SEPARATION AGREEMENT AND GENERAL RELEASE
Return
to 10Q
Exhibit
10.2
SEPARATION
AGREEMENT AND GENERAL RELEASE
This
Separation Agreement and General Release (this “Agreement”) is made and entered
into by and between Xxxxx X. Xxxxx and I.C. Xxxxxx & Co., Inc.
DEFINITIONS
As
used
throughout this Agreement:
1. “Xxxxx”
refers to Xxxxx X. Xxxxx, his heirs, executors, administrators, agents,
successors, assigns and dependents.
2. “Xxxxxx”
refers to I.C. Xxxxxx & Co., Inc., together with its respective past and
present parents, subsidiaries, and affiliates, and its respective past and
present officers, directors, agents, employees, successors and assigns, in
both
their individual and corporate capacities.
RECITALS
WHEREAS,
Xxxxx had been employed as Chief Executive Officer of Xxxxxx and had been
Chairman of the Board of Directors for Xxxxxx;
WHEREAS,
pursuant to this Agreement, Xxxxx has resigned as Chief Executive Officer and
Chairman of the Board of Xxxxxx, effective as of April 5, 2007 (the “Termination
Date”); and
WHEREAS,
the parties hereto desire to settle any and all potential disputes relating
to
Xxxxx’x employment and the termination thereof;
NOW,
THEREFORE, in consideration of the mutual covenants and agreements hereinafter
set forth, and intending to be and being legally bound hereby, the parties
agree
as follows:
AGREEMENT
1. Effective
immediately, Xxxxx hereby: (a) resigns his employment with Xxxxxx as Chief
Executive Officer, (b) resigns his position as Chairman of the Board of Xxxxxx,
(c)\ resigns his position as a Director on the Board of Directors of
Xxxxxx, and (d) resigns any and all positions he has, whether as a director,
officer, or otherwise, with any affiliate of Xxxxxx or otherwise by reason
of
his employment with Xxxxxx. Xxxxxx hereby accepts such
resignations.
2. Xxxxx
represents that he does not have any claim, action or proceeding pending against
Xxxxxx, or which arises out of his employment by Xxxxxx or the termination
thereof.
3. In
full
and complete consideration for Xxxxx’x promises, covenants and agreements set
forth herein, Xxxxxx will continue to pay Xxxxx’x base salary at the rate of
$550,000 per annum (“Base Salary”) through the date that is one year following
the Termination Date in accordance with Xxxxxx’ normal payroll practices. In
addition, Xxxxxx will pay Xxxxx a pro rata portion of his 2007 bonus for work
performed in his capacity as Chief Executive Officer in the amount of $45,547.75
(“2007 Bonus”). In addition, if Xxxxx timely elects to continue medical and/or
dental insurance coverage pursuant to COBRA, Xxxxxx shall provide such coverage
without charge to Xxxxx from the Termination Date through the date that is
one
year following the Termination Date (the “Benefit Period”); thereafter, Xxxxx
shall be responsible for paying the required COBRA premium for the remainder
of
the term of his continuation coverage. During the Benefit Period, Xxxxx will
continue to participate in all of Xxxxxx’ benefit plans not covered by COBRA in
which he participated immediately prior to the Termination Date so long as
such
coverage is available under such applicable plans in accordance with applicable
law. In the event that any insurance coverage previously offered is not
available under such applicable plans, Xxxxxx will use reasonable efforts to
convert any such insurance coverage into individual coverage for Xxxxx and
pay
the premium associated with such coverage for the Benefit Period, provided
that
such coverage costs Xxxxxx no more than the cost per annum to Xxxxxx prior
to
the Termination Date. In the event that any such insurance coverage is not
converted into individual coverage for Xxxxx, Xxxxxx shall pay Xxxxx an amount
equal to the cost per annum to Xxxxxx of such coverage prior to the Termination
Date. Xxxxx’x stock options will fully vest upon termination of employment.
Thereafter, Xxxxx will have one year from the Termination Date to exercise
his
options. All payments to Xxxxx pursuant to this Agreement will be less all
applicable deductions and withholdings. Subject to the provisions of Section
17
below, no payments shall be made for the six-month period following the
Termination Date and an amount equal to six months of the Base Salary shall
be
paid in a lump sum on the date that is six months following the Termination
Date. The 2007 Bonus will be paid in April 2008.
4. (i)
Xxxxx
shall not be entitled to any payment or continued payment or benefits under
Section 3 of this Agreement if Xxxxx is in willful material breach of any
covenant contained in this Agreement, and such breach, if susceptible to cure,
is not substantially cured within 15 days after written notice of such breach
is
delivered to Xxxxx.
