EXHIBIT 10.37
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SEPARATION AGREEMENT AND GENERAL RELEASE
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Separation Agreement and General Release ("Agreement") executed this 13 day
of September 1999, by and between Xxxxxxx Xxxxxxxx, Ph.D. ("Xx. Xxxxxxxx" or
"Releasor") and V.I. Technologies, Inc. ("VITEX" or "the Company").
WHEREAS, Xx. Xxxxxxxx and VITEX entered into an Employment Agreement dated
January 15, 1998 (the "Employment Agreement") a copy of which is annexed hereto
as Exhibit "B"; and
WHEREAS, Xx. Xxxxxxxx has expressed his intention to voluntarily terminate
his employment pursuant to the provisions of (P)4.3 of the Employment Agreement;
NOW, THEREFORE, for good and valuable consideration, the sufficiency of
which is hereby acknow1edged it is hereby agreed that:
1. XX. XXXXXXXX'X RESIGNATION
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(a) Xx. Xxxxxxxx hereby irrevocably gives notice of his intention to resign
from his employment at VITEX, effective October 1, 1999, and VITEX accepts that
resignation. Xx. Xxxxxxxx and VITEX expressly acknowledge that this Agreement
supercedes and replaces the Employment Agreement and except as otherwise
provided herein, effective October 1, 1999, the Employment Agreement, and all
terms, conditions, and obligations set forth therein, will expire and will be
declared null and void.
2. THE SEVERANCE PAYMENT, VESTING OF STOCK OPTIONS, AND LIFE INSURANCE
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(a) As used herein, the term "Severance Period" refers to the one year
period beginning on October 1, 1999 and ending on September 30, 2000.
(b) Subject to Xx. Xxxxxxxx'x execution of this Agreement, VITEX shall pay
Xx. Xxxxxxxx severance equivalent to one year's salary at his current rate of
pay, a total of $198,919.00 (the "Severance Payment"), less applicable
withholding taxes and deductions. The Severance Payment will be made in two (2)
equal installments, paid six months apart less applicable withholding taxes and
deductions. The first such payment will be made on or before October 20, 1999.
(i) Xx. Xxxxxxxx expressly acknowledges that he will not be entitled
to any annual bonus payment pursuant to (P)3.2 of the Employment
Agreement.
(c) Subject to the approval of the Compensation Committee of the Board of
Directors of VITEX, (i) the stock options granted to Xxxxxxxx in 1995 and 1997
to purchase 223,614
shares (at $2.795 per share) and 125,224 shares (at $8.39 per share)
respectively, of VITEX common stock, $.01 par value per share under the Equity
Incentive Plan (the "Stock Options"), shall fully vest, to the extent they have
not previously vested, on October 1, 1999, and (ii) Xxxxxxxx shall be permitted
to exercise the Stock Options at any time prior to the tenth anniversary of the
date of grant of such options, in accordance with the terms of the Equity
Incentive Plan and the stock option agreements executed thereunder (as modified
by this Agreement).
(d) Xx. Xxxxxxxx'x participation in VITEX's medical and dental benefit
plans will continue for the duration of the Severance Period, and will terminate
on September 30, 2000, at which time, and on an annual basis thereafter for as
long as he is alive, he will be offered the opportunity to enroll in any major
medical and dental insurance plans VITEX provides to its full time, senior
management staff. If he chooses to enroll in such plans, the cost to Xx.
Xxxxxxxx will be as though he were still actively employed by VITEX.
(e) The life insurance referenced in (P)3.8 of the Employment Agreement
will remain in force (to the extent the policy is payable to Xx. Xxxxxxxx'x
family), at VITEX's cost, until the end of the Severance Period (September 30,
2000).
(f) Except as provided herein, Xx. Xxxxxxxx'x participation in all other
benefit plans will cease on October 1, 1999.
3. CONTINUED MEMBERSHIP ON VITEX'S BOARD OF DIRECTORS
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(a) Xx. Xxxxxxxx will remain a member of VITEX's Board of Directors after
October 1, 1999. Xx. Xxxxxxxx expressly acknowledges that he has been given no
guarantees with respect to his continued membership on the Board of Directors.
