AMENDED AND RESTATED SETTLEMENT AGREEMENT
This Amended and Restated Settlement Agreement (the "Agreement") is
being made this 30th day of June, 2006 (the "Effective Date") by and between
ICOA, Inc., a Nevada corporation ("Company"), with an address at 000 Xxxxxxx
Xxxx, Xxxxxxx, XX 00000 and Xxxxxxx X. Xxxxxxxx ("Employee"), with an address at
00 Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxxxxxxxx.
STATEMENTS OF FACT:
A. On or about October 25, 2005 Company and Employee entered into that certain
Employment Agreement (the "Employment Agreement") and ICOA Employee Agreement
setting forth the terms and conditions of Employee's employment with the Company
and further setting forth such parties' rights and obligations in the event of a
termination of such employment.
B. On or about June 26, 2006, Employee resigned from his employment with the
Company, and the Company accepted such resignation.
C. At the time of resignation, the Company and Employee agreed on certain
aspects of a settlement and severance package and the Company required Employee
to sign a settlement agreement contingent on Employee having an opportunity to
review same, consult an attorney and request changes thereto.
D. This Amended and Restated Settlement Agreement represents the revisions
agreed to by all parties after each party had the time to consult with an
attorney and obtain independent representation.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto agree as follows:
1. Resignation from Employment. Company hereby accepts Employee's resignation
from employment with Company effective June 26, 2006. Employee resigns as an
officer of the Company as of June 26, 2006.
2. Severance Benefits and Unpaid Compensation and Expenses. In consideration of
the Employee's resignation, and in lieu of any amounts that might have become
due under the Employment Agreement between the Company and Employee, the Company
agrees to pay and provide the following to Employee:
a. pay to Employee, in accordance with terms set forth in Section 3,
all accrued and unpaid salary due to Employee as of the date hereof in
the amount of $78,000 (the "Outstanding Salary");
b. pay to Employee, in accordance with terms set forth in Section 3,
severance by paying to Employee an amount equal to his current salary
of $12,000 per month for a period of five months (the "Severance");
c. pay to Employee, in accordance to the terms set forth in Section 3,
all accrued expenses now due and owing to Employee and any other
expenses incurred by Employee through June 23, 2006, in the amount of
$13,186 (the "Outstanding Expenses"). In the event that Employee has
incurred expenses which are too recent to document, Employee shall
advise and present to Company such expenses within thirty (30) days of
the Effective Date.
d. Company shall keep employee on its health plan through November 30,
2006 in the same manner and at the same level (family, individual,
medical dental, etc) as Employee currently maintains and Company shall
pay for such coverage in full. Thereafter, Employee shall be given
information and the right to participate in such health plans under
COBRA or other similar state or federal law.
e. 500,000 shares of the Company were to be granted to Employee on his
six month anniversary with the Company pursuant to the Employment
Agreement. The Company will re-price the 500,000 shares that were due
Employee to the closing price of June 23, 2006. The stock will be
issued to Employee at the restated price no later than one week from
closing.
f. To the extent that during the three (3) months prior to or after the
Effective Date the Company reimburses or agrees to reimburse an officer
or former officer of the Company for his or her legal fees in
connection with his or her separation from the Company, the Company
shall promptly reimburse Employee for his legal fees incurred in
connection with this Agreement in the same amount that such other
officer or former officer received or is entitled to receive.
3. Payment Schedule
a. On the date hereof the Company shall pay to Employee $14,000 to be
allocated against Outstanding Expenses.
b. The Company shall (i) pay all Outstanding Expenses before paying
any Severance Pay, Outstanding Consulting Fees or Outstanding
Salary, and accrued interest thereon, (ii) pay all Outstanding
Severance and accrued interest thereon, before paying any
Outstanding Consulting Fees or any Outstanding Salary, and
interest thereon, and (iii) pay all Outstanding Consulting Fees
and accrued interest thereon before paying any Outstanding Salary
and interest thereon.
c. Employee acknowledges that Company cannot make full payment of all
sums due hereunder immediately. Therefore, within fourteen (14)
calendar days after the Effective Date, the Company shall deliver
to Employee a schedule of payments to be made to Employee during
the Quarter ending September 30, 2006. Prior to each of September
30, 2006, and December 31, 2006, March 31, 2007, and June 30,
2007, the Company shall deliver to Employee a schedule of payments
to be made to Employee of any unpaid Severance, Outstanding
Expenses, and Outstanding Salary, and accrued interest thereon,
during the calendar quarter immediately following such date.
