SEPARATION AGREEMENT AND GENERAL RELEASE
Exhibit
10.39
Borders
Group, Inc., its affiliates, subsidiaries, divisions, successors and assigns
and
the past, present and future employees, officers, shareholders, directors,
agents, attorneys and insurers thereof, both individually and in their official
capacities (collectively referred to throughout this Separation Agreement and
General Release as “Borders Group”) and Xxxxxx X. Xxxxxxx (referred to
throughout this Separation Agreement and General Release as “Vanzura” and more
specifically defined in paragraph 6) agree that:
1. Separation
from Employment.
This
Separation Agreement and General Release (“Agreement”) is made by Borders Group
and Vanzura based on Vanzura’s separation of employment with Borders Group
effective September 5, 2007 (the “Effective Date”).
2. Consideration.
In
consideration for signing this Agreement and compliance with the promises made
herein, Borders Group agrees that Vanzura: (a) will continue to receive his
current salary through the Effective Date; (b) subject to the mitigation
provisions set forth below, the provisions of paragraph 11, Discontinuance
of
Severance Payments, and the provisions of paragraph 3, Timing of Severance
Payments, as Monthly Severance Pay, after the expiration of the revocation
period set forth in paragraph 5, Revocation and provided that no revocation
occurs, twelve (12) months salary and bonus in the amount of eighty-four
thousand and three hundred and seventy-five dollars and no cents ($84,375.00)
per month (thirty-eight thousand nine hundred and forty-two dollars and
thirty-one cents ($38,942.31) per normal bi-weekly pay period for twenty-six
(26) periods) minus, in each case, the amount of applicable withholding taxes;
and (c) will receive a cash payment as soon as practicable following Vanzura’s
separation from Borders Group, in an amount equal to the Fair Market Value
(as
determined by the closing price for Borders Group, Inc. (“BGP”) shares on the
New York Stock Exchange on the day prior to Vanzura’s termination date) of the
Restricted Shares (but not the restricted share units) awarded to Vanzura in
March 2006. The amount of severance payments described in (b) above shall be
reduced by the amount that Vanzura receives from other employment during such
period. Vanzura agrees to make reasonable efforts to seek other employment,
and
to immediately notify Borders Group if he accepts other employment and the
amounts received therefrom. Except for the payments described in (a), (b),
and
(c) above, Vanzura shall not be entitled to any payments of any nature
whatsoever from Borders Group.
3. Timing
of Severance Payments.
Monthly
Severance Pay, as set forth in subparagraph 2(b), Monthly Severance Pay, above,
shall commence the month following termination and shall continue for twelve
months, provided that however, if the monthly payment period would otherwise
extend beyond the latter of (a) March 15, 2008, or (b) two and a half months
following the end of the current fiscal year, an amount equal to the sum of
the
remaining payments that would have been made to Vanzura shall, in lieu thereof,
be paid to him in one lump sum on the last day of the month immediately
preceding the month in which the later of the dates specified in (a) or (b)
above falls. In calculating the amount of any lump sum payment, it shall be
assumed that any income Vanzura is earning from other employment on the payment
date would continue for the remainder of the twelve-month (12) period following
Vanzura’s separation. No repayment shall be required if Vanzura’s income
increases after the lump sum payment date, and no additional payment shall
be
made by Borders Group after the lump sum payment.
4. No
Consideration Absent Execution of this Agreement.
Vanzura
acknowledge and agree that, prior to the signing of this Agreement, Vanzura
did
not have a contract for employment for any definite period of time. As such
Vanzura understands and agrees that Borders Group would not be obligated to
employ him through the Effective Date and he would not be eligible for the
payments provided for herein except for his execution of this
Agreement.
5. Revocation.
Vanzura
may revoke this Agreement for a period of seven days following the day he
executes this Agreement. Any revocation within this period must be submitted,
in
writing, to Borders Group and state, “I hereby revoke my acceptance of the
Agreement.” The revocation must be personally delivered to Xxxxxx Xxxxx or his
designee, or mailed to Xxxxxx Xxxxx and postmarked within seven days of
execution of this Agreement. This Agreement shall not become effective or
enforceable until the revocation period has expired. If the last day of the
revocation period is a Saturday, Sunday, or legal holiday in Michigan, then
the
revocation period shall not expire until the next following day which is not
a
Saturday, Sunday, or legal holiday.
6. General
Release of Claims.
