SEVERANCE AGREEMENT AND RELEASE
This AGREEMENT dated January 31, 2002 is made by and between Saucony, Inc.
(the "Company") and Xxxxxx Xxxxxx, Xx. (the "Employee").
WHEREAS, the parties wish to resolve amicably the Employee's separation
from the Company and establish the terms of the Employee's severance
arrangement;
NOW, THEREFORE, in consideration of the promises and conditions set forth
herein, the sufficiency of which is hereby acknowledged, the Company and the
Employee agree as follows:
1. Termination Date. The Employee's effective date of termination from the
Company is January 4, 2002 (the "Termination Date").
2. Monetary Consideration. In return for the execution of the instant
Severance Agreement and Release, the Company agrees to pay the Employee Two
Hundred and Forty-five Thousand Dollars ($245,000), from which the Company
may withhold all applicable state and federal taxes, as severance pay (the
"Severance Pay"). The Severance Pay will be paid to the Employee bi-weekly
over a twelve (12) month period with the first payment to be paid no
earlier than eight days after execution of the Agreement and provided that
the Employee has not revoked his acceptance of the Agreement during the
seven (7) day revocation period. Additionally, as further consideration,
the Company agrees to continue the Employee's coverage under the Company's
group health and dental plans, for a twelve (12) month period commencing on
the Employee's Termination Date (the "Benefits Period"). During the
Benefits Period, the Company will pay the share of the premium for such
coverage that is paid by the Company for active employees who receive the
same type of coverage. The Employee agrees to pay his share of the premium
($89.90) during the Benefits Period, which shall be deducted bi-weekly from
the Severance Pay described in this Paragraph. At the end of the Benefits
Period, the Employee may elect to continue his group health and/or dental
coverage pursuant to the federal "COBRA" law, 29 U.S.C. ss. 1161 et seq.
for the remainder of the COBRA period by paying 100% of the premium for as
long as and to the extent that the Employee remains eligible for COBRA, and
the Company will provide the Employee with all necessary information
regarding making such an election.
3. Employee Release. The Employee hereby fully, forever, irrevocably and
unconditionally releases, remises and discharges the Company, its officers,
directors, stockholders, corporate affiliates, subsidiaries, and parent
companies, agents, employees, and attorneys from any and all claims,
charges, complaints, demands, actions, causes of action, suits, rights,
debts, sums of money, costs, accounts, reckonings, covenants, contracts,
agreements, promises, doings, omissions, damages, executions, obligations,
liabilities, and expenses (including attorneys' fees and costs), of every
kind and nature which he ever had or has as of the date of this Agreement
against the Company, its officers, directors, stockholders, corporate
affiliates, subsidiaries and parent companies, agents, employees and
attorneys, arising out of his employment with or separation from the
Company including, but not limited to, all employment discrimination claims
under Title VII of the Civil Rights Act of 1964, 42 U.S.C. ss. 2000e et
seq., the Age Discrimination in Employment Act, 29 U.S.C., ss. 621 et seq.,
the Americans With Disabilities Act of 1990, 42 U.S.C., ss. 12101 et seq.,
and the Massachusetts Fair Employment Practices Act, M.G.L. c. 151B, ss. 1
et seq., all as amended, and all claims arising out of the Fair Credit
Reporting Act, 15 U.S.C. ss. 1681 et seq., the Employee Retirement Income
Security Act of 1974 ("ERISA"), 29 U.S.C. ss. 1001 et seq., the
Massachusetts Civil Rights Act, M.G.L. c. 12 xx.xx. 11H and 11I, the
Massachusetts Equal Rights Act, M.G.L. c. 93 ss. 102 and M.G.L. c. 214, ss.
1C, the Massachusetts Labor and Industries Act, M.G.L. c. 149, ss. 1 et
seq., and the Massachusetts Privacy Act, M.G.L. c. 214, ss. 1B, all as
amended, and all common law claims including, but not limited to, actions
in tort, defamation and breach of contract, and any claim or damage arising
out of the Employee's employment with or separation from the Company
(including a claim for retaliation) under any common law theory or any
federal, state or local ordinance not expressly referenced above, excepting
only a claim for breach of this Agreement; provided, however, that nothing
in this Agreement prevents him from filing, cooperating with, or
participating in any proceeding before the EEOC or a state Fair Employment
Practices Agency (except that the Employee acknowledges that he may not be
able to recover any monetary benefits in connection with any such claim,
charge or proceeding).