Xx. Xxxxxxxx agrees that if the Board of Directors requests his resignation from
the Board of Directors for any reason, he will immediately tender his
resignation as a Director of VITEX. After the expiration of the Severance
Period, if Xx. Xxxxxxxx remains a member of the Board of Directors, he will be
entitled to receive the same benefits received by other members of the Board of
Directors.
4. CONSULTING SERVICES
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(a) Although under no obligation to do so, Xx. Xxxxxxxx may perform
consulting services to VITEX. Any such consulting services will be performed
upon reasonable notice, at mutually agreeable times and locations. Xx. Xxxxxxxx
agrees that during the Severance Period he will not seek, nor is he entitled to,
any additional compensation for any such consulting services, unless he has
provided more than 800 hours of services during the Severance Period. Xx.
Xxxxxxxx will be compensated for each hour of consulting services provided
during the Severance Period in excess of 800 hours at the rate of $200.00 per
hour.
(b) After the expiration of the Severance Period, and beginning on October
1, 2000, Xx. Xxxxxxxx will begin receiving quarterly retainer payments of
$25,000.00 as compensation for consulting services to be provided during the
following calendar quarter (e.g. the October 1,
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2000 payment will cover services rendered during the fourth quarter of 2000).
Such payments will be made on the first day of each quarter during which the
contemplated services are to be provided. These quarterly retainer payments will
continue until such time as this consulting arrangement is terminated by VITEX
or Xx. Xxxxxxxx in the manner described below. The $25,000.00 retainer will
constitute full compensation for up to 200 hours of consulting services provided
during the quarter. Xx. Xxxxxxxx will be compensated for each hour of consulting
services in excess of 200 hours during a calendar quarter at the rate of $200.00
per hour.
(i) The consulting arrangement described in this sub paragraph "4(b)"
can be terminated by either Xx. Xxxxxxxx or VITEX, at any time,
with 90 days notice.
5. CONSIDERATION AND FULL DISCHARGE
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(a) Xx. Xxxxxxxx agrees that the aggregate consideration provided in this
Agreement:
(i) exceeds any payment, benefit, or other thing of value to which he
might otherwise be entitled under any policy, plan or procedure
of VITEX, and
(ii) is in full discharge of any and all of VITEX's liabilities and
obligations to him, whether written or oral, including, without
limitation, any bonus, deferred bonus, accrued vacation pay,
severance payment or any other contractual or other obligation,
compensation or remuneration that may be owed to Xx. Xxxxxxxx by
VITEX.
6. GENERAL RELEASE
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(a) For good and valuable consideration, the receipt of which is hereby
acknowledged, Xx. Xxxxxxxx for himself and for his heirs, executors,
administrators, trustees, legal representatives and assigns (hereinafter,
collectively referred to as "Releasors"), hereby forever release and discharge
VITEX, or any of VITEX's past, present or future parent entities, partners,
subsidiaries, affiliates, divisions, employee benefit and/or pension plans or
funds, successors and assigns and any of its or their past, present or future
directors, officers, attorneys, agents, trustees, administrators, employees, or
assigns (whether acting as agents for VITEX or in their individual capacities)
(collectively referred to as "Releasees") from any and all claims, demands,
causes of action, and liabilities of any kind whatsoever (upon any legal or
equitable theory, whether contractual, common-law, statutory, federal, state,
local, or otherwise), whether known or unknown, by reason of any act, omission,
transaction or occurrence which Releasors ever had, now have or hereafter can,
shall or may have against Releasees up to and including the Agreement Effective
Date, as defined in Paragraph 10(c) below.