d. Notwithstanding anything contained in this Agreement to the
contrary, the Company shall pay Employee no less than $5,000 in
each month during the term of this Agreement until paid in full
(each a "Minimum Payment").
e. All sums due hereunder, other than accrued and unpaid expenses,
shall bear interest at the rate of 12% per annum until paid in
full, or the maximum rate allowed by law if less. All sums due and
owing hereunder for accrued but unpaid expenses shall bear
interest at the rate of 15% per annum until paid in full, or the
maximum amount of interest allowed by law if less.
f. Failure to provide a payment schedule within the specified time
period as set forth in this Section 3, and/or failure to make the
Minimum Payment or payment set forth in any schedule provided
pursuant to this Section 3, whichever is greater, within ten (10)
days of each due date, will be deemed a default hereunder and will
result in all sums to be paid to Employee becoming immediately due
and payable to Employee in full and will entitle Employee to all
rights and remedies available to it hereunder, at law or in
equity.
g. Company will withhold taxes on the amounts paid in accordance with
all applicable local, state and federal laws.
4. Indemnity.
a. To the full extent permitted by law, the Company hereby
indemnifies and holds harmless Employee from any and all claims,
costs, expenses, liabilities, judgments, investigations,
settlements, suits or actions (including, without limitation, any
costs incurred in enforcing this indemnity) arising from or
related to Employee's employment with the Company, Employee's
position as a consultant to the Company or any other matter
related to the Company or arising from action taken by the Company
wherein Employee may be named as a party or a witness. This
indemnification does not extend to illegal acts or actions taken
in contravention of any laws including those of the United States,
the State of Rhode Island, or applicable SEC regulations.
b. In addition, and not by way of limitation, the Company reaffirms
the continued indemnification originally contained in the
Company's letter to Employee dated October 25, 2006 as well as
that certain ICOA Indemnification Agreement (the "Indemnification
Agreement") between Company and Employee dated October 25, 2005
with regard to any claims, penalties or other liabilities arising
out of obligations owed by the Company to federal, state or local
governments for taxes (including taxes on payroll, income, sales
and use) which were or should have been accrued on or before
October 31, 2005.
c. In the event that it shall be necessary for a Party to this
Agreement to institute legal action to enforce any of the terms
and conditions or provisions contained herein, or for any breach
thereof, the prevailing party shall be entitled to costs and
reasonable attorney's fees.
5. Termination of the Employment Agreement. All provisions of the
Employment Agreement and Xxxxxxxx Employment Agreement, including,
without limitation, Section 5 of the Employment Agreement
concerning no conflict of interest, are terminated and of no
further force and effect.
6. Non-Solicitation. Beginning on the Effective Date and terminating
on a date five months from the Effective Date, Employee will not
solicit, encourage, or cause others to solicit or encourage any
employees, independent contractors, or clients of the Company to
terminate their employment, contractual, or client relationship
with the Company.
7. Final Payment. The amounts owed to Employee set forth in paragraph
2 hereof are in full payment and satisfaction of any and all
claims Employee may have as of the date hereof, arising from,
related to, or in connection with Employee's employment with the
Company, including, but not limited to, all claims for breach of
contract, fraud, wrongful discharge, misrepresentation,
defamation, violation of public policy, breach of the implied
covenant of good faith and fair dealing, personal injury,
emotional distress, sexual harassment, and age, race, sex or other
prohibited discrimination; all liabilities for the payment of any
sums for accrued earnings, bonuses, stock options or other stock
rights, severance pay, sick leave or holiday plans, and any
employee benefits..
8. Return of Company Property. Employee represents and warrants that
the Employee has returned to Company all Company's property,
books, lists, records, other documents and equipment. Employee
covenants that should any such property be later discovered in his
possession or any additional items of Company's property, Employee
agrees to promptly return such property to the Company. Employee
acknowledges that he has received any personal property belonging
to him that was on Company's premises at the time of his
resignation.
