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EXHIBIT 10.34
SEPARATION AGREEMENT
This Separation Agreement (Agreement) is entered into effective as of
August 9, 1999, by and between Xxxxx X. Xxxxxxx (Xxxxxxx), and Xxxxxxx.xxx,
Inc., a Delaware corporation (the Company), with regard to the following:
R E C I T A L S
1. Xxxxxxx was employed as Executive Vice President and President
Internet Operations of the Company.
2. Xxxxxxx continues to serve as a member of the Board of Directors of
the Company.
3. Xxxxxxx and the Company are parties to an Employment Agreement dated
May 17,1999 (Employment Agreement) and a Proprietary Information and Inventions
Agreement dated May 17, 1999 (Inventions Agreement).
4. Xxxxxxx was granted options to acquire 750,000 shares of the
Company's Common Stock at an exercise price of $3.25 per share pursuant to a
Notice of Grant of Stock Option dated May 17, 1999 (the Stock Option).
5. Xxxxxxx voluntarily resigned from his employment with the Company
effective August 13, 1999.
6. In connection with Xxxxxxx'x separation from the Company, the
Company and Xxxxxxx have agreed to the releases, the cancellation of stock
options and the payments set forth herein.
Therefore, in consideration of the premises recited above, the mutual
exchange of promises contained in this Agreement and other valuable
consideration, the receipt and adequacy of which are acknowledged by the Company
and Xxxxxxx, the parties agree as follows:
AGREEMENT
1. Resignation. Xxxxxxx hereby acknowledges his voluntarily resignation
from his employment with the Company as Executive Vice President and President
Internet Operations, effective August 13, 1999.
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2. Payment.
2.1 The Company shall continue to pay Xxxxxxx his regular base
salary and health insurance coverage, subject to any employee contribution
provisions, through February 13, 2000.
2.2 The Company shall also pay to Xxxxxxx the xxxxx sum of
$124,930.00, less applicable deductions and withholdings, to reimburse Xxxxxxx
for relocation expenses incurred in connection with his relocation to Orange
County, California.
3. Waiver of Rights Under Employment Agreement; No Other Benefits.
Except for the continuing obligations of Xxxxxxx under Article III of the
Employment Agreement and under the Inventions Agreement, which Xxxxxxx hereby
reaffirms, the parties agree that the Employment Agreement is terminated in its
entirety as of August 13, 1999, and Xxxxxxx expressly waives any notice periods
for termination or resignation under the Employment Agreement. Xxxxxxx agrees
that he is not entitled to receive, and will not claim, any damages, profits,
compensation, bonuses, benefits, vacation, stock options or rights other than
what is expressly set forth in this Agreement. Xxxxxxx acknowledges that the
consideration he is receiving under this Agreement is in lieu of, and he hereby
waives any other rights he may have had under, the Employment Agreement, and any
other agreements, express or implied, he may have had with the Company except
for any agreements or resolutions adopted by the Company's Board of Directors
providing rights of indemnification to officers and directors of the Company
that were in effect during the term of Xxxxxxx'x employment or directorship.
This Agreement supersedes all rights and/or benefits Xxxxxxx may have or claim
arising out of the Employment Agreement.
4. Stock Options. The Company and Xxxxxxx acknowledge and agree that
(i) the option to acquire 150,000 shares of Company Common Stock vesting upon
the closing of the Company's initial public offering (the IPO Option), which was
granted as a part of the Stock Option, shall remain in full force and effect
following the execution of this Agreement and shall be exercisable in accordance
with its terms, and (ii) the balance of the Stock Option to acquire 600,000
shares of Company Common Stock shall expire and be of no further force and
effect upon the execution of this Agreement.
5. Allocation of Directed Shares. If within six months of the date
hereof the Company shall close an initial public offering of its Common Stock,
Xxxxxxx shall be allowed to designate the recipients of shares pursuant to the
Company's Directed Share Program in the same manner and amount as members of the
Company's executive management team that report directly to the Company's Chief
Executive Officer.
6. Other Agreements. Xxxxxxx and the Company each promise and covenant
not to make any harassing or disparaging statements concerning the other.
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7. Return of Company Property; Expenses.
7.1 Concurrently with, or prior to, execution of this Agreement,
Xxxxxxx shall return to the Company all Company property and equipment in his
possession or under his control, including, but not limited to, any cell phones,
computers and pagers.