Without limiting the generality of the foregoing, Releasors hereby release
and discharge Releasees from:
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(i) any and all claims relating to Xx. Xxxxxxxx'x employment by
VITEX, the terms and conditions of such employment, the
employee benefits related to his employment and/or his
separation from such employment;
(ii) any and all claims of employment discrimination and/or
retaliation under any federal, state or local statute or
ordinance, including without limitation, any and all claims
under Title VII of the Civil Rights Act of 1964 as amended; the
Age Discrimination in Employment Act, the Older Workers Benefit
Protection Act, the Americans with Disabilities Act; the Family
and Medical Leave Act of 1993; the Employee Retirement Income
Security Act; the New York State Human Rights Law; and the New
York City Human Rights Law;
(iii) any and all claims for wrongful discharge and for breach of
employment contract (including, but not limited to the
Employment Agreement) or any claims related to compensation or
benefits, including claims for bonus or deferred payments;
(iv) any and all claims for defamation, libel or slander against any
Releasees; and
(v) any and all claims for attorney's fees, costs disbursements and
the like;
which Releasors ever had, now have or hereafter can, shall or may have against
Releasees for, upon or by reason of any act, omission, transaction or occurrence
up to and including the date of the execution of this Agreement.
(b) Xx. Xxxxxxxx agrees, unless such agreement is otherwise prohibited by
law, that he will not commence, maintain, prosecute or participate (except as
compelled by legal process) in any action or proceeding of any kind (judicial or
administrative) against Releasees, arising out of any act, omission, transaction
or occurrence occurring up to and including the Agreement Effective Date, as
defined in paragraph 10(c) below.
(c) Xx. Xxxxxxxx further agrees, unless such agreement is otherwise
prohibited by law, that he will not seek or accept any award or settlement from
any source or proceeding with respect to any claim or right covered by
paragraphs "6(a) and (b)" and that this Agreement shall act as a bar to recovery
in any such proceedings.
7. CONFIDENTIALITY
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(a) Xx. Xxxxxxxx acknowledges that this Agreement and all terms and
conditions thereof shall be kept strictly confidential and shall not be
disclosed by Xx. Xxxxxxxx to anyone, except to the extent required by law;
except that Xx. Xxxxxxxx may disclose the terms of this Agreement to his spouse,
accountant, attorney and/or his financial advisor, who shall be instructed that
the Agreement and its terms are to be kept confidential. In the event of any
breach
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of this provision, Xx. Xxxxxxxx consents to the entry of injunctive relief in
the United States District Court for the Southern District of New York, and
further, inasmuch as the damages from any material breach of this
confidentiality provision cannot be ascertained, Xx. Xxxxxxxx agrees that a
material breach of this provision by Xx. Xxxxxxxx shall result in the payment by
Xx. Xxxxxxxx to VITEX of liquidated damages in the amount of $198,919.00.
Notwithstanding the foregoing, this paragraph shall not apply to Xx. Xxxxxxxx if
he is acting in his capacity as director of VITEX.
(b) VITEX acknowledges that this Agreement and all terms and conditions
thereof shall be kept strictly confidential and shall not be disclosed by any
officer or director of VITEX to anyone, except to the extent required by law and
to those persons whose efforts are required to effectuate the terms of this
Agreement; except that VITEX, through its officers, may disclose the terms of
this Agreement to VITEX's attorneys and/or accountants, who shall be instructed
that the Agreement and its terms are to be kept confidential.
(c) The parties agree that this Agreement and the attached General Release
may be used as evidence only in a subsequent proceeding in which any of the
parties allege a breach of this Agreement or the attached General Release.
8. NON-DISPARAGEMENT
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(a) Xx. Xxxxxxxx agrees that he will not disparage (or induce or encourage
others to disparage) VITEX, any of its past or present directors, officers,
agents, trustees, administrators, attorneys or employees with respect to any
events relating to his employment with VITEX, including, without limitation,
disparaging any of such parties in connection with disclosing the facts or
circumstances surrounding his separation from employment with VITEX or
criticizing VITEX's business strategy. For the purposes of this Agreement, the
term "disparage" means any comments or statements which would adversely affect
in any manner: (i) the conduct of VITEX's business; or (ii) the business
reputation or relationships of VITEX and/or any of its past or present
directors, officers, agents, trustees, administrators, attorneys or employees.