4. Company Release. The Company hereby fully, forever, irrevocably and
unconditionally releases, remises and discharges the Employee, his heirs
and personal representatives, from any and all claims, charges, complaints,
demands, actions, causes of action, suits, rights, debts, sums of money,
costs, accounts, reckonings, covenants, contracts, agreements, promises,
doings, omissions, damages, executions, obligations, liabilities, and
expenses (including attorneys' fees and costs), of every kind and nature
which it ever had or has as of the date of this Agreement against the
Employee arising out of his employment with or separation from the Company,
including without limitation all common law claims including, but not
limited to, actions in tort, defamation and breach of contract, and any
claim or damage arising out of the Employee's employment with or separation
from the Company (including a claim for retaliation) under any common law
theory or any federal, state or local ordinance not expressly referenced
above, excepting only any claim for breach of this Agreement and any
violation of the Employee Patent and Proprietary Information Agreement
signed by the Employee.
5. Non-Disclosure. The Employee acknowledges his obligation to keep
confidential all non-public information concerning the Company which he
acquired during the course of his employment with the Company, as stated
more fully in the Employee Patent and Proprietary Information Agreement
executed by the Employee at the inception of his employment which remains
in full force and effect.
6. Return of Company Property. The Employee confirms that he has returned to
the Company all keys, files, records (and copies thereof), equipment and
other Company-owned property in his possession or control. In addition, the
Employee agrees to leave intact all electronic documents of the Company,
including those which he developed or help develop during his employment.
7. Non-Disparagement. The Employee understands and agrees that as a condition
for payment to him of the consideration described herein, he will not make
any false, disparaging or derogatory statements to any third party,
including but not limited to, any media outlet, industry group, investors,
financial institution or current or former employee, consultant, client or
customer of the Company or any of its subsidiaries regarding the Company or
any of its subsidiaries or any of their directors, officers, employees,
agents or representatives or about the Company's or any of its
subsidiaries' business affairs and financial condition. The Company
understands and agrees that it will direct those privy to the terms of this
Agreement not to make any false, disparaging or derogatory statements to
any third party, including but not limited to, any media outlet, industry
group, current or potential employer of the Employee, financial institution
or current or former employee, consultant, client or customer of the
Company or any of its subsidiaries regarding the Employee, his employment
by the Company or the circumstances of the termination of his employment by
the Company.
8. Non-Competition, Non-Solicitation and Non-Hire. For a period of twelve (12)
months following the Employee's termination, the Employee will not,
directly or indirectly:
(a) Engage in any business or enterprise (whether as an owner, partner,
officer, employee, director, investor, lender, consultant, independent
contractor or otherwise, except as the holder of not more than 1% of the
combined voting power of the outstanding stock of a publicly held company)
that designs, manufactures and/or (exclusively or primarily at wholesale)
sells athletic running shoes and is competitive with the Company's
business;
(b) Either alone or in association with others, solicit, divert or take away,
or attempt to divert or to take away, the business or patronage of any of
the clients, customers or accounts, or prospective clients, customers or
accounts, of the Company which were contacted, solicited or served by the
Employee while he/she was employed by the Company.
(c) Either alone or in association with others, recruit, solicit, hire or
engage as an independent contractor, any person who was employed by the
Company or any of its subsidiaries at any time during the period of the
Employee's employment with the Company, except for an individual whose
employment with the Company has been terminated for a period of six months
or longer.
(d) If any restriction set forth in this Section 8 is found by any court of
competent jurisdiction to be unenforceable because it extends for too long
a period of time or over too great a range of activities or in too broad a
geographic area, it shall be interpreted to extend only over the maximum
period of time, range of activities or geographic area as to which it may
be enforceable.
(e) The Employee acknowledges that the restrictions contained in this Agreement
are necessary for the protection of the business and goodwill of the
Company and are considered by the Employee to be reasonable for such
purpose. The Employee agrees that any breach of this Agreement will cause
the Company substantial and irrevocable damage and therefore, in the event
of any such breach, in addition to such other remedies which may be
available, the Company shall have the right to seek specific performance
and injunctive relief without posting a bond.
(f) The geographic scope of this Section shall extend to anywhere the Company
or any of its subsidiaries is doing business, has done business or has
plans to do business.