9. Release Employee to Company.
a. Except as expressly provided herein, Employee, for himself, his
successors, administrators, heirs, and assigns, hereby fully
releases, waives and forever discharges Company, any affiliated
companies or subsidiaries, alter egos, their predecessors,
successors, affiliates, assigns, shareholders, directors,
officers, agents, attorneys and employees, whether past, present
or future (the "Company Released Parties") from any all actions,
suits, debts, demands, damages, claims judgments or liabilities
of any nature, arising on or before of the date hereof, including
costs and attorneys' fees, whether known or unknown, including,
but not limited to, all claims arising out of Employee's
employment with or separation from any of the Released Parties,
and all claims for breach of contract, wrongful discharge,
misrepresentation, defamation, violation of public policy, breach
of the implied covenant of good faith and fair dealing, personal
injury, emotional distress, sexual harassment, and age, race, sex
or other prohibited discrimination, and all liabilities for the
payment of any sums for accrued earnings, bonuses, stock options
or other rights, severance pay, sick leave or holiday plans, and
any other employee benefits, but excluding (i) any claim for
breach of this Agreement, (ii) any claim that Employee may make
under the Company's directors and officer's insurance policy now
or in the future or (iii) any claim for indemnification that
Employee may have under the by-laws of the Company.
b. Employee acknowledges and agrees that this release, are essential
and material terms of the Agreement and that, without such release
and covenant not to xxx; no agreement would have been reached by
the parties. Employee understands and acknowledges the
significance and consequences of this release and this Agreement.
c. To the maximum extent permitted by law, Employee covenants not to
xxx or to institute or cause to be instituted any action in any
federal, state or local agency or court against any of the Company
Released Parties with respect to any claim that is released in
this Section 8.
d. Employee agrees that Company has advised Employee to consult an
attorney prior to signing this Agreement and that he has done so.
10. Release Company to Employee.
a. Company, for itself and any affiliated companies or subsidiaries,
alter egos, their predecessors, successors, affiliates, assigns,
shareholders, directors, officers, agents, attorneys and
employees, whether past, present or future, hereby fully
releases, waives and forever discharges Employee, his successors,
administrators, heirs, executors and assigns (the "Employee
Released Parties") from any all actions, suits, debts, demands,
damages, claims judgments or liabilities of any nature, arising
on or before the date hereof, including costs and attorneys'
fees, whether known or unknown, including, but not limited to,
all claims arising out of Employee's employment with or
separation from the Company, and all claims for breach of
contract, but excluding any claim for breach of this Agreement
and the surviving provisions of the Employment Agreement arising
on or after the date of this Agreement.
b. Company acknowledges and agrees that this release is an essential
and material term of the Agreement and that, without such release
and covenant not to xxx; no agreement would have been reached by
the parties.
c. To the maximum extent permitted by law, the Company covenants not
to xxx or to institute or cause to be instituted any action in any
federal, state or local agency or court against any of the
Employee Released Parties with respect to any claim that is
released in this Section 9.
11. ADEA Release. Employee specifically waives and releases Company from
all claims he may have as of the date he signs this Agreement
regarding claims or rights arising under the Age Discrimination in
Employment Act of 1967, as amended, 29 U.S.C. ss. 621 ("ADEA"). This
paragraph does not waive rights or claims that may arise under the
ADEA after the date Employee signs this Agreement. Employee agrees
that this Agreement may provide benefits to which he is not otherwise
entitled and that Company has advised Employee to consult an attorney
prior to signing this Agreement.
12. The Older Workers Benefit Protection Act and the Right to Consider
and Revoke.
A. Employee has up to twenty-one (21) days from the date of
receipt of this Agreement to accept its terms. Employee
acknowledges and agrees that he has had the opportunity to
consult with his attorney about the Agreement prior to any
decision on his part to execute this Agreement.
B. Employee is advised, pursuant to the Older Workers Benefit
Protection Act ("OWBPA"), that by signing this Agreement he is
specifically waiving any claims he might have which have accrued
prior to the execution date of the Agreement under the Age
Discrimination in Employment Act of 1967 ("ADEA"). Employee
acknowledges, represents and agrees that this Agreement shall
result in a waiver and release of any rights Employee has under
the Age Discrimination in Employment Act of 1967 ("ADEA"), and
acknowledges, represents and agrees that he understands his
rights under the OWBPA, including but not limited to, his right
to consider this Agreement for a period of twenty-one (21) days
after his receipt of the Agreement.
C. Employee, by releasing any such claims under the ADEA, in
addition to the other claims set forth in this Agreement,
acknowledges that he so releases and waives these claims in
exchange for the valuable consideration referred to in Paragraph
2 above.
