compensation committee)
with the assistance and agreement of Employee, such goals and objectives
to be agreed upon as soon as practicable with respect to fiscal year 2004
and each fiscal year thereafter (the "Bonus").
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(c) Stock Options and Change of Control with Respect to Stock Options.
(i) Concurrently with the execution and delivery of the Original
Agreement, the Company granted to Employee an option (the "Option")
to purchase One Million Five Hundred Thousand (1,500,000) shares
(pre IPO stock split) of the Company's Common Stock, $0.0001 par
value per share (the "Common Stock"), effective as of the date such
grant was approved by the Company's Board of Directors (the "Grant
Date"), pursuant to the terms of the form stock option agreement
under the Company's 2001 Stock Incentive Plan (the "Plan"). A copy
of such form stock option agreement is attached hereto as Exhibit B
and incorporated in whole by this reference (the "Option
Agreement"). The exercise price per share of the Option was Two
Dollars and Fifty Cents ($2.50), which is the fair market value per
share of the Common Stock that the Board approved as of the Grant
Date. The shares subject to the Option become vested and exercisable
in equal amounts on a monthly basis over a four year period,
commencing on the Effective Date. The Option shall be a
Non-Qualified Stock Option (as defined in the Plan).
(ii) To the extent determined by the administrator(s) of the
respective stock incentive plan(s) under which such options have been or
will be granted, all non-vested options to purchase Common Stock granted
to Employee will immediately become vested upon any Change in Control or
Corporate Transaction that occurs during the term of Employee's employment
with the Company. For these purposes, the terms "Change in Control" and
"Corporate Transaction" shall have the meanings given to such terms in the
respective stock incentive plan(s) under which such options have been or
will be granted.
(d) Benefits. Effective as of the Effective Date, Employee shall be
eligible to participate in any and all benefits made generally available
by the Company to executive officers of the Company in accordance with the
benefit plans established by the Company, as such plans may be amended
from time to time in the Company's sole discretion. Without limiting the
generality of the foregoing, effective as of the Effective Date, Employee,
and to the extent applicable, Employee's covered dependants, shall be
eligible to participate in the Company's 401(k) program and shall receive
immediate enrollment for health benefits to the maximum extent possible
under the Company's benefit plans.
(e) Vacation. Employee shall receive four (4) week of paid vacation time
per calendar year, which amount shall increase in accordance with the
Company's vacation policy for employees of the Company generally. Employee
may take such accrued vacation at such times as are mutually convenient to
Employee and the Company. In addition, Employee shall be entitled to all
holidays provided under the Company's regular holiday schedule.
(f) Business Expenses. The Company will reimburse Employee for
reasonable and necessary expenses appropriately incurred by Employee in
performing his duties and obligations to the Company in accordance with,
and subject to, such policies and procedures regarding executive officer
expenses generally as the Company may from time to time have in effect.
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3. AT-WILL EMPLOYMENT
(a) At-Will Termination by Company. The employment of Employee shall be
"at-will" at all times. The Company may terminate Employee's employment
with the Company at any time, without any advance notice, for any reason
or no reason at all, notwithstanding anything to the contrary contained in
or arising from any statements, policies or practices of the Company
relating to the employment, discipline or termination of its employees.
Upon and after the date of such termination, all obligations of the
Company shall cease, except as set forth below in Section 3(c).
(b) At-Will Termination by Employee. Employee may terminate employment
with the Company at any time for any reason or no reason at all, upon two
weeks' advance written notice. During such notice period Employee shall
continue to diligently perform all of Employee's duties hereunder. The
Company shall have the option, in its sole discretion, to make Employee's
termination effective at any time prior to the end of such notice period
as long as the Company pays Employee all compensation (including all
accrued Base Salary (as then in effect), Bonus or vacation and subject to
payment of all reimbursable expenses) incurred to which Employee is
entitled up through the last day of the two-week notice period. Any and
all options to acquire shares of Common Stock that have vested under the
Option (or any other option that Employee shall receive while employed by
the Company hereunder) shall continue to belong to Employee, subject to
the terms of exercise set forth in the related option agreements.
Thereafter all obligations of the Company shall cease, except as set forth
below in Section 3(c).
(c) Termination by Company without Cause or by Employee for Good Reason.