(ii)
Xxxxx shall not be entitled to any payment or continued payment or benefits
under Section 3 of this Agreement in the event a court of competent jurisdiction
renders a preliminary or final determination that any covenant in this Agreement
is unenforceable or invalid in its entirety, provided that Xxxxx contended
in
the proceeding resulting in such determination that this Agreement was invalid
or unenforceable in whole or in part.
5.
(i)Xxxxx
acknowledges that during the course of his past employment with Xxxxxx and
pursuant to Section 10 of this Agreement, he has had, and will continue to
have,
access to proprietary information and confidential records of Xxxxxx, and has
made, and will continue to make, use of proprietary information and confidential
records of Xxxxxx. Xxxxx agrees that he shall not, directly or indirectly,
hereafter use for his own purpose or for the benefit of any person or entity
other than Xxxxxx, nor otherwise disclose, any proprietary information to any
individual or entity, unless such disclosure has been authorized in writing
by
Xxxxxx or is otherwise required by law. Xxxxx acknowledges and understands
that
the term “proprietary information” includes, but is not limited to: (a) the
software products, programs, applications, and processes utilized by Xxxxxx;
(b) the name and/or address of any licensor, customer, vendor or
distributor of Xxxxxx or any information concerning the transactions or
relations of any licensor, customer, vendor or distributor of Xxxxxx or any
of
its or their partners, principals, directors, officers or agents; (c) any
information concerning any product, technology, or procedure employed by Xxxxxx
but not generally known to its or their customers, vendors or competitors,
or
under development by or being tested by Xxxxxx but not at the time offered
generally to customers, vendors or distributors; (d) any information concerning
the structure or content of the proprietary databases of any of Xxxxxx; (e)
any
information relating to the computer software, computer systems, pricing or
marketing methods, sales margins, cost of goods, cost of material, capital
structure, operating results, borrowing arrangements or business plans of any
of
Xxxxxx; (f) customer lists and contact information; (g) any information which
is
generally regarded as confidential or proprietary in any line of business
engaged in by Xxxxxx; (h) product information and future development plans;
(i)
any business plans, budgets, advertising or marketing plans; (j) any information
contained in any of the written or oral policies and procedures or manuals
of
Xxxxxx; (k) any information belonging to customers, vendors or distributors
of
Xxxxxx or any other person or entity which Xxxxxx has agreed to hold in
confidence; (l) any inventions, innovations or improvements covered by this
Agreement; and (m) all written, graphic and other material relating to any
of
the foregoing. Xxxxx acknowledges and understands that information that is
not
novel or copyrighted or patented may nonetheless be proprietary information.
The
term “proprietary information” shall not include information (i) generally
available to and known by or disclosed by Xxxxxx to the public or information
that is or becomes available to Xxxxx on a non-confidential basis from a source
other than Xxxxxx or its directors, officers, employees, partners, principals
or
agents (other than as a result of a breach of any obligation of confidentiality)
or (ii) that is within Xxxxx’x general business or industry knowledge,
know-how or expertise (collectively, “know-how”), provided such know-how is of a
generic nature not specifically pertaining to Xxxxxx.
(ii) Xxxxx
shall not at any time hereafter, except as required by law, directly or
indirectly publish, make known or in any fashion disclose any confidential
records to, or permit any inspection or copying of confidential records by,
any
individual or entity other than in the course of such individual’s or entity’s
employment or retention by Xxxxxx. Xxxxx shall deliver promptly to Xxxxxx all
property and records of Xxxxxx, including, without limitation, all confidential
records. For purposes hereof, “confidential records” means all correspondence,
reports, memoranda, files, manuals, books, lists, financial, operating or
marketing records, magnetic, optical, or electronic or other media or equipment
of any kind which may be in Xxxxx’x possession or under his control or
accessible to him which contain any proprietary information. Xxxxx agrees that
all property and records of Xxxxxx (including, without limitation, all
confidential records) shall be and remain the sole property of
Xxxxxx.
(iii) All
inventions, innovations or improvements (including policies, procedures,
products, improvements, software, ideas and discoveries, whether patent,
copyright, trademark, service xxxx, or otherwise) conceived or made by Xxxxx,
either alone or jointly with others, in the course of his employment with
Xxxxxx, belong to Xxxxxx. Xxxxx will promptly disclose in writing such
inventions, innovations or improvements to Xxxxxx and perform all actions
reasonably requested by Xxxxxx to establish and confirm such ownership by
Xxxxxx, including, but not limited to, cooperating with and assisting Xxxxxx
in
obtaining patents, copyrights, trademarks, or service marks for Xxxxxx in the
United States and in foreign countries.
