EXHIBIT 10.1
SEPARATION AGREEMENT
EXHIBIT 10.1
SEPARATION AGREEMENT
SEPARATION AGREEMENT (this "Agreement") made as of the 6th day of
August, 1997 by and between XXXX XXXXXXXXXX, residing at the address indicated
following his signature below (hereinafter referred to as "Employee") and CS
WIRELESS SYSTEMS, INC., a Delaware corporation having its principal place of
business at Xxxxx 000, 000 Xxxxxxxx Xxxxx, Xxxxx, Xxxxx 00000 (hereinafter
referred to as the "Company").
W I T N E S S E T H:
WHEREAS, Employee and the Company are parties to that certain Employment
Agreement dated as of February 23, 1996 (the "Employment Agreement") and a Non-
Qualified Stock Option Agreement dated as of March 19, 1996 (the "Stock Option
Agreement"); and
NOW THEREFORE, in consideration of their mutual promises, and for other
good and valuable consideration, the parties, intending to be legally bound,
agree as follows:
1. TERMINATION OF EMPLOYMENT. The Employment Agreement is hereby
terminated, and shall be of no further force and effect, except as provided in
PARAGRAPH 2 below.
2. NON-DISCLOSURE. The non-disclosure covenants contained in
SUBPARAGRAPH 9(a) of the Employment Agreement shall survive the termination of
the Employment Agreement in accordance with their terms, and the Non-Disclosure
Agreement dated as of February 23, 1996 (the "Non-Disclosure Agreement") between
the parties shall remain in full force and effect.
3. STOCK OPTIONS. The parties acknowledge that options (the
"Original Options") to purchase 215,054 shares of the Company's common stock,
par value $.001 ("Common Stock"), were granted to Employee under the 1996 CS
Wireless Systems, Inc. Incentive Stock Plan, as amended from time to time (the
"Plan"). The parties further acknowledge that of the Original Options, options
to purchase 172,044 shares of Common Stock, at an exercise price of $6.50 per
share, are fully vested (the "Remaining Options") and the balance of the
Original Options, which represent options to purchase 43,010 shares of Common
Stock, are hereby surrendered by Employee to the Company. The Remaining Options
shall continue to be governed by the Plan. The Plan is the same as that which
covers all senior executives of the Company, and any amendments to the Plan will
be applicable to Employee. On the first anniversary of the date of this
Agreement, Employee shall have the option, provided the Company's common stock
is not then publicly traded and the price per share quoted on any applicable
exchange or over-the-counter is greater than $9.50, to (i) hold the Remaining
Options, in which event the Remaining Options shall be exercisable until the
five-year anniversary of this Agreement in accordance with the Plan, or (ii)
deliver written
notice ("Election Notice") to the Company of his election to cancel all, but
not part of, the Remaining Options in consideration for payment by the
Company of $500,000; upon delivery of such payment, the options shall lapse
without further action. The Election Notice must be received by the Company
during regular business hours on or before the first anniversary of the date
of this Agreement or shall not be effective; provided, however, that if such
date falls on a Saturday, Sunday or legal holiday, then the date on which the
Election Notice must be received is on the first business day thereafter. The
Company shall pay $500,000 (less applicable taxes) within ten (10) days of
its receipt of an effective Election Notice. Except as otherwise amended by
this PARAGRAPH 3, the Stock Option Agreement shall remain in full force and
effect.
4. NON-COMPETITION. (a) Notwithstanding anything to the contrary
contained in the Employment Agreement, the non-competition covenants contained
in SUBPARAGRAPH 9(b) of the Employment Agreement shall not survive the
termination of the Employment Agreement and in consideration therefore and the
payment of $500,000 by the Company to Employee on the date hereof, Employee
agrees to be bound by the covenants contained in SUBPARAGRAPH (b) below.