(i) If the Company terminates Employee's employment other than for
Cause (as defined below) or if Employee terminates his employment for Good
Reason (as defined below) or if Employee shall die or become disabled as a
direct result of business related activities within nine (9) months of the
Effective Date, then (A) within five (5) business days of the date on
which Employee's employment is terminated, the Company shall pay to
Employee in one lump sum payment that aggregate amount of Base Salary and
Bonus that the Company would have paid to Employee during the Severance
Period if Employee had remained employed with the Company throughout the
Severance Period, (B) during the Severance Period the Company shall
continue to make available to Employee the benefits made generally
available by the Company to its employees, to the extent permitted under
applicable law and the terms of the benefit plans, and (C) all non-vested
options to purchase Company stock granted to Employee will immediately
become vested. If the date of Employee's termination is on or before the
first anniversary of the Effective Date, then for purposes of this
Agreement the term "Severance Period" shall mean the period beginning on
the date of Employee's termination and ending on the third anniversary of
the Effective Date. If the date of Employee's termination is after the
first anniversary of the Effective Date, then for purposes of this
Agreement the term "Severance Period" shall mean the twenty-four
(24)-month period immediately following the date of Employee's
termination. This Section 3(c)(i) shall supercede any term to the contrary
in all stock option agreements entered into between the Company and
Employee, whether now existing or hereinafter executed, and Employee and
the
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Company agree to execute and deliver any amendments to such agreements
necessary to effectuate this Section 3(c)(i).
(ii) The Company's termination of Employee's employment shall be
for "Cause" if Employee: (A) exhibits willful misconduct or dishonesty
which materially and adversely effects the business reputation of Employee
or the Company; (B) is convicted of a felony; (C) acts (or fails to act)
in the performance of his duties to the Company in bad (good) faith and to
the Company's detriment; (D) materially breaches this Agreement or any
other agreement with the Company, which if curable, is not cured to the
Company's reasonable satisfaction within thirty (30) days of written
notice thereof; or (E) engages in misconduct that is demonstrably and
materially injurious to the Company, including, without limitation,
willful and material failure to perform his duties as an officer or
employee of the Company or excessive absenteeism unrelated to illness or
vacation which if curable, is not cured to the Company's reasonable
satisfaction within thirty (30) days of written notice thereof.
(iii) For the purposes of this Agreement "Good Reason" means, the
occurrence, without the express written consent of Employee, of any of the
following events: (A) any reduction or diminution (except temporarily
during any period of disability) in Employee's titles or positions assured
in Section 1(a) under this Agreement, or any material diminution in
Executive's authority, duties, responsibilities with the Company or change
from reporting directly to the Board of Directors; (B) a breach by the
Company of any material provision of this Agreement, including, but not
limited to, any reduction (other than a reduction (not to exceed ten
percent (10%)) that applies, in equal percentages, to all officers (within
the meaning of Section 16 of the Securities Exchange Act of 1934, as
amended) of the Company), in Employee's Base Salary or any material
failure to timely pay any part of Employee's compensation (including,
without limitation, Base Salary, and bonus) or to materially provide in
the aggregate the level of benefits contemplated in this Agreement; (C)
the failure of the Company to obtain and deliver to Employee a
satisfactory written agreement from any successor to the Company to assume
and agree to perform this Agreement; or (D) the Employee is asked to do
anything that would be considered illegal or unethical.
(iv) Employee's right to receive any payments or other benefits
under this Section 3(c) is expressly conditioned upon: (A) Employee's
execution of a general release of all claims as of the date of Employee's
termination, in substantially the form attached to this Agreement as
Exhibit A (the "General Release"); and (B) Employee's compliance with his
obligations under this Agreement, and all other agreements between
Employee and the Company.
(v) Employee's right to receive any payments or other benefits
under this Section 3(c) upon his death or disability shall automatically
terminate concurrently with the establishment of any death or disability
insurance plan or benefit (other than any existing group life or
disability insurance program) approved by the Company's Board of Directors
for the benefit of Employee.
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4. TERMINATION OBLIGATIONS
(a) Return of Property. Employee agrees that all property (including,
without limitation, all equipment, tangible proprietary information,
documents, records, notes, contracts and computer-generated materials)
furnished to or created or prepared by Employee incident to Employee's
employment belongs to the Company and shall be promptly returned to the
Company upon termination of Employee's employment.
