EXHIBIT 10.40
TERMINATION AND SETTLEMENT AGREEMENT
AGREEMENT, dated as of July 3, 1996, by and between EDITEK, Inc., a
Delaware corporation (the "Company"), and Xxxxx X. Xxxxxxx ("Xxxxxxx").
WHEREAS, the Company and Xxxxxxx are parties to an Employment Agreement
effective January 30, 1996 (the "Employment Agreement"); and
WHEREAS, Xxxxxxx has agreed to resign from certain positions with the
Company, the Company and Xxxxxxx have agreed to mutually terminate the
Employment Agreement and the Company has agreed to make certain payments to
Xxxxxxx, all upon the terms and subject to the conditions set forth in this
Agreement;
NOW THEREFORE, in consideration of the premises and the mutual
agreements set forth herein, the parties hereto, intending to be legally bound,
agree as follows:
1. The Employment Agreement (except for Sections 12 and 14 thereof,
which, it is expressly agreed, shall survive the execution of this Agreement),
and Xxxxxxx'x employment by the Company, is hereby terminated without further
liability on the part of either the Company or Xxxxxxx except as specifically
provided in this Agreement.
2. Concurrently with the execution and delivery of this Agreement the
Company and Xxxxxxx have executed and delivered to the other a general release
in the form of Exhibits A and B hereto, respectively.
3. Xxxxxxx hereby resigns, effective immediately, all positions with the
Company and each of its subsidiaries and affiliates, including, without
limitation, as a Director of the Company and as the President and Chief
Executive Officer of the Company.
4. Except as set forth in Paragraph 5, in full and complete satisfaction
of all amounts due to Xxxxxxx from the Company, including, without limitation,
all amounts of salary, bonus, benefits and severance payable under the
Employment Agreement, the Company shall make the following payments to Xxxxxxx:
(i) $100,000 plus the amount of Xxxxxxx'x accrued and unpaid vacation through
the date hereof upon execution of this Agreement; and (ii) $12,941.18 per month
on the first business day of each calendar month commencing with August, 1996 to
and including December, 1997. All payment provided for in this Paragraph 4 shall
be made to Xxxxxxx regardless of his procuring other employment.
5. The Company shall reimburse Xxxxxxx for all expenses of the type
referred to in Section 4. of the Employment Agreement incurred by Xxxxxxx
through the date hereof in accordance with the Company's current expense
reimbursement policy.
6. Xxxxxxx hereby elects to purchase the life insurance policy referred
to in Section 3.3 of the Employment Agreement. This provision shall constitute
the notice required to be given to the Company by Xxxxxxx pursuant to said
Section 3.3.
7. Xxxxxxx shall promptly return to the Company all Company property in
his possession, including the cellular telephone.
8. The Company hereby releases Xxxxxxx from all liability to the Company
under the Promissory Note, dated September 10, 1988 made payable to the Company
in the original principal amount of $100,000 and the related Pledge Agreement
dated such date. Xxxxxxx sells, assigns and transfers to the Company all of his
right, title and interest in and to the shares of the Company's stock securing
the payment of said Promissory Note referred to in said Pledge Agreement.
9. (a) Xxxxxxx agrees that he will not, for a period of 24
months after the date hereof, directly or indirectly, solicit for employment by
any person or entity any one or more employees of the Company, or aid or assist
any person or entity in so doing or otherwise interfere with the Company's
relationships with any one or more of its employees.
(b) Xxxxxxx agrees that he will not, at any time after the date hereof,
say, publish or do any thing, the purpose or intent of which is to cause harm or
damage to the Company or its business.
(c) The Company shall not, at any time after the date hereof, take any
action to interfere with Xxxxxxx'x attempts to procure other employment nor will
the Company say, publish or do any thing, the purpose or intent of which is to
cause harm or damage to Xxxxxxx or Xxxxxxx'x reputation.
(d) The parties acknowledge that a breach of this Paragraph 9 will
cause the other party irreperable harm and, accordingly, such other party shall
have the right to seek an injunction or other equitable relief in addition to
all other remedies at law or in equity. Each of the parties waives any
requirement that the party seeking an injunction or other equitable remedy post
a bond or other security.
10. Except for disclosures by the Company required, in its reasonable
judgement or upon advice of counsel, by applicable law, rules or regulations,
neither the Company or Xxxxxxx shall, directly or indirectly, disclose, divulge,
communicate or otherwise reveal or allow to be revealed to anyone other than
their respective attorneys, accountants or immediate family members, the terms,
substance or content of this Agreement or the terms, substance or content of any
communications, whether written or oral, concerning the negotiation, execution
or implementation of this Agreement.
11. This Agreement may not be amended except by written instrument signed
by the party to be charged. This Agreement shall be governed by the laws of
North Carolina. This Agreement shall be binding upon the parties hereto and
their respective heirs, successors and assigns, provided that neither this
Agreement nor any right or obligation hereunder may be assigned by either party
without the written consent of the other party, which consent may be withheld
for any reason. This Agreement and the Releases referred to herein represent the
entire agreement between the parties with respect to the subject matter hereof
and all prior discussions and negotiations are superseded hereby. Because all
parties were represented by counsel, rules of construction concerning the
interpretation of this Agreement against the draftsman shall not apply. This
Agreement may be executed in counterparts, each of which shall constitute an
original hereof, but together such counterparts shall constitute on agreement.
IN WITNESS WHEREOF, the parties have executed or caused the execution
of this Agreement as of the date first above written.
EDITEK, Inc.
By: ________________
Its: Vice President
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Xxxxx X. Xxxxxxx