(g) If the Employee violates the provisions of this Section, the Employee shall
continue to be held by the restrictions set forth in this Section, until a
period equal to the period of restriction has expired without any
violation.
9. Confidentiality. To the extent permitted by law, the parties understand and
agree that for the mutual consideration herein described, the terms and
contents of this Agreement, and the contents of the negotiations and
discussions resulting in this Agreement, shall be maintained as
confidential by the parties hereto, and their respective agents and
representatives, and none of the above shall be disclosed except to the
extent required by federal or state law or as otherwise agreed to in
writing by the other party.
10. Nature of Agreement. The Employee understands and agrees that this
Agreement is a severance agreement and does not constitute an admission of
liability or wrongdoing on the part of the Company.
11. Amendment. This Agreement shall be binding upon the parties and may not be
abandoned, supplemented, changed or modified in any manner, orally or
otherwise, except by an instrument in writing of concurrent or subsequent
date signed by a duly authorized representative of the parties hereto. This
Agreement is binding upon and shall inure to the benefit of the parties and
their respective agents, assigns, heirs, executors, successors and
administrators.
12. Waiver of Rights. No delay or omission by either party in exercising any
rights under this Agreement shall operate as a waiver of that or any other
right. A waiver or consent given by a party on any one occasion shall be
effective only in that instance and shall not be construed as a bar or
waiver of any right on any other occasion.
13. Validity. Should any provision of this Agreement be declared or be
determined by any court of competent jurisdiction to be illegal or invalid,
the validity of the remaining parts, terms, or provisions shall not be
affected thereby and said illegal or invalid part, term or provision shall
be deemed not to be a part of this Agreement.
14. Applicable Law, Jurisdiction, Waiver of Jury Trial. This Agreement shall be
governed by the laws of the Commonwealth of Massachusetts, without regard
to conflict of laws provisions. The parties hereby irrevocably submit to
the jurisdiction of the courts of the Commonwealth of Massachusetts, or if
appropriate, a federal court located in Massachusetts (which courts, for
purposes of this Agreement, are the only courts of competent jurisdiction),
over any suit, action or other proceeding arising out of, under, or in
connection with this Agreement or its subject matter. THE PARTIES FURTHER
AGREE TO WAIVE ANY JURY TRIAL RIGHT AND AGREE TO HAVE ANY SUIT, ACTION OR
OTHER PROCEEDING ARISING OUT OF THIS AGREEMENT DECIDED BY A JUDGE.
15. Acknowledgments. The Employee acknowledges that he has been given
twenty-one (21) days to consider this Agreement and that the Company
advised him to consult with an attorney of his own choosing prior to
signing this Agreement. Further, the Employee acknowledges he may revoke
this Agreement for a period of seven (7) days after the execution of this
Agreement, and the Agreement shall not be effective or enforceable until
the expiration of this seven (7) day revocation period.
16. Voluntary Assent. The Employee affirms that no other promises or agreements
of any kind have been made to or with him by any person or entity
whatsoever to cause him to sign this Agreement, and that he fully
understands the meaning and intent of this Agreement. The Employee states
and represents that he has had an opportunity to fully discuss and review
the terms of this Agreement with an attorney. The Employee further states
and represents that he has carefully read this Agreement, understands the
contents herein, freely and voluntarily assents to all of the terms and
conditions hereof, and signs his name of his own free act.
17. Time To Accept Offer. This offer to enter into the Severance Agreement and
Release (the "Offer") will continue to remain open until January 25, 2002.
If an executed Agreement is not received by the Company on that date, the
Offer will officially be revoked.
18. Entire Agreement. This Agreement contains and constitutes the entire
understanding and agreement between the parties hereto with respect to the
severance and supercedes all previous oral and written negotiations,
agreements, commitments, and writings in connection therewith. Nothing in
this Section shall, however, modify, cancel or supercede the Employee's
obligations set forth in Section 8.
19. Counterparts. This Agreement may be executed in two (2) signature
counterparts, each of which shall constitute an original, but all of which
taken together shall constitute but one and the same instrument.
IN WITNESS WHEREOF, all parties have set their hand and seal to this
Agreement as of the date written above.
XXXXXX XXXXXX, XX. SAUCONY, INC.
/s/Xxxxxx Xxxxxx, Xx. /s/ Xxxxxxx Xxxxx
Xxxxxxx Xxxxx