Vanzura knowingly and voluntarily releases and forever discharges Borders Group
of and from any and all claims, known and unknown,
against
Borders Group, which Vanzura, his heirs, executors, administrators, successors,
and assigns (referred to collectively throughout this Agreement as “Vanzura”)
have or may have as
of the date of execution of this Agreement,
including, but not limited to, any alleged violation of:
· |
The
National Labor Relations Act, as amended;
|
· |
Title
VII of the Civil Rights Act of 1964, as
amended;
|
· |
The
Civil Rights Act of 1991;
|
· |
Sections
1981 through 1988 of Title 42 of the United States Code, as
amended;
|
· |
The
Employee Retirement Income Security Act of 1974, as
amended;
|
· |
The
Immigration Reform Control Act, as
amended;
|
· |
The
Americans with Disabilities Act of 1990, as
amended;
|
· |
The
Age Discrimination in Employment Act of 1967, as
amended;
|
· |
The
Occupational Safety and Health Act, as
amended;
|
· |
The
Fair Credit Reporting Act;
|
· |
The
Family and Medical Leave Act of 1933;
|
· |
The
Equal Pay Act, as amended;
|
· |
The
Worker Adjustment and Retraining Notification Act, as
amended;
|
· |
The
Michigan Xxxxxx-Xxxxxx Civil Rights Act;
|
· |
The
Michigan AIDS Testing and Confidentiality
Act;
|
· |
The
Michigan Persons with Disabilities Civil Rights Act, as amended;
|
· |
The
Michigan Equal Pay Law;
|
· |
The
Michigan Comp. Xxxx Xxx. “Whistleblowers Protection Act” provision (sec.
15-361-15.369);
|
· |
The
Michigan Comp. Xxxx Xxx. “Workers’ Compensation: Retaliation” provision
(sec. 418.301(11) and (12));
|
· |
Any
other federal, state or local civil or human rights law or any other
local, state or federal law, regulation or
ordinance;
|
· |
Any
public policy, contract, tort, or common law;
or
|
· |
Any
allegation for costs, fees or other expenses including attorneys’ fees
incurred in these matters.
|
· |
Any
claims arising from or related to tax obligations to any payment made
hereunder, including but not limited to any acceleration of income
or
social insurance taxes, or increase in income taxes, or interest and
penalties imposed with respect to any of his severance benefits (as
determined under the guidance issued under Section 409A including,
but not
limited to, the plan aggregation rules under Section
409A).
|
Without
limiting the generality of the foregoing, Vanzura hereby releases any and all
claims he may have against Borders Group pertaining in any way to his employment
with Borders Group or the termination thereof, whether known or unknown at
the
time of this Agreement, and Vanzura assumes the risk that he might subsequently
discover claims or causes of action which are presently unknown to him.
Accordingly, Vanzura voluntarily agrees that this release extends to all claims,
whether known to him or unknown, existing at the time of this Agreement.
Notwithstanding
the foregoing or any other provision of this Agreement, Vanzura is not waiving
or releasing any benefits to which he may be entitled under the Borders Group
Savings Plan or any medical or other welfare benefit plan of Borders Group.
7.
Vanzura’s
Acknowledgment of Tax Liability.
Vanzura
hereby acknowledges and agrees as follows: (a) nothing in this Agreement
constitutes tax advice; (b) Borders Group does not take any responsibility,
or
have any liability to Vanzura with respect to his Tax Liability and/or his
personal tax reporting; (c) Vanzura has been given the opportunity and
encouraged to consult with his own attorney and to seek professional tax advice
prior to execution of this Agreement; and (d) Vanzura agrees to indemnify
Borders Group and hold it harmless from any liability for income taxes, interest
or penalties that may be imposed as a result of under-payment or non-payment
of
income taxes on any amounts paid Vanzura under the terms of this Agreement.
8.
Affirmations.
Vanzura
affirms that he has not filed, caused to be filed, or presently is a party
to
any claim, complaint, or action against Borders Group in any forum or form.
Vanzura further affirms that he has been paid and has received all leave (paid
or unpaid), vacation pay, compensation, wages and bonuses to which he may be
entitled and that no other leave (paid or unpaid), vacation pay, compensation,
wages or bonuses are due to him, except as provided in this Agreement. Employee
furthermore affirms that he has no known workplace injuries or occupational
diseases; and has been provided and/or has not been denied any leave requested
under the Family and Medical Leave Act.
9. Confidentiality
and Return of Property.