(b) Cooperation. Following any termination of his employment, Employee
shall perform any and all acts requested by the Company to ensure the
orderly and efficient transition of Employee's duties. Such acts may
include, but are not limited to: (i) participating in meetings or
telephone conferences; (ii) reviewing, preparing or executing documents;
and (iii) providing assistance in connection with any litigation,
investigation or audit involving the Company, or any of its affiliates,
directors, officers, employees, agents, attorneys, representatives,
stockholders, insurers, divisions, successors and/or assigns and any
related holding, parent or subsidiary corporations.
5. NON-DISCLOSURE OF THIRD-PARTY INFORMATION
Employee represents and warrants and covenants that Employee shall not disclose
to the Company, or use, or induce the Company to use, any proprietary
information or trade secrets of others at any time, including but not limited to
any proprietary information or trade secrets of any former employer, if any; and
Employee acknowledges and agrees that any violation of this provision shall be
grounds for Employee's immediate termination and could subject Employee to
substantial civil liabilities and criminal penalties. Employee further
specifically and expressly acknowledges that no officer or other employee or
representative of the Company has requested or instructed Employee to disclose
or use any such third-party proprietary information or trade secrets.
6. NONINTERFERENCE; NONSOLICITATION
Employee acknowledges and agrees that the Company's relationships with its
employees, consultants, customers, vendors and service providers are valuable
business assets. Accordingly, Employee agrees that, during his employment with
the Company and during the Severance Period after the date of any termination of
such employment, he will not (for himself or for any third party) divert or
attempt to divert from the Company any business, employee, consultant, customer,
vendor or service provider, through solicitation or otherwise, or otherwise
interfere with the Company's business or the Company's relationships with its
employees, consultants, customers, vendors and service providers.
7. AMENDMENTS; WAIVERS; REMEDIES
This Agreement may not be amended or waived except by a writing signed by
Employee and by a duly authorized officer of the Company. Failure to exercise
any right under this Agreement shall not constitute a waiver of such right. Any
waiver of any breach of this Agreement shall not operate as a waiver of any
subsequent breaches. All rights or remedies specified for a party herein shall
be cumulative and in addition to all other rights and remedies of the party
hereunder or under applicable law.
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8. ASSIGNMENT; BINDING EFFECT
(a) Assignment. The performance of Employee is personal hereunder, and
Employee agrees that Employee shall have no right to assign and shall not
assign or purport to assign any rights or obligations under this
Agreement. This Agreement may be assigned or transferred by the Company
and nothing in this Agreement shall prevent the consolidation, merger or
sale of the Company or a sale of any or all or substantially all of its
assets.
(b) Binding Effect. Subject to the foregoing restriction on assignment
by Employee, this Agreement shall inure to the benefit of and be binding
upon each of the parties; the affiliates, officers, directors, agents,
legal representatives, successors and assigns of the Company; and the
heirs, devisees, spouses, legal representatives and successors of
Employee.
9. NOTICES
All notices or other communications required or permitted hereunder shall be
made in writing and shall be deemed to have been duly given if delivered: (a) by
hand; (b) by a nationally recognized overnight courier service; or (c) by United
States first class registered or certified mail, return receipt requested, to
the principal address of the other party, as set forth below on the signature
page of this Agreement. The date of notice shall be deemed to be the earlier of
(i) actual receipt of notice by any permitted means, or (ii) five (5) business
days following dispatch by overnight delivery service or the United States mail.
Employee shall be obligated to notify the Company in writing of any change in
Employee's address. Notice of change of address shall be effective only when
provided in accordance with this Section 9.
10. SEVERABILITY
If any provision of this Agreement shall be held by a court or arbitrator to be
invalid, unenforceable or void, such provision shall be enforced to the fullest
extent permitted by law, and the remainder of this Agreement shall remain in
full force and effect. In the event that the time period or scope of any
provision is declared by a court or arbitrator of competent jurisdiction to
exceed the maximum time period or scope that such court or arbitrator deems
enforceable, then such court or arbitrator shall reduce the time period or scope
to the maximum time period or scope permitted by law.