(iv) Xxxxx
agrees that, for six (6) months following the Termination Date, Xxxxx shall
not,
directly or indirectly, without the express prior written authorization of
Xxxxxx, advise or encourage any person who is or was a licensor, customer,
vendor or supplier of or to Xxxxxx within the 12-month period immediately
preceding the Termination Date to terminate his, her or its relationship with
Xxxxxx or to reduce the amount of business customarily done with
Xxxxxx.
(v) Xxxxx
acknowledges and agrees that, by virtue of his position, his services, and
access to and use of confidential records and proprietary information, any
violation by him of any of the undertakings contained in this Section 5 would
cause Xxxxxx immediate, substantial and irreparable injury for which it has
no
adequate remedy at law. Xxxxx agrees and consents to the entry of an injunction
or other equitable relief by a court of competent jurisdiction restraining
any
violation or threatened violation of any undertaking contained in this Section
5. Xxxxx waives posting by Xxxxxx of any bond otherwise necessary to secure
such
injunction or other equitable relief. Rights and remedies provided for in this
Agreement are cumulative and shall be in addition to rights and remedies
otherwise available to Xxxxxx under any other agreement or applicable
law.
6. Except
as
necessary to enforce the terms of this Separation Agreement and General Release,
and in exchange for and in consideration of the promises, covenants and
agreements set forth herein, Xxxxx hereby releases Xxxxxx to the maximum extent
permitted by law from any and all manner of claims, demands, causes of action,
obligations, damages, or liabilities whatsoever of every kind and nature, at
law
or in equity, known or unknown, and whether or not discoverable, which he has
or
may have for any period prior to and arising up to his execution of this
Separation Agreement and General Release, including, but not limited to, any
claim of defamation, wrongful discharge, breach of contract, any claim for
additional compensation, any claims arising out of or related to Xxxxx’x
employment by Xxxxxx and the termination thereof, any claims arising under
or
related to any employment agreement, whether oral or written, between Xxxxx
and
Xxxxxx, claims for unpaid wages or commissions or bonuses, severance pay, and
claims of discrimination under the Age Discrimination in Employment Act of
1967,
as amended, the Americans with Disabilities Act, Title VII of the Civil Rights
Act of 1964, as amended, and all other federal, state and local laws, including
but not limited to any claim for attorneys’ fees or costs.
7. The
parties agree that it is a material condition of this Separation Agreement
and
General Release that, except as required by law, each party maintain strictly
confidential, and shall take all reasonable steps to prevent the disclosure
to
any person or entity, the existence and terms of this Separation Agreement
and
General Release and all disputes and disagreements between Xxxxx and Xxxxxx
arising out of Xxxxx’x employment by Xxxxxx and the termination thereof. This
provision does not prohibit either party from providing this information to
an
attorney or accountant for purposes of obtaining legal or tax advice, or, in
the
case of Xxxxx, to members of his immediate family. To the extent Xxxxx makes
any
disclosure to any attorney, accountant or family member as permitted pursuant
to
this Section, he shall instruct such person not to make any further disclosure
except in accordance with this Section and shall be responsible for such person
treating such information in the same manner as Xxxxx is required to treat
it
under this Agreement.
8. The
parties agree that it is a material condition of this Separation Agreement
and
General Release that Xxxxx shall not make or publish any statement (in verbal,
written, electronic or any other form), or instigate, assist or participate
in
the making or publication of any statement (in verbal, written, electronic
or
any other form), which would libel, slander or disparage (whether or not such
disparagement legally constitutes libel or slander) or expose to hatred,
contempt or ridicule (i) Xxxxxx; (ii) any of its products, services, affairs,
or
operations; or (iii) any of its past or present directors, officers,
employees, agents, or licensors. By way of example only, such prohibition shall
include,
but not be limited to, a negative or derogatory statement made in, or in
connection with, any article or book, on a website or via the
internet. Xxxxxx
agrees that it will not make any official or internal announcements or issue
any
press releases which contain any negative or derogatory statements about Xxxxx
and will advise the members of Xxxxxx’ Board of Directors that they should not
make any disparaging remarks, written or verbal, intended to adversely affect
or
having a foreseeable result of adversely affecting Xxxxx or his business, good
name or reputation.