Vanzura
agrees that he will maintain in strict confidence and will not, directly or
indirectly, divulge, transmit, publish, release or otherwise use or cause to
be
used in any manner, any confidential information relating to Borders Group
clients, customers, proprietary knowledge and trade secrets, research, business
plans, business methods, operating procedures or programs, merchandising
strategies, pricing strategies, technology, software systems, operations,
processes, computer programs and data bases, records, development data and
reports, store designs, quality control specifications, cost analysis, flow
charts, know-how, employee lists, customer lists, supplier lists, marketing
data, personnel data, or any other information of like nature. Vanzura
acknowledges that all information regarding Borders Group compiled or obtained
by, or furnished to, him in connection with his employment or association with
Borders Group is confidential information and Borders Group's exclusive
property. Upon demand by Borders Group, Vanzura will surrender to Borders Group
all original and facsimile records, documents and data in his possession
pertaining to Borders Group. The foregoing covenant of confidentiality has
no
temporal, geographical or territorial limitation.
10. Confidentiality
of this Agreement.
Vanzura
agrees that he will maintain in strict confidence and will not, directly or
indirectly, divulge, transmit, publish, release or otherwise disclose, the
terms
of this Agreement except to his spouse, domestic partner (as defined by Borders
Group Inc. benefits plans), tax advisor and an attorney with whom Vanzura
chooses to consult regarding his consideration of this Agreement, provided
that
said individuals agree to be bound by the terms of this Confidentiality Clause
and Vanzura agrees to be liable for any breach by them.
11. Discontinuance
of Severance Payments.
Vanzura
agrees that any right to receive severance payments hereunder will cease if,
during the one-year period following his termination of employment, he directly
or indirectly becomes an employee, director, advisor of, or otherwise affiliated
with, any other entity or enterprise whose business is in competition with
the
business of Borders Group.
12. Governing
Law and Interpretation.
This
Agreement shall be governed and conformed in accordance with the laws of the
State of Michigan without regard to its conflict of laws provision. Should
any
provision of this Agreement be declared illegal or unenforceable by any court
of
competent jurisdiction and cannot be modified to be enforceable, excluding
the
general release language, such provision shall immediately become null and
void,
leaving the remainder of this Agreement in full force and effect.
13. No
Admission of Wrongdoing.
Vanzura
agrees that neither this Agreement nor the furnishing of the consideration
for
this Release shall be deemed or construed at anytime for any purpose as an
admission by Borders Group of any liability or unlawful conduct of any
kind.
14. Amendment.
This
Agreement may not be altered, modified or changed except upon express written
consent of both parties wherein specific reference is made to this
Agreement.
15. Entire
Agreement; Termination of Prior Agreements.
This
Agreement sets forth the entire agreement between the parties hereto, and fully
supersedes any prior written or oral agreements or understandings between the
parties, which are hereby terminated and of no further force and effect,
including but not limited to the employment agreement dated August 1, 2006.
Vanzura acknowledges that he has not relied on any representations, promises,
or
agreements of any kind made to him in connection with his decision to sign
this
Agreement, except for those set forth in this Agreement.
VANZURA
HAS BEEN ADVISED IN WRITING THAT HE HAS AT LEAST FORTY-FIVE ONE (45) CALENDAR
DAYS TO CONSIDER THIS AGREEMENT, IN WHICH YOU WAIVE IMPORTANT RIGHTS, INCLUDING
THOSE UNDER THE AGE DISCRIMINATION IN EMPLOYMENT ACT OF 1967. WE ADVISE YOU
TO
CONSULT WITH AN ATTORNEY PRIOR TO EXECUTION OF THIS
AGREEMENT.
VANZURA
AGREES THAT ANY MODIFICATIONS, MATERIAL OR OTHERWISE, MADE TO THIS AGREEMENT
DO
NOT RESTART OR AFFECT IN ANY MANNER THE ORIGINAL FORTY FIVE (45) DAY
CONSIDERATION PERIOD.
HAVING
ELECTED TO EXECUTE THIS AGREEMENT, TO FULFILL THE PROMISES SET FORTH HEREIN,
AND
TO RECEIVE THEREBY THE SUMS AND BENEFITS SET FORTH IN PARAGRAPH “2” ABOVE,
VANZURA FREELY AND KNOWINGLY, AND AFTER DUE CONSIDERATION, ENTERS INTO THIS
AGREEMENT INTENDING TO WAIVE, SETTLE AND RELEASE ALL CLAIMS HE HAS OR MIGHT
HAVE
AGAINST BORDERS GROUP.
IN
WITNESS WHEREOF, the
parties hereto knowingly and voluntarily executed this Agreement as of the
date
set forth below:
/s/XXXXXX
X.
XXXXXXX
Xxxxxx
X.
Xxxxxxx
Date: August
27,
2007
BORDERS
GROUP, INC.
By:
/s/XXXXXX
XXXXX
Xxx
Xxxxx
Date:
August
27,
2007