Notwithstanding the foregoing, this paragraph shall not apply to Xx. Xxxxxxxx if
he is acting in his capacity as a director of VITEX.
(b) VITEX agrees not to disparage Xx. Xxxxxxxx. For purposes of this
subparagraph, the term "disparage" means any statements made by VITEX senior
officers or directors, or any statements made officially by VITEX that adversely
affect Xx. Xxxxxxxx'x personal or professional reputation.
9. COMPANY DOCUMENTS AND PROPERTY
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(a) Xx. Xxxxxxxx agrees not to copy or take any books, notes or documents
belonging to VITEX without its express written consent. In this regard, Xx.
Xxxxxxxx acknowledges that he has had access to confidential, sensitive or
proprietary information during the course of his employment at VITEX. Unless
compelled by judicial process, Xx. Xxxxxxxx agrees that he will not, for herself
or any other person or entity, directly or indirectly divulge, communicate or in
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any way make use of any confidential, sensitive, or proprietary information
acquired in the performance of his services or in connection with the
performance of such services for VITEX without the prior written consent of
VITEX. Upon receipt of judicial process or governmental request for such
information, Xx. Xxxxxxxx shall immediately notify VITEX and shall cooperate
with VITEX in efforts to limit such disclosure and shall not make such
disclosure unless compelled to do so. For the purpose of this Agreement, all
information acquired during the course of Xx. Xxxxxxxx'x employment and in
connection with such employment shall be deemed to be confidential, sensitive or
proprietary, unless VITEX shall have published said information.
Notwithstanding the foregoing, it is understood that (i) Xx. Xxxxxxxx brought
certain materials with him when he joined VITEX and that such materials do not
belong to VITEX, (ii) Xx. Xxxxxxxx may retain published scientific works and
slides which he collected while an employee of VITEX.
(b) If Xx. Xxxxxxxx has not already done so, he shall immediately return
to VITEX all Company property in his possession (with the exception of a
computer which VITEX has permitted Xx. Xxxxxxxx to retain) including, but not
limited to credit cards, building passes, airline tickets, facsimile machines,
paging devices and portable telephones.
(c) If Xx. Xxxxxxxx has not already done so, he shall immediately deliver
to VITEX all correspondence, documents, papers and other media containing
information about the accounts, clients, interests, or business of VITEX
together with all copies in his possession.
10. REVIEW AND REVOCATION PERIODS
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(a) Xx. Xxxxxxxx shall have at least twenty-one (21) days from the date of
receipt, or until September 30, 1999, to consider the terms and conditions of
this Agreement. Xx. Xxxxxxxx may accept this Agreement by signing it, having
his signature notarized and returning it to Xxxxx Xxxxxxxx, VITEX, Inc., 000
Xxxxxx Xxxx, Xxxxxxxx, XX 00000, by no later than 5:00 p.m. on September ____,
1999. Further, Xx. Xxxxxxxx may sign and return this Release at any time prior
to September 30, 1999.
(b) After signing this Release, Xx. Xxxxxxxx shall have seven (7) days to
revoke this Agreement by indicating his desire to do so in writing (a) addressed
to Xxxxx Xxxxxxxx, at the address listed above, and (b) received by Xx. Xxxxxxxx
no later than 5:00 p.m. on the seventh (7th) day following the date Xx. Xxxxxxxx
signs this Agreement.
(c) The effective date of this Agreement shall be the eighth (8th) day
following Xx. Xxxxxxxx'x signing of this Agreement (the "Agreement Effective
Date"), provided Xx. Xxxxxxxx does not revoke this Agreement during the
revocation period. In the event Xx. Xxxxxxxx does not accept this Agreement as
set forth above, or revokes this Agreement during the Revocation Period, this
Agreement including but not limited to the obligation of the Releasees to
provide the payments, and provide the benefits, referred to in paragraph "2" and
"3" above, shall automatically be deemed null and void.
