EXHIBIT 10.41
SEVERANCE AGREEMENT
THIS AGREEMENT (the "Agreement") is made and entered into as of the 12th day
of August, 1998, by and between Silicon Valley Bancshares ("Bancshares") and
Xxxxx X. Xxxxxxx, Xx. ("Xx. Xxxxxxx").
RECITALS
WHEREAS, Xx. Xxxxxxx is Executive Vice President of Bancshares and Executive
Vice President, Strategic Products and Services Group, of Silicon Valley Bank
(the "Bank");
WHEREAS, Xxxx X. Xxxx ("Xx. Xxxx") is the President and Chief Executive
Officer of Bancshares and the Bank;
WHEREAS, Bancshares has made an equity investment in non-voting preferred
stock (the "Preferred Stock") of garage.com-TM- (the "Company") and, in that
regard, has been offered membership on the Company's board of directors;
WHEREAS, Bancshares has asked, and Xx. Xxxx has agreed, to serve as a
director of the Company;
WHEREAS, Xx. Xxxxxxx has provided, and will from time to time in the future
provide, support to Xx. Xxxx in connection with Xx. Xxxx'x activities concerning
the Company;
WHEREAS, the Company offered to Bancshares the opportunity to purchase
75,000 shares of the Company's common stock (the "Common Stock"), in regard to
services provided by Xx. Xxxx on the Company's board of directors;
WHEREAS, Xx. Xxxxxxx'x support of Xx. Xxxx in connection with Xx. Xxxx'x
service on the board of directors of the Company will provide value to
Bancshares;
WHEREAS, Bancshares purchased the Common Stock for a total purchase price of
$750;
WHEREAS, the Company intends to form a California limited liability company
each year during its existence (the "LLCs") to hold and distribute securities,
or the proceeds from the sale or disposition of such securities, that the
Company receives in each particular year from entities that seek to raise
capital using the Company's Internet matchmaking service;
WHEREAS, the Company intends to allocate an interest in each of the annual
LLCs to its holders of common and preferred stock, including Bancshares. For
purposes of this Agreement, "Interests" means the interests allocated by the
Company in each of the annual LLCs to Bancshares related solely to Bancshares'
ownership of the Common Stock granted in regards to Xx. Xxxx'x services on the
Company's board of directors; and
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WHEREAS, Bancshares and Xx. Xxxx entered into that certain Severance
Agreement dated August 12, 1998 (the "Bancshares/Xxxx Agreement"). A copy of the
Bancshares/Xxxx Agreement is attached as Exhibit A and incorporated by
reference.
NOW, THEREFORE, in consideration of the foregoing recitals and the mutual
covenants set forth below, the parties agree as follows:
AGREEMENT
1. RIGHTS IN THE STOCK AND THE INTERESTS. Except as otherwise provided in
this Agreement and in the Bancshares/Xxxx Agreement, Bancshares has all right,
title and interest in the Common Stock and the Interests.
2. XX. XXXXXXX'X PARTICIPATION IN THE BANCSHARES/XXXX AGREEMENT. If
Bancshares is obligated to pay Xx. Xxxx the Determined Value (as defined in
Section 3 of the Bancshares/Xxxx Agreement) pursuant to Section 4 of the
Bancshares/Xxxx Agreement, Bancshares shall pay one-half of the amount of the
Determined Value to Xx. Xxxxxxx and one-half of the Determined Value to Xx.
Xxxx; provided however, that the conditions set forth in Section 3, below, are
satisfied.
3. CONDITIONS TO XX. XXXXXXX'X PARTICIPATION IN THE DETERMINED VALUE. Xx.
Xxxxxxx may participate in the Determined Value only if: (i) this Agreement has
not earlier been terminated by Bancshares in accordance with Section 4 below;
and (ii) Xx. Xxxxxxx is employed by Bancshares and the Bank on the date of Xx.
Xxxx'x Separation (as defined in Section 2 of the Bancshares/Xxxx Agreement.)
4. TERMINATION OF THIS AGREEMENT. Bancshares may terminate this Agreement
effective on an annual anniversary of the date of this Agreement by providing
Xx. Xxxxxxx with written notice of Bancshares' decision to terminate this
Agreement provided such notice of termination is made at least sixty (60) days
before an annual anniversary date of this Agreement.
5. ATTORNEYS' FEES. In any action at law or in equity, including any
arbitration proceeding, to enforce any of the provisions or rights under this
Agreement, the unsuccessful party to the action, as determined by the court or
the arbitrator in its final judgment or decree, shall pay the successful party
all costs, expenses and reasonable attorneys' fees incurred by the successful
party (including, without limitation, costs, expenses and fees on any appeal),
and, if the successful party shall recover judgment in any such action or
proceeding, such costs, expenses and attorneys' fees shall be included as part
of the judgment.
6. AMENDMENTS. No change in, modification of or addition to the terms of
this Agreement shall be valid unless set forth in a writing signed by Bancshares
and Xx. Xxxxxxx and specifically stating that it constitutes an amendment to
this Agreement.
7. CHOICE OF LAW. It is the intention of the parties that the laws of the
State of California shall govern the validity of this Agreement, the
construction of its terms and the interpretation of the rights and duties of the
parties.
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8. BINDING ON HEIRS, SUCCESSORS AND ASSIGNS. This Agreement and all of its
terms, conditions and covenants are intended to be fully effective and binding,
to the extent permitted by law, on the heirs, executors, administrators,
successors and assigns of the parties to this Agreement.
9. ASSIGNMENT. Except as otherwise provided in this Agreement, neither
this Agreement nor any right or interest is assignable by any of the parties
without the prior written consent of all of the parties.
10. ARBITRATION. Any dispute between the parties arising out of or in
connection with this Agreement shall be referred to arbitration in Santa Xxxxx
County, California in accordance with the Commercial Rules of the American
Arbitration Association. The award shall be final and binding upon the parties
and judgment of such award may be entered in any court having jurisdiction.
IN WITNESS WHEREOF, the parties have executed this Agreement effective as of
the date and year first above written.
SILICON VALLEY BANCSHARES XXXXX X. XXXXXXX, XX.
By:
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