EXHIBIT 10.3
EMPLOYMENT RESIGNATION AGREEMENT AND RELEASE
For valuable consideration, the receipt and sufficiency of which the
parties acknowledge, this Employment Resignation Agreement and Release
(hereinafter "Agreement") is entered into this 28th day of August 2007, by and
between Xxxxx Xxxx (hereinafter "Sink") and SteelCloud, Inc. (hereinafter
"SteelCloud").
Whereas, Sink and SteelCloud entered into an Employment Agreement dated
June 7, 2006 (hereinafter the "Employment Agreement"), and
Whereas, Sink now wishes to resign from SteelCloud prior to the full
term of the Employment Agreement in order to pursue other activities, and
Whereas, SteelCloud agrees to accept Sink's resignation and to provide
him certain benefits in recognition of the services and value he has brought to
the Company.
Now, therefore, the parties agree as follows:
1. RESIGNATION. Sink resigns from SteelCloud effective November 1,
2007, and from now until then, will act to transition his duties and
responsibilities to a replacement selected by the Board of Directors, in a
manner and on a schedule as directed by the Board. Sink resigns from Board
immediately.
2. PUBLIC ANNOUNCEMENT. Subject to and to the extent permitted by
requirements of law, SteelCloud will announce Sink's resignation so as to allow
him to pursue other activities, and include an explanation that Sink joined the
company to help turn it around financially, which task he completed. Sink shall
be permitted input into said announcement. SteelCloud shall provide Sink
positive references upon request.
3. PAYMENT TO SINK. On or before November 1, 2007, SteelCloud shall pay
to Sink the sum of $237,500 in a lump sum, less any taxes and other required
withholdings. Any vacation time not used by the effective date of this agreement
(above) will be paid to Sink, less any taxes and required withholdings by
SteelCloud at the same time as the lump sum. No vacation time will be accrued
after the date of this agreement. Said amount is accepted by Sink as the entire
liability of SteelCloud for sums due or in the future to be due under the
Employment Agreement between SteelCloud and Sink, including any bonuses under
said Employment Agreement. Sink may direct SteelCloud to delay all or part of
this payment at his discretion. In addition, SteelCloud shall pay the cost of
COBRA coverage after October 31. 2007, for Sink for a period ending the earlier
of (a) Sink's employment with or contract to another company where he is
eligible for health care coverage, or (b) June 30, 2009.
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4. STOCK OPTIONS. SteelCloud agrees to allow 170,000 stock options held
by Sink under his separate stock Option Agreement dated November 24, 2006
(hereinafter "Option Agreement"), to vest and to be exercisable as of November
1, 2007, instead of November 24, 2007, as otherwise provided in the Option
Agreement. Sink forfeits all remaining stock options under the Option Agreement.
5. COVENANT NOT TO XXX AND AGREEMENT TO COOPERATE. Sink and SteelCloud
covenant that neither will in the future file any legal actions against the
other, whether in court or before any administrative agency, arising from or
relating to the Employment Agreement, Option Agreement, or Sink's employment
with SteelCloud. The parties agree that the damages arising from breach of this
paragraph will be substantial, but difficult to determine with certainty.
Therefore the parties agree as follows (a) Sink's breach of any covenant in this
paragraph shall require Sink to pay liquidated damages to SteelCloud in the
amount of two times the amount SteelCloud has agreed to pay Sink in paragraph 3
of this Agreement, and (b) SteelCloud's breach of any covenant in this paragraph
shall require SteelCloud to pay liquidated damages to Sink in the amount
SteelCloud has agreed to pay Sink in paragraph 3 of this Agreement.
Notwithstanding the foregoing, both parties, shall, upon reasonable notice,
furnish such information and proper assistance to the other party as it may
reasonably require in connection with any litigation in which it is, or may
become, a party after execution of this Agreement. In the event that either
party fails to assist the other, it shall reimburse the other party all legal
fees, court costs and damages resulting in whole or in part from this failure to
assist.
6. EMPLOYMENT AGREEMENT PROVISIONS. Sink agrees that the following
provisions of the Employment Agreement shall continue in full force and effect,
notwithstanding anything in this Agreement to the contrary: paragraphs 6, 7(d),
8, and 10 (as it relates to any paragraph which remains in full force and
effect). Notwithstanding the foregoing, the definition of "competing business"
in paragraph 8(a) of the Employment Agreement, shall be amended to mean the
following: NCS, Patriot Technologies, Granite Technologies, M&A Technologies,
Network Engines, Inc. (and any affiliates of the foregoing); or any entity which
sells specialized appliance platforms to any current customer of SteelCloud or
to any person or entity to which SteelCloud has marketed itself during Sink's
employment with the company; or any entity which sells antivirus, intrusion
protection or security appliances or services to any current customer of
SteelCloud or to any person or entity to which SteelCloud has marketed itself
during Sink's employment with the company. Other than these paragraphs, the
parties agree that the terms of the Employment Agreement shall terminate upon
execution of this Agreement.
7. RELEASE. Except for the requirements of this Agreement, each of
SteelCloud and Sink, for itself and himself, and each's representatives, agents,
officers, successors, affiliates and assigns, hereby release, acquit and forever
discharge the other party and its stockholders, agents, employees, officers,
directors, servants, representatives, successors, affiliates and assigns, from
any and all actions, suits, debts, dues, sums of money, accounts, claims for
attorneys' fees, reckonings, bonds, bills, specialties, covenants, contracts,
controversies, agreements, promises, variances, trespasses, damages, judgments,
extents, executions, claims, and demands whatsoever, whether known or unknown,
in law, or equity, which either now has, or ever had, or may have in the future
by reason of any matter, cause or thing whatsoever, including but not limited to
those matters arising from or concerning the Employment Agreement or Option
Agreement, or SteelCloud's or Sink's obligations thereunder, direct or indirect,
and any and all other agreements, written or oral, between SteelCloud and Sink
entered into on or prior to the date of this Agreement, or any other employment
related matter.
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8. MISCELLANEOUS.
a. This Agreement sets forth all of the parties' promises, agreements,
conditions, warranties and representations, oral or written, express or implied,
among them with respect to the terms of this Agreement, and there are no
promises, agreements, conditions, warranties or representations, oral or
written, express or implied, among them with respect to the matters addressed
herein other than as set forth herein.
b. Except as stated herein, this Agreement supersedes any prior
agreements between Sink and SteelCloud.
c. Any modification of this Agreement or additional obligation assumed
by either party in connection with this Agreement shall be binding only if
placed in writing and signed by each party or an authorized representative of
each party.
d. This Agreement shall inure to the benefit of, and shall be binding
upon, the parties and their respective successors, heirs, and personal
representatives.
e. This Agreement shall not be assignable by Sink.
f. The failure of either party to this Agreement to insist upon the
performance of any of the terms and conditions of this Agreement, or the waiver
of any breach of any of the terms and conditions of his Agreement, shall not be
construed as thereafter waiving any such terms and conditions, but the same
shall continue and remain in full force and effect as if no such forbearance or
waiver had occurred.
g. The parties hereto stipulate and agree that the rule of construction
to the effect that any ambiguities are to be or may be resolved against the
drafting party shall not be employed in the interpretation of this Agreement.
IN WITNESS WHEREOF, each party to this Agreement has caused it to be
executed on the date indicated above.
READ AND AGREED: READ AND AGREED:
Xxxxx Xxxx SteelCloud, Inc.
/S/ XXXXXXX X. XXXX /S/ VADM X.X.XXXXXXXXXX
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VADM X.X.XXXXXXXXXX
its Chairman of the Board
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