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11. Xx. Xxxxxxxx acknowledges that: (a) he has carefully read this
Agreement in its entirety; (b) he has had an opportunity to consider fully the
terms of this Agreement for at least twenty-one (21) days; (c) he has been
advised by VITEX in writing to consult with an attorney of his choosing in
connection with this Agreement; (d) he fully understands the significance of all
of the terms and conditions of this Agreement; (e) he has discussed it with his
independent legal counsel, or has had a reasonable opportunity to do so; (f) he
has had answered to his satisfaction any questions he has asked with regard to
the meaning and significance of any of the provisions of this Agreement; (g) he
is signing this Agreement voluntarily and of his own free will and assents to
all the terms and conditions contained herein; (h) the amounts being paid
hereunder are in excess of those amounts he would be entitled to if he did not
sign this Agreement and (i) that as of December 23, 1999 his employment
relationship with VITEX will be permanently and irrevocably severed and that to
the full extent permitted by law he will not be eligible for rehire or re-
employment with any of the Releasees, that he will not apply for re-employment
with any of the Releasees and that the Releasees have no obligation, now or at
any time in the future, to rehire or re-employ him in any capacity, that any
future decision by any of the Releasees not to hire him will be based upon this
subparagraph and that he will not assert any claims against any Releasees based
upon such decision.
ADDITIONAL PROVISIONS
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12. The making of this Agreement is not intended, and shall not be
construed, as an admission that Releasees have violated any federal, state or
local law (statutory or decisional), ordinance or regulation, breached any
contract, or committed any wrong whatsoever against Xx. Xxxxxxxx.
13. This Agreement is binding upon, and shall inure to the benefit of, the
parties and their respective heirs, executors, administrators, successors and
assigns.
14. This Agreement shall be interpreted, construed and governed according
to the laws of the State of New York.
15. If any provision of this Agreement shall be held by a court of
competent jurisdiction to be illegal, void, or unenforceable, such provision
shall be of no force and effect. However, the illegality or unenforceability of
such provision shall have no effect upon, and shall not impair the
enforceability of, any other provision of this Agreement; provided, however,
that, upon any finding by a court of competent jurisdiction that the release and
covenants provided for by paragraphs "5" and "6" of this Agreement are illegal,
void, or unenforceable, Xx. Xxxxxxxx agrees, at the Releasees option, either to
return promptly to VITEX the amounts paid to his or paid on his behalf pursuant
to this Agreement or to execute a release, waiver and/or covenant that is legal
and enforceable. Further, if Xx. Xxxxxxxx seeks to challenge the validity of or
otherwise vitiate this Agreement or any provision thereof (including, without
limitation, paragraphs "5" and "6"), Xx. Xxxxxxxx shall, as a precondition, be
required to repay to VITEX the amounts paid to him or paid on his behalf
pursuant to the terms of this Agreement. Finally, any breach of the terms of
paragraphs "5," "6," "7," "8," and/or "9" shall constitute a material breach of
this Agreement as to which the Releasees may seek appropriate relief (including
but not limited to
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repayment of the amounts paid to him or paid on his behalf referred to this
Agreement) in a court of competent jurisdiction.
17. The paragraph and section headings contained herein are for reference
purposes only and shall not in any way affect the meaning or interpretation of
this Agreement.
18. This Agreement (together with the accompanying cover letter)
constitutes the complete understanding between the parties and supersedes any
and all Releases, understandings, and discussions, whether written or oral,
between the parties. No other promises or agreements shall be binding unless in
writing and signed alter the Agreement Effective Date by the parties to be bound
thereby.
WHEREFORE, Xx. Xxxxxxxx places his hand on the dates hereinafter set forth.
Xxxxxxx Xxxxxxxx, Ph.D.
/s/ Xxxxxxx Xxxxxxxx Date 9-13-99
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On this 13/th/ day of September, 1999, before me personally appeared Xxxxxxx
Xxxxxxxx, Ph.D., to me known personally and known to me to be the individual
described herein, whose name is subscribed to, and who executed the above
Agreement and General Release.
/s/ Xxxxxx Xxxxxxx
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Notary Public
Agreed:
V.I. Technologies, Inc.
By: /s/ Xxxx Xxxx
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Xxxx Xxxx
President and Chief Executive Officer