D. After the date of execution, Employee has an additional seven
(7) days in which to revoke his acceptance. The Agreement shall
not become effective or enforceable against Company until it has
been fully executed by Employee and returned to Company at the
following:
ICOA, Inc.
000 Xxxxxxx Xx.
Xxxxxxx, XX 00000
Furthermore, the Agreement shall not become effective or
enforceable against Company unless it remains unrevoked by
Employee within the additional seven (7) day revocation period.
To revoke, Employee must deliver to Company at the address set
forth in above, a written statement of revocation prior to 5:00
p.m. on the seventh day following his execution of this
Agreement.
E. If Employee does not revoke the Agreement, the eighth day
after the date of Employee's acceptance will be the Effective
Date of the Agreement. If Employee revokes his acceptance of this
Agreement within the seven day period specified above, Employee
shall receive none of the benefits of this Agreement, including
the payment described above. Employee further acknowledges,
represents and agrees that if he executes the Agreement prior to
the expiration of the twenty-one (21) day period, the decision to
do so was his and his alone, and that as a result, he has
voluntarily waived the twenty-one (21) day review period.
13. Governing Law. It is intended that the provisions of this Agreement
shall be enforced to the fullest extent permissible under the laws and
public policies applied in each jurisdiction in which enforcement is
sought. The provisions of this Agreement shall be construed in
accordance with the internal laws of the State of Rhode Island. In the
event that any paragraph, subparagraph or provision of this Agreement
shall be determined to be partially contrary to governing law or
otherwise unenforceable, the paragraph, subparagraph, or provision and
this Agreement shall be enforced to the maximum extent permitted by
law, and if any paragraph, subparagraph or provision of this Agreement
shall be determined to be totally contrary to governing law or
otherwise totally unenforceable, the paragraph, subparagraph, or
provision shall be severed and disregarded and the remainder of this
Agreement shall be enforced to the maximum extent permitted by law.
14. No Disclosure. The parties agree that (except in connection with
required public disclosure, in connection with tax reporting, or
pursuant to legal process in any legal action to enforce the terms of
this Agreement) they, their agents, and their family members,
directors, officers, and other Released Parties shall keep
confidential the terms of this Agreement. Employee and the Company
further agree not to disparage the other in the future
15. Confidential Information. a. Employee understands and agrees that in
the course of his employment with Company, he has acquired
confidential information and trade secrets concerning the operations
of Company, Company's owners, subsidiaries and affiliates
(collectively the "Companies"), including, but not limited to,
information relating to the organization, employment policies,
compensation and benefit plans, and personnel and any data, formulae,
specifications, proprietary knowledge or information, customer list,
marketing strategies, pricing and credit policies, trade secrets,
inventions or processes, owned, developed or used in the course of
Company's business (collectively "Confidential Information"). Employee
covenants and agrees that, for a period of one year from the date
hereof, he will not disclose any Confidential Information that is not
available to the general public. Further the obligation of
confidentiality shall not apply in the event employee is required by
law or subpoena to make disclosure. Confidential Information shall not
include information that has been independently developed and
disclosed by persons owing no duty of confidentiality or nondisclosure
to the Company.
b. Employee's obligations under this section 12 with respect to any
portion of Confidential Information shall not apply to such portion
that Employee can demonstrate that: (a) was known to Employee at the
time of disclosure, (b) was publicly known at or subsequent to the
time such portion was communicated to Employee by Company through no
fault of Employee; (c) was in Employee's possession free of any
obligation of confidence at or subsequent to the time such portion was
communicated to Employee by Company; (d) was developed by Employee
independently of and without reference to any of the Confidential
Information communicated to Employee by Company; (e) was required to
be disclosed in response to a valid order by a court or other
governmental body or to establish the rights of either party under
this Agreement, or (f) was approved for release by written
authorization of Company.
16 Default. The occurrence if any of the following shall be an "Event of
Default" hereunder:
a. The Company fails to make, within ten (10) days when due, any
payment required by this Agreement.
b. The Company fails to deliver the payment schedules to Employee as
required by Section 3 of this Agreement.
c. The Company's cessation of business or operations.
d. The insolvency or the filing of a petition in bankruptcy by or
against the Company or the Company shall have made an assignment for
the benefit of creditors, or there shall have been appointed a trustee
or receiver for all or a substantial part of the Company's property or
assets, or any other relief under any bankruptcy, insolvency,
reorganization, or other similar act or law of any jurisdiction now or
hereafter in effect.
e. Company's breach of any of its obligations hereunder or of the
representations, warranties and covenants contained herein.