7.2 On or before August 31, 1999, Xxxxxxx must submit to the Company
all outstanding business expenses for reconciliation and payment. Expenses
submitted thereafter will not be reimbursed. The Company will pay only for
business expenses incurred through August 13, 1999. Reimbursement of business
expenses will be made by September 10, 1999.
8. Releases.
8.1 General Release by Xxxxxxx. Excepting only the obligations
undertaken by the Company in accordance with this Agreement and the IPO Option
and except for any obligation to indemnify Xxxxxxx pursuant to the Company's
Certificate of Incorporation or Bylaws as in effect as of the date hereof, which
obligations shall not be released or, except as specifically set forth in this
Agreement, altered or amended in any way by this Agreement, and in exchange for
the consideration provided to Xxxxxxx in this Agreement, Xxxxxxx hereby
releases, acquits, relieves and forever discharges the Company and its
successors, heirs, assigns, employees, officers, directors, agents,
representatives, stockholders, attorneys, stock option plans, affiliated
corporations, divisions or organizations, whether previously or hereinafter
affiliated in any manner (collectively, the Company Released Parties), from any
and all claims, rights, actions, complaints, demands, causes of actions, wage
claims, obligations, promises, contracts, agreements, controversies, suits,
debts, expenses, damages, attorneys' fees, costs and liabilities of any nature
whatsoever, matured or unmatured, fixed or contingent, which Xxxxxxx ever had,
now has, or may claim to have from the beginning of time to the moment he signs
this Agreement against the Company Released Parties (whether directly or
indirectly), or any of them, by reason of any act, event or omission concerning
any matter, cause or thing, including, without limiting the generality of the
foregoing, any claims related to or arising out of (i) Xxxxxxx'x employment with
the Company or the cessation of that employment; (ii) any common law torts,
including, without limitation, infliction of emotional distress; (iii) any
federal, state or governmental constitution, statute, regulation or ordinance,
including, without limitation, Title VII of the Civil Rights Act of 1964, the
Fair Labor Standards Act of 1938, the Employee Retirement Income Security Act,
the California Labor Code, the California Fair Employment and Housing Act and
the Age Discrimination in Employment Act of 1967, the Wage, Pay and Collection
Act of the State of Delaware, and any other federal, state or local employment
practice legislation; (iv) any agreement, express or implied, between Xxxxxxx
and any of the Company Released Parties; (v) any impairment of his ability to
compete in the open labor market; or (vi) any permanent or temporary disability
or loss of future earnings as a result of injury or disability arising from or
associated with his employment or termination of his employment relationship
with the Company.
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8.2 Xxxxxxx'x Release of Unknown Claims. Xxxxxxx hereby waives and
relinquishes all rights and benefits afforded by Section 1542 of the Civil Code
of California. Xxxxxxx hereby acknowledges that he understands the significance
and consequences of this specific waiver of Section 1542. Section 1542 of the
Civil Code of California 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.
Notwithstanding the provisions of Section 1542, and for the purpose of
implementing a full and complete release and discharge of the Company Released
Parties (except as provided in Section 8.1, above), Xxxxxxx expressly
acknowledges that the Release contained in this Agreement is intended to include
in its effect, without limitation, all claims covered by the release set forth
in Section 8.1 above which Xxxxxxx does not know or suspect to exist in his
favor.
8.3 Xxxxxxx'x Covenant To Forebear. Xxxxxxx further agrees not to
institute, maintain, or aid any action at law or in equity or any legal
proceeding whatsoever against any or all of the Company Released Parties (as
defined in Section 8.1, above), which is based on, in whole, or in part, or
which arises out of, or is connected with, the claims hereby released.
8.4 Xxxxxxx'x Representation and Warranty Regarding Assignment of
Claims. Xxxxxxx represents and warrants that he has not assigned any claims made
the subject of Section 8.1 of this Agreement or authorized any other person or
entity to assert any such claim on behalf of him. Further, Xxxxxxx agrees that
by the releases contained in this Section 8.1 he waives any claim for damages
incurred at any time after the date on which he signs this Agreement because of
alleged continuing effects of any alleged acts or omissions involving the
Company that occurred on or before the date on which he signs this Agreement,
and any right to xxx for monetary or injunctive relief against the alleged
continuing effects of acts or omissions that occurred before the date on which
he signs this Agreement.