9. Xxxxx
shall reasonably cooperate with Xxxxxx in connection with any and all actions,
governmental inquiries or other legal proceedings in which Xxxxx’x assistance
may be requested by Xxxxxx. Such cooperation shall include, among other things,
making documents relating to Xxxxxx in Xxxxx’x custody or control available to
Xxxxxx or its counsel, making Xxxxx reasonably available for interviews by
Xxxxxx or its counsel, and being reasonably available to appear as a witness
at
deposition, trial or otherwise. In addition, for a period of six (6) months
following the Termination Date, Xxxxx shall reasonably cooperate with Xxxxxx
(primarily through telephone conference), as requested by Xxxxxx, to effect
a
transition of his responsibilities and the ongoing conduct of Xxxxxx’ business,
and to ensure that Xxxxxx is aware of all matters being handled by him. Any
reasonable vouchered out-of-pocket expenses incurred by Xxxxx in fulfilling
his
obligations under this Section 9 shall be promptly reimbursed by
Xxxxxx.
10. Notwithstanding
anything to the contrary contained in this agreement, neither Xxxxx nor Xxxxxx
shall be prohibited or restricted in connection with any communications with
any
regulatory or self-regulatory organization or any law enforcement authority
or
pursuant to court order or lawful subpoena or other legal process, or from
making any other disclosure required by law. In the event that Xxxxxx determines
to issue a press release the primary purpose of which is to announce the
resignation of Xxxxx as contemplated by this Agreement, Xxxxxx will provide
Xxxxx with a copy of the proposed press release in advance of its publication
and agrees to consider any comments to the proposed press release provided
by
Xxxxx.
11. Except
as
expressly provided in this Separation Agreement and General Release, Xxxxx
shall
not be entitled to any money or other consideration from Xxxxxx. Xxxxx
acknowledges he is receiving under this Separation Agreement and General Release
consideration in addition to anything of value to which he already is
entitled.
12. In
executing this Separation Agreement and General Release, neither Xxxxxx nor
Xxxxx admits any liability or wrongdoing, and the considerations exchanged
herein do not constitute an admission of any liability, error, contract
violation, or violation of any federal, state or local law or
regulation.
13. This
Separation Agreement and General Release shall be binding upon and inure to
the
benefit of the parties hereto and their respective successors and permitted
assigns.
14. The
unenforceability or invalidity of any provision or provisions of this Separation
Agreement and General Release shall not render any other provision or provisions
hereof unenforceable or invalid.
15. This
Separation Agreement and General Release constitutes the entire agreement
between the parties, supersedes all existing agreements, whether written or
oral, regarding Xxxxx’x employment by Xxxxxx, and cannot be altered except in a
writing signed by the parties. The parties acknowledge that they entered into
this Separation Agreement and General Release voluntarily, that they fully
understand all of its provisions, and that no representations were made to
induce execution of this Separation Agreement and General Release which are
not
expressly contained herein.
16. This
Separation Agreement and General Release shall be deemed to have been made
in
the State of New York, and shall be interpreted and construed and enforced
in
accordance with the laws of the State of New York without regard to principles
of conflicts of law or where the parties are located at the time a dispute
arises. Any dispute arising out of or relating to this Separation Agreement
and
General Release shall be commenced in any state or federal court sitting in
the
County of New York in the State of New York, and Xxxxx and Xxxxxx consent to
the
jurisdiction of such courts for such purposes.
17. Xxxxx
is
advised to consult with the attorneys of his choice prior to executing this
Separation Agreement and General Release. Xxxxx acknowledges that he has had
the
opportunity to consult with counsel and has had an adequate opportunity to
review this Separation Agreement and General Release before its
execution.
18. Xxxxx
acknowledges that he has been afforded an opportunity to take at least
twenty-one (21) days to consider this Separation Agreement and General Release
and has been and hereby is advised to consult with the attorneys of his choice
prior to executing this Separation Agreement and General Release. Xxxxx further
acknowledges that he will have a period of seven (7) calendar days following
his
execution of this Separation Agreement and General Release in which to revoke
his consent, and that the Separation Agreement and General Release will not
become effective or enforceable until the revocation period has expired. A
revocation will become effective only if Xxxxx furnishes Xxxxxx with a written
notice to I.C. Xxxxxx & Co., Inc., 000 00xx
Xxxxxx,
0xx
Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attn: Xxxxx X. Xxxxx, Chief Financial
Officer, such
that
it is actually received within such seven (7) day period. Xxxxxx will have
no obligation to make the payments set forth herein unless and until this
Separation Agreement and General Release becomes effective.
IN
WITNESS WHEREOF, the parties have executed this Separation Agreement and General
Release on the dates indicated below.
/s/Xxxxx
X. Xxxxx
Xxxxx
X.
Xxxxx Date:
April 5, 2007
I.C.
Xxxxxx & Co., Inc.
By:
/s/Xxxxx
X. Xxxxx
Xxxxx
X.
Xxxxx Date:
April 5, 2007
Executive
Vice President &
Chief
Financial Officer