11. TAXES
All amounts paid under this Agreement (including, without limitation, the Base
Salary) shall be paid less all applicable state and federal tax withholdings and
any other withholdings required by any applicable jurisdiction.
12. GOVERNING LAW
This Agreement shall be governed by and construed in accordance with the
internal laws of the State of California, without regard to conflicts of law
principles.
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13. INTERPRETATION
This Agreement shall be construed as a whole, according to its fair meaning, and
not in favor of or against any party. Sections and section headings contained in
this Agreement are for reference purposes only, and shall not affect in any
manner the meaning or interpretation of this Agreement. Whenever the context
requires, references to the singular shall include the plural and the plural the
singular.
14. ATTORNEY'S FEES
If any action at law or in equity is necessary to enforce or interpret the terms
of this letter agreement, the prevailing party shall be entitled to reasonable
attorneys' fees, costs and necessary disbursements, in addition to any other
relief to which the party may be entitled.
15. OBLIGATIONS SURVIVE TERMINATION OF EMPLOYMENT
The parties agree that any and all of the Company's or Employee's obligations
under this Agreement shall survive the termination of this Agreement.
16. COUNTERPARTS
This Agreement may be executed in any number of counterparts, each of which
shall be deemed an original of this Agreement, but all of which together shall
constitute one and the same instrument.
17. AUTHORITY
Each party represents and warrants that such party has the right, power and
authority to enter into and execute this Agreement and to perform and discharge
all of the obligations hereunder; and that this Agreement constitutes the valid
and legally binding agreement and obligation of such party and is enforceable in
accordance with its terms.
18. ENTIRE AGREEMENT
This Agreement, and the exhibits attached hereto, are intended to be the final,
complete and exclusive statement of the terms of Employee's employment by the
Company and may not be contradicted by evidence of any prior or contemporaneous
statements or agreements. Notwithstanding the foregoing, this Agreement shall
not supersede or otherwise affect any agreements previously or concurrently
executed by Employee relating to the Company's proprietary information or
intellectual property rights, or relating to Employee's non-interference or
non-solicitation obligations relative to the Company's business or employees. To
the extent that the practices, policies or procedures of the Company, now or in
the future, apply to Employee and are inconsistent with the terms of this
Agreement, the provisions of this Agreement shall control. Any subsequent change
in Employee's duties, position or compensation shall not affect the validity or
scope of this Agreement.
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19. EMPLOYEE ACKNOWLEDGEMENT
Employee acknowledges that Employee has had the opportunity to consult legal
counsel concerning this Agreement, that Employee has read and understands this
Agreement, that Employee is fully aware of its legal effect and that Employee
has entered into this Agreement freely based on Employee's own judgment and not
on any representations or promises other than those contained in this Agreement.
[SIGNATURE PAGE TO EMPLOYMENT AGREEMENT FOLLOWS]
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IN WITNESS WHEREOF, the parties hereby execute this First Amended and
Restated Employment Agreement as of the Effective Date.
LINDOWS, INC. EMPLOYEE:
By:/s/ Xxxxx Xxxxxxx /s/ Xxxxxxx Xxxxxxxxx
----------------------------------- --------------------------------------
Name: Xxxxx Xxxxxxx Xxxxxxx Xxxxxxxxx
Title: COO and President CEO
Address for notices: Address for notices:
0000 Xxxxxxx Xxx., Xxxxx 000 c/o Lindows, Inc.
Xxx Xxxxx, XX 00000 0000 Xxxxxxx Xxx., Xxxxx 000
Attention: Xxxxx Xxxxxxx Xxx Xxxxx, XX 00000
[COUNTERPART SIGNATURE PAGE
TO FIRST AMENDED AND RESTATED EMPLOYMENT AGREEMENT]
EXHIBIT A
FORM OF GENERAL RELEASE OF CLAIMS
THIS GENERAL RELEASE OF CLAIMS (this "Release") is executed and delivered as of
_____________, ____, by and between ______________, a Delaware corporation (the
"Company"), and the individual named on the signature page hereof (the
"Releasor"). Each of the Company and the Releasor is referred to herein as a
"Party," and, collectively, as the "Parties."