(b) Because Employee's services to the Company are special and
because Employee has access to the Company's confidential information, Employee
covenants and agrees that from the date hereof through February 22, 1999 that he
will not, directly or indirectly, either on his own behalf or on behalf of any
person, partnership, corporation or otherwise, (i) engage in any business or
undertaking directly competitive with the wireless cable television, cable
television, subscription television, direct broadcast satellite, direct-to-home,
wired video programming, non-wired video programming, wireless Internet access,
wireless fixed telephony or other fixed wireless information businesses (the
"Related Business") being carried on by the Company or any subsidiary in any
market serviced by the Company or any subsidiary, at the time of Employee's
termination, or (ii) be employed by or provide consulting services to or be an
investor, limited partner or shareholder in, any entity or other person in any
Related Business within 25 miles of any city in which the Company or any
subsidiary does business at time of execution of this Agreement or has rights to
broadcast or transmit television programming or in which the Company has a
transmission license at the time of Employee's termination, without the prior
written consent of the Board of Directors of the Company. The parties agree
that the time period and geographical area of non-competition specified above
are applicable to the restrictions set forth in (i) and (ii) of the preceding
sentence and are reasonable and necessary in light of the transactions entered
into in this Agreement. If, however, it shall be determined at any time by a
court of competent jurisdiction that either the time period restriction or the
geographical area restriction, or both, are invalid or unenforceable, the
parties agree that any such invalid restriction shall be amended and reformed to
the extent necessary to make same valid and enforceable in the determination of
said court, and such restriction, as so amended, shall be enforceable between
the parties to the same extent as if such amendment had been made as of the date
of this Agreement. This SUBPARAGRAPH 4(b) shall not apply to (i) investments
constituting not more than 5% of the common equity of a publicly traded or
privately held company or (ii) the management and operation of a company engaged
solely in the business of providing
installation and other field services to, or at the request of, any person,
partnership, or corporation engaged in the business of providing video
services through hard wire cable, wireless cable, satellite, or other
distribution networks.
5. RELEASE. (a) Employee hereby releases, remises, and forever
discharges, and by these presents does, for himself, his heirs, executors,
administrators, legal representatives and assigns, release, remise, and forever
discharge the Company, its subsidiaries and Affiliates, its past, present and
future divisions; its past, present and future subsidiary and parent
corporations; its past, present and future Affiliates and related companies; its
successors and assigns; its past, present and future directors, officers,
stockholders, agents and employees both personally and as directors, officers,
stockholders, agents and employees; and the past, present and future directors,
officers, shareholders, agents and employees of its parents, subsidiaries,
divisions, Affiliates, related companies and successors and assigns (hereinafter
collectively referred to as "the Company and/or its Affiliates"), from any
claim, known or unknown, asserted or unasserted, suspected or unsuspected,
arising in any way from any actions taken by the Company and/or its Affiliates
up to and including the date of the execution of this Agreement, including any
claims, demands and causes of action under federal or state law, regulation or
decision including any rights to bring any demands, complaints, causes of
action, claims and charges under Title VII of the Civil Rights Act of 1964, as
amended, 42 U.S.C. section 2000e ET SEQ., the Civil Rights Act of 1991, 42
U.S.C. section 1981a ET SEQ., the Employee Retirement Income Security Act, 29
U.S.C. section 1001 ET SEQ., the Age Discrimination Employment Act of 1967, as
amended, 29 U.S.C. section 601 ET SEQ., the Americans with Disabilities Act of
1990, 42 U.S.C. section 12101 ET SEQ., and any other federal or state law,
regulation or decision, including but not limited to any claims arising out of
his employment or the termination or resignation of his employment, including
claims for wages owed, constructive discharge, wrongful discharge, infliction of
emotional distress, breach of contract, breach of any implied covenant of good
faith and fair dealing, violation of public policy, violation of company policy
or any other common law claims, and any claims, demands or causes of action for
injunctive or declaratory relief, reinstatement, compensation for lost wages,
workers' compensation, employee or fringe benefits, compensatory or punitive
damages, and any claims for attorneys' fees, interest and expenses and costs of
litigation, and any other or additional relief.