9. No Employment Rights. Xxxxxxx acknowledges that effective as of
August 13, 1999, he will no longer be an employee of the Company for any
purpose. Nothing in this Agreement shall be construed to continue, create or
imply any contract of employment between Xxxxxxx and the Company.
10. Assistance/Cooperation With Litigation. In connection with the
Company's participation in current or future litigation relating to events which
occurred during Xxxxxxx'x employment or about which Xxxxxxx has information,
Xxxxxxx agrees to cooperate fully and devote such time as may be reasonably
required in the preparation, prosecution or defense of the Company's case or
cases, including, but not limited to, the execution of truthful declarations or
providing information and/or documents requested by the Company. The Company
shall reimburse Xxxxxxx, promptly upon receipt of satisfactory evidence thereof,
for all reasonable expenses (not including any amount for Xxxxxxx'x time)
incurred by Xxxxxxx in connection with such assistance and/or cooperation with
the Company with respect to such litigation.
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11. No Admission. Nothing contained in this Agreement or the fact that
the parties have signed this Agreement shall be considered an admission of any
liability whatsoever.
12. Fees and Costs. Xxxxxxx and the Company agree that in the event of
litigation relating to a breach of this Agreement, the prevailing party shall be
entitled to its attorneys' fees and costs.
13. Successors and Assigns. This Agreement, and all the terms and
provisions hereof, shall be binding upon and shall inure to the benefit of the
parties and their respective heirs, legal representatives, successors and
assigns.
14. Waiver. No waiver of any of the provisions of this Agreement shall
be deemed, or shall constitute, a waiver of any other provision, whether or not
similar. No waiver shall constitute a continuing waiver. No waiver shall be
binding unless executed in writing by the party charged with the waiver.
15. Severability. In the event any provision of this Agreement shall
finally be determined by a court of competent jurisdiction to be unlawful, such
provision shall be deemed to be severed from this Agreement and every other
provision of this Agreement shall remain in full force and effect. If, moreover,
any one or more of the provisions contained in this Agreement shall for any
reason be held by a court of competent jurisdiction to be excessively broad, it
shall be construed, by limiting and reducing it, so as to be enforceable to the
extent compatible with the applicable law as it shall then appear.
16. Miscellaneous.
16.1 Entire Agreement. This Agreement constitutes the entire
agreement and supersedes all prior written or oral and all contemporaneous oral
agreements, understandings and negotiations between the parties with respect to
the subject matter of this Agreement;
16.2 Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed an original, and all of which shall constitute one
and the same instrument;
16.3 Amendment. This Agreement may not be amended except by an
agreement in writing signed by the parties to this Agreement or their respective
successors-in-interest and expressly stating that it is an amendment of this
Agreement; and
16.4 Governing Law. This Agreement shall be governed in all
respects, including validity, interpretation and effect, by the laws of the
State of California.
16.5 Survival of Representations and Warranties. All
representations and warranties contained in this Agreement shall survive the
execution and delivery of this Agreement.
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17. Notices. All notices, requests, demands and other communications
under this Agreement must be in writing and shall be deemed to have been duly
given (i) on the date of service if served personally on the party to whom
notice is to be given; (ii) on the second business day following delivery to a
courier or messenger service guaranteeing overnight delivery; (iii) on the date
of confirmation of receipt if sent by telecopy or telex and; and (iv) on the
date of receipt or refusal indicated on the return receipt if mailed to the
party to whom notice is to be given by first-class mail, registered or
certified, postage prepaid, return receipt requested, and in each case, properly
addressed as follows:
If to the Company: Xxxxxxx.xxx, Inc.
000 Xxxxx Xxxx., 00xx Xxxxx
Xxxxx Xxxx, XX 00000
Attn: President
with a copy to: Xxxxxx & XxXxxxx, LLP
00000 XxxXxxxxx Xxxx., Xxxxx 0000
Xxxxxx, XX 00000
Attn: Xxxx X. Xxxx, Esq.
If to Xxxxxxx:
with a copy to:
Any party may change its address for the purpose of this
Agreement by giving the other party written notice of the new address in the
manner set forth above.
This Agreement has been executed as of the day first hereinbefore
written.
Dated:______________________ COMPANY
XXXXXXX.XXX, INC.,
a Delaware corporation
By: /s/ XXXX X. XXXXXXXXX
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Its: EVP Finance and CFO
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XXXXXXX
Dated:______________________ /s/ XXXXX X. XXXXXXX
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Xxxxx X. Xxxxxxx
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