RECITALS
WHEREAS, the Company and the Releasor previously executed and delivered a
First Amended and Restated Employment Agreement (the "Employment Agreement");
WHEREAS, pursuant to terms and conditions of the Employment Agreement, the
Releasor is entitled to certain severance payments in specific circumstances,
subject to, among other things, Releasor's execution and delivery of this
Release; and
WHEREAS, by execution hereof, the Releasor acknowledges and agrees that:
(i) this Release is a compromise of doubtful and disputed claims, if any, which
remain untested; (ii) there has not been a trial or adjudication of any issue of
law or fact herein; (iii) the terms and conditions of this Release are in no way
to be construed as an admission of liability on the part of the Company; and
(iv) the Company denies any liability and intends merely to avoid litigation
with this Release;
NOW, THEREFORE, in consideration of the foregoing recitals, and the
representations, warranties, covenants and promises contained herein, the
adequacy and sufficiency of which are hereby acknowledged, the Parties agree as
follows:
AGREEMENT
1. Release of the Company by the Releasor.
(a) The Releasor does hereby unconditionally, irrevocably and absolutely
release and discharge the Company, and its affiliates, directors, officers,
employees, agents, attorneys, representatives, stockholders, insurers,
divisions, successors and/or assigns and any related holding, parent or
subsidiary corporations, from any and all loss, liability, claims, costs
(including, without limitation, attorneys' fees), demands, causes of action, or
suits of any type, whether in law and/or in equity, related directly or
indirectly or in any way connected with any transaction, affairs or occurrences
between them and arising on or prior to the date of this Release, including, but
not limited to, the Releasor's employment with the Company, the termination of
said employment and claims of emotional or physical distress related to such
employment or termination, excepting only Releasor's rights (1) as a participant
under various Company benefit and stock plans and programs; (2) to enforce
obligations under his Employment Agreement and this Release; and (3) for defense
and indemnification in the event of any claims for which such defense or
indemnification would be appropriate under Cal. Labor
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Code sec. 2802, the California Corporations Code, or any Company bylaw or policy
relating to indemnification. This Release specifically applies to any claims for
age discrimination in employment, including, without limitation, any claims
arising under the Age Discrimination In Employment Act or any other statutes or
laws that govern discrimination in employment.
(b) The Releasor irrevocably and absolutely agrees that he will not
prosecute nor allow to be prosecuted on his behalf in any administrative agency,
whether federal or state, or in any court, whether federal or state, any claim
or demand of any type related to any of the matters released above, it being an
intention of the Parties that with the execution by the Releasor of this
Release, the Company, its officers, directors, employees, agents, attorneys,
representatives, successors and/or assigns, and any related holding, parent and
subsidiary corporations, will be absolutely, unconditionally and forever
discharged of and from all obligations to or on behalf of the Releasor related
in any way to the matters released above.
(c) The Releasor does expressly waive all of the benefits and rights
granted to him pursuant to any applicable law or regulation to the effect that:
A general release does not extend to claims which the creditor does
not know of 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.
(d) The Releasor does certify that he has read all of this Release, and
that he fully understands all of the same. The Releasor hereby expressly agrees
that this Release shall extend and apply to all unknown, unsuspected and
unanticipated injuries and damages, as well as those that are now known;
provided that this Release shall not apply to Releasor's right to receive any
severance payments or benefits during the Severance Period as defined in the
Employment Agreement referred to herein..
(e) The Releasor further declares and represents that no promise,
inducement or agreement not herein expressed has been made to him and that this
Release contains the full and entire agreement between the Parties relating to
the Releasor's release of claims, and that the terms of this Release are
contractual and not a mere recital.
2. Review and Revocation Periods. The Releasor represents, acknowledges
and agrees that: (i) the Company has advised him, in writing, to discuss this
Release with an attorney, and that to the extent, if any, that the Releasor has
desired, the Releasor has done so; (ii) the Company has given the Releasor
twenty-one (21) days to review and consider this Release before signing it, and
the Releasor understands that he may use as much of this twenty-one (21) day
period as he wishes prior to signing; (iii) that no promise, representation,
warranty or agreements not contained herein have been made by or with anyone to
cause him to sign this Release; (iv) that he has read this Release in its
entirety, and fully understands and is aware of its meaning, intent, contents
and legal effect; and (v) he is executing this Release voluntarily, and free of
any duress or coercion. The Parties acknowledge that for a period of seven (7)
days following the execution of this Release, the Releasor may revoke this
Release, and this Release shall not become effective or enforceable until the
revocation period has expired. This Release shall become effective eight (8)
days after it is signed by the Parties, and in the event the Parties do not sign
on the same date, then this Release shall become effective eight (8) days after
the date it is signed by the Releasor.