(b) Without in any way limiting the scope and effect of this
PARAGRAPH 5, Employee acknowledges that (i) he would not otherwise be entitled
to all of the consideration described in herein, and that the Company is
providing such consideration in return for Employee's agreement to be bound by
the terms of this Agreement; (ii) among the rights he knowingly and voluntarily
waives by executing this Agreement is his right to bring against the Company any
demands, complaints, causes of action, claims and charges under the Age
Discrimination in Employment Act, 29 U.S.C. subsection 621 ET SEQ., or under any
other federal or state law, regulation or decision prohibiting discrimination on
the basis of race, color, religion, sex, age, national origin, sexual
orientation or physical or mental handicap; (iii) he has been advised to consult
with an attorney regarding this Agreement and he has in fact consulted with an
attorney regarding this Agreement; and (iv) he has been given a reasonable
period of time within which to consider this Agreement and if he wanted
additional
time, such time was available to him, up to and including August 27, 1997,
which is more than twenty-one (21) calendar days from August 6, 1997, the
date on which Employee first was provided with this Agreement and Employee
further acknowledges that he does not want more time to consider this
Agreement and that he has requested that the Agreement be executed on this
date. Employee understands that he may revoke this Agreement during the
first seven days after he signs it by delivering written notice of his
revocation to the Company. Employee understands that if he does not revoke
this Agreement within the first seven days after he signs it, it will become
effective on the eighth day after he signs it.
6. DIRECTORSHIP. Employee shall continue to serve, without
compensation, as a member of the Board of Directors of the Company for a minimum
of twelve (12) months from the date hereof, unless otherwise requested to resign
by the Company. In the event Employee shall continue to serve on the Board of
Directors of the Company beyond such twelve-month period, Employee shall be
entitled to compensation for such service on the same terms as the Company's
other non-employee members of the Board of Directors in accordance with the
Company's policies as may be in effect from time to time. Notwithstanding
anything herein which may be construed to the contrary, Employee shall be
entitled, to the extent permitted by applicable law, to the benefits of the
Company's Certificate of Incorporation, By-laws and director and officer
liability insurance coverage in connection with any claim asserted against
Employee in his capacity as an officer or director of the Company. The Company
will reimburse employee for all out-of-pocket expenses for fulfilling his role
as a Director in accordance with the Companies policy.
7. NOTICES. Any notice permitted or required hereunder shall be
deemed sufficient when hand-delivered or mailed by certified mail, postage
prepaid, and addressed if to the Company at the address indicated above and if
to Employee at the address indicated below (or to such other address as may be
provided by notice).
8. MISCELLANEOUS. This Agreement (i) together with the Non-
Disclosure Agreement, constitutes the entire agreement between the parties
concerning the subjects hereof and supersedes any and all prior agreements or
understandings, (ii) may not be assigned by Employee without the prior written
consent of the Company and (iii) may be assigned by the Company and shall be
binding upon, and inure to the benefit of, the Company's successors and assigns.
Headings herein are for convenience of reference only and shall not define,
limit or interpret the contents hereof.
9. AMENDMENT. This Agreement may be amended, modified or
supplemented by the mutual consent of the parties in writing, but no oral
amendment, modification or supplement shall be effective.
10. SPECIFIC PERFORMANCE. The parties acknowledge that the Company
would be irreparably damaged and there would be no adequate remedy at law for
Employee's breach of PARAGRAPH 4 of this Agreement, and accordingly, the terms
thereof shall be specifically enforced. Employee hereby consents to the entry
of any temporary restraining order or preliminary or ex parte injunction, in
addition to any other remedies available at law or in
equity, to enforce the provisions hereof.
11. AFFILIATES. As used herein, the term "Affiliate" shall mean any
individual or entity controlling, controlled by or under common control with the
Company, now or in the future, including without limitation, partnerships in
which the Company or any Affiliate may invest as a limited or general partner
and limited liability companies in which the Company or any Affiliate may become
a member.
12. SEVERABILITY. The provisions of this Agreement are severable.
The invalidity of any provision shall not affect the validity of any other
provision.
13. GOVERNING LAW. This Agreement shall be construed and regulated
in all respects under the laws of the State of Texas.
IN WITNESS WHEREOF, this Agreement is entered into as of the date and year
first above written.
CS WIRELESS SYSTEMS, INC.
By: /s/ XXXXX XXXX
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Name: Xxxxx Xxxx
Title: President and Chief Executive
Officer
EMPLOYEE:
/s/ XXXX XXXXXXXXXX
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Name: Xxxx Xxxxxxxxxx
Address: 000 Xxxx Xxxxxx
Xxxxxxx, XX 00000