17. Remedies. a. Upon the occurrence of an Event of Default, Employee
shall give written notice of the Event of Default to Company and
Employee may (i) declare all sums then remaining to be paid hereunder
to be immediately due and payable, (ii) exercise any of the other
remedies provided under this Agreement or otherwise available at law
or in equity.
b. Company shall be liable for all costs, charges and expenses,
including reasonable attorney's fees and disbursements, incurred by
Employee by reason of the occurrence of an event of default or the
exercise of Employee's remedies with respect thereto.
18. Entire Agreement. Employee agrees that this Agreement, including the
Exhibits thereto if any, along with the Indemnification Agreement,
constitutes the entire understanding between the parties with
reference to the subject matter of this Agreement, including
employment, independent contractor status, all loans, advances,
investments made by Employee, all promises and representations made by
Company or its officers, directors or employees, and all prior
negotiations and understandings, verbal or written, between Employee
and Company, relating to the items and things referred to in this
Agreement have been merged herein. Subject to the limitations set
forth in Section 5, that certain agreement captioned ICOA Employment
Agreement dated October 25, 2005 between Company and employee is
hereby terminated and declared null and void and no provisions thereof
shall remain in effect (including without limitation any provision
that states same shall survive the termination if such agreement), all
such provisions having been superseded by this document. Subject to
the limitations set forth in Section 5, the Xxxxxxxx Employment
Agreement is hereby terminated and all provisions thereof are
superseded by this Agreement, including without limitation the
confidentiality provisions and conflict of interest provisions and any
restrictions contained therein shall not be binding on employee and
employee is hereby released from such restrictions.
19. Arbitration. Any and all disputes arising out of or in any way related
to Employee's employment with, or separation from, Company, as well as
any and all disputes or claims arising out of or in any way related to
this Agreement, including, without limitations, fraud in the
inducement of this Agreement, or relating to the general validity or
enforceability of this Agreement, shall be submitted to arbitration
before an arbitrator of the American Arbitration Association,
Providence, Rhode Island, in accordance with the rules of that body
governing commercial disputes, and prevailing party shall be entitled
to reasonable costs and attorneys' fees. Notwithstanding the
foregoing, Employee shall not be required to enforce Employee's
payment rights under Section 2 of this Agreement in an arbitration
proceeding under this Section 16 and may pursue any other remedy
available to him.
20. No Waiver. No express or implied waiver by Employee of any default
hereunder shall in any way be, or be construed to be, a waiver of any
future or subsequent default. The failure or delay of Employee in
exercising any rights granted it hereunder shall not constitute a
waiver of any such right upon the continuation or reoccurrence of any
such event and any single or partial exercise of any particular right
by Employee shall not exhaust the same or constitute a waiver of any
other right provided herein.
21. Termination; Survival. The parties obligations under Sections 2, 3, 4,
5, 8, 9, 11 and 12 shall survive termination of this Agreement.
22. Inspection of Records. Employee shall be permitted once per fiscal
quarter, at its cost (unless such inspection is due to lack of payment
being made as required of Company hereunder in which case the costs
shall be borne by Company), to examine the books and records of
Company and any related party at any time during business hours and
upon reasonable notice.
23. Miscellaneous. The parties hereto agree that if any covenant,
paragraph or clause contained in this Agreement, is declared illegal,
null or void, or against public policy, for any reason, the remaining
covenants, paragraphs or clauses contained in this Agreement shall not
be affected thereby.
24. Definition of Company. Each reference to the Company herein shall
include all subsidiaries and affiliates of the Company.
25. Corporate Officers. The parties signing below on behalf of the Company
represent that they have the power and authority to sign this
Agreement and to bind the Company and that by such signature this
Agreement shall become the valid and binding agreement of the Company
enforceable in accordance with its terms.
IN WITNESS WHEREOF, the parties have executed this Agreement and have had their
authorized officers execute this agreement in Warwick, Rhode Island this 30 day
of June, 2006.
ICOA, Inc.
By
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Its
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Accepted and Agreed to:
By
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Xxxxxxx X. Xxxxxxxx