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3. Full and Complete Defense. This Release may be pleaded as a full and
complete defense and may be used as the basis for an injunction against any
action, suit or proceeding that may be prosecuted, instituted or attempted by
the Releasor against the Company.
4. Tax Indemnification. As part of this Release, the Releasor agrees to
indemnify, hold harmless, and, at the Company's request, defend the Company and
its affiliates, directors, officers, employees, agents, attorneys,
representatives, stockholders, insurers, divisions, successors and/or assigns
and any related holding, parent or subsidiary corporations, from and against any
and all loss, liability, claims, costs (including, without limitation,
attorneys' fees), demands, causes of action, or suits of any type, whether in
law and/or in equity, related directly or indirectly or in any way connected
with any federal or state income or other taxes payable or claimed to be payable
as a result of any consideration that the Company pays to the Releasor pursuant
to this Release or the Employment Agreement.
5. Amendments, etc. This Release may not be amended or waived except by
a writing signed by the Releasor and by a duly authorized officer of the
Company. Failure to exercise any right under this Release shall not constitute a
waiver of such right. Any waiver of any breach of this Release shall not operate
as a waiver of any subsequent breaches. All rights or remedies specified for a
Party herein shall be cumulative and in addition to all other rights and
remedies of the Party hereunder or under applicable law.
6. Assignment; Binding Effect. The Releasor agrees that he shall have
no right to assign and shall not assign or purport to assign any rights or
obligations under this Release. This Release may be assigned or transferred by
the Company; and nothing in this Release shall prevent the consolidation, merger
or sale of the Company or a sale of any or all or substantially all of its
assets.
7. Severability. If any provision of this Release shall be held by a
court or arbitrator to be invalid, unenforceable or void, such provision shall
be enforced to the fullest extent permitted by law, and the remainder of this
Release shall remain in full force and effect. In the event that the time period
or scope of any provision is declared by a court or arbitrator of competent
jurisdiction to exceed the maximum time period or scope that such court or
arbitrator deems enforceable, then such court or arbitrator shall reduce the
time period or scope to the maximum time period or scope permitted by law.
8. Governing Law. This Release shall be governed by and construed in
accordance with the internal laws of the State of California, without regard to
conflicts of law principles.
9. Interpretation. This Release shall be construed as a whole,
according to its fair meaning, and not in favor of or against any Party.
Sections and section headings contained in this Release are for reference
purposes only, and shall not affect in any manner the meaning or interpretation
of this Release. Whenever the context requires, references to the singular shall
include the plural and the plural the singular.
10. Counterparts. This Release may be executed in any number of
counterparts, each of which shall be deemed an original of this Release, but all
of which together shall constitute one and the same instrument.
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11. Authority. Each Party represents and warrants that such Party has
the right, power and authority to enter into and execute this Release and to
perform and discharge all of the obligations hereunder; and that this Release
constitutes the valid and legally binding agreement and obligation of such Party
and is enforceable in accordance with its terms.
12. Entire Agreement. This Release is intended to be the final, complete
and exclusive statement of the terms set forth herein and may not be
contradicted by evidence of any prior or contemporaneous statements or
agreements.
13. Opportunity to Consult Legal Counsel. The Releasor acknowledges that
he has had the opportunity to consult legal counsel concerning this Release,
that he has read and understands this Release, that he is fully aware of its
legal effect and that he has entered into this Release freely based on his own
judgment and not on any representations or promises other than those contained
in this Release.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the Parties hereby execute this Release as of the date
first above written.
, RELEASOR:
--------------------
By:
----------------------------------- --------------------------------------
Name: Signature
Title:
--------------------------------------
Print Name
[SIGNATURE PAGE TO GENERAL RELEASE OF CLAIMS]
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EXHIBIT B
OPTION AGREEMENT
See attached.
B-1
