SEPARATION AGREEMENT AND RELEASE OF CLAIMS
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SEPARATION
AGREEMENT AND RELEASE OF CLAIMS
THIS
AGREEMENT is made and entered into by and between NexCen
Brands, Inc.
(the
“Company”) and Xxxxxxx
X. Xxxx (the
“Executive”).
All
capitalized terms used herein unless otherwise defined in this Agreement shall
have the meaning assigned to them in the Employment Agreement.
WHEREAS,
the Company and Executive entered into an employment agreement made as of
December 11, 2006 (the “Employment Agreement”);
WHEREAS,
Executive’s employment was terminated by the Company without Cause effective as
of May 30, 2008 (“Termination Date”), and as of such date Executive ceased to
hold any position as an officer of the Company or any affiliate;
and
WHEREAS,
Executive desires to receive separation pay and benefits, and the Company is
willing to provide separation pay and benefits on the condition that Executive
enters into this Agreement.
THEREFORE,
in consideration of the mutual agreements and promises set forth within this
Agreement, the receipt and sufficiency of which are hereby acknowledged, the
Company and Executive agree as follows:
| 1. |
Consideration
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In
consideration of Executive's agreements and promises set forth below, the
Company will provide to Executive the following separation payments pursuant
to
the Employment Agreement:
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a.
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Base
Salary, Accrued Paid Time Off. The
Company shall pay to Executive any unpaid Base Salary through and
including the Termination Date. Executive acknowledges that there
is no
declared but unpaid Annual Bonus or any other bonus during the Employment
Period that is due and owing to the Executive as of the Termination
Date.
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The
Company shall pay to Executive all accrued but unused paid time during the
Employment Period through and including the Termination Date. The parties
acknowledge and agree that as of Termination Date, Executive has accrued
$29,000.00 of paid time off and has received $24,615.38 of that amount, less
deductions for federal and/or state income tax withholding, FICA and any other
deduction from wages required by law or regulation. The Company shall pay the
remaining $4,384.62 of accrued paid time off, less deductions for federal and/or
state income tax withholding, FICA and any other deduction from wages required
by law or regulation, by including such net amount in the next semi-monthly
installment payment to be made pursuant to subparagraph 1.b. below, following
execution of this Agreement.
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b.
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Semi-Monthly
Installment Payment.
The Company shall pay to Executive payments totaling One
Hundred Fifty Thousand Dollars ($150,000.00)
(less deductions for federal and/or state income tax withholding,
FICA and
any other deduction from wages required by law or regulation), which
shall
be paid in substantially equal semi-monthly installments over a period
of
six months, beginning no later than June 16, 2008, in accordance
with the
Company’s normal payroll practices.
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c.
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Continued
Participation in Company’s Group Medical Plan. The
Company shall continue Executive’s participation in the Company’s group
medical plan on the same basis as he previously participated, until
the
earlier of May
30, 2009
or
the date Executive is provided with health insurance coverage by
a
successor employer. Executive shall promptly inform Xxx Xxx, General
Counsel of the Company, if and when he is provided with health insurance
coverage by a successor employer. After
May 30, 2009, Executive may continue to participate in the
Company’s group health plans to the extent permitted under the
Consolidated Omnibus Budget Reconciliation Act (“COBRA”).
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d.
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Reimbursable
Expenses. Executive
acknowledges and agrees that as of the date of this agreement, he
has
received all reimbursable expenses or other entitlements then due
and
owing to the Executive.
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e.
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Stock
Options.
The parties hereby agree that (i) Executive vested as of December
11, 2007
in (i) 83,334 shares of
his initial Option Grant to purchase a total of 250,000 shares of
the
Company’s common stock; (ii) Executive vested as of the Termination Date
in all of his additional stock option grant to purchase a total of
25,000
shares of the Company’s common stock; and (iii) Executive voluntarily
surrendered 166,666 shares of his unvested initial Option Grant.
Executive’s 108,334 vested stock options shall be exerciseable as of the
Termination Date and shall remain exercisable by Executive (or his
estate,
in the event of his death) until December 31, 2009, following which
time
any unexercised stock options shall terminate.
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f.
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Other
Benefits.
Executive shall receive any vested benefits to which Executive is
entitled
in accordance with the terms of any of the Company's employee benefit
plans or programs, including without limitation the Company's 401(k)
plan.
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The
terms
of Paragraph 1 shall have no force if Executive revokes his acceptance of this
Agreement pursuant to Paragraph 11 (Special Provisions for Age
Discrimination).
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| 2. |
No
Further Payments
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Except
as
provided for in Paragraph 1, Executive is not entitled to and will not receive
any further salary, wages, benefits, severance or separation payments from
the
Company.
| 3. |
General
Release
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Executive
on behalf of himself and his heirs, successors and assigns, in consideration
of
the performance by the Company of its material obligations under the Employment
Agreement and this Agreement, do hereby release and forever discharge as of
the
date hereof the
Company,
its
Subsidiaries, its Affiliates, each such Person’s respective successors and
assigns and each of the foregoing Persons’ respective present and former
directors, officers, partners, stockholders, members, managers, agents,
representatives, employees (and each such Person’s respective successors and
assigns) (collectively, the “Released
Parties”)
to the
extent provided below.
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a.
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Executive
understands that payments or benefits paid or granted to him under
this
Agreement represent, in part, consideration for signing this Agreement
and
are not salary, wages or benefits to which he was already entitled.
Executive understands and agrees that he will not receive the payments
and
benefits specified in Paragraph 1 (other than the payments and benefits
in
subparagraphs 1.a and 1.f) of this Agreement unless he executes this
Agreement and does not revoke this Agreement within the time period
permitted hereafter or breach this
Agreement.
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b.
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Executive
knowingly and voluntarily releases and forever discharges the
Company
and the other Released Parties from any and all claims, controversies,
actions, causes of action, cross-claims, counter-claims, demands,
debts,
compensatory damages, liquidated damages, punitive or exemplary damages,
other damages, claims for costs and attorneys’ fees, or liabilities of any
nature whatsoever in law and in equity, both past and present (through
the
date of this Agreement), whether under the laws of the United States
or
another jurisdiction and whether known or unknown, suspected or claimed
against the
Company
or
any of the Released Parties which Executive, his spouse, or any of
his
heirs, executors, administrators or assigns, have or may have, which
arise
out of or are connected with his employment with, or his separation
from,
the
Company
(including, but not limited to, any allegation, claim or violation,
arising under: Title VII of the Civil Rights Act of 1964, as amended;
the
Civil Rights Act of 1991; the Age Discrimination in Employment Act
of
1967, as amended (including the Older Workers Benefit Protection
Act); the
Equal Pay Act of 1963, as amended; the Americans with Disabilities
Act of
1990; the Family and Medical Leave Act of 1993; the Civil Rights
Act of
1866, as amended; the Worker Adjustment Retraining and Notification
Act;
the Employee Retirement Income Security Act of 1974; any applicable
Executive Order Programs; the Fair Labor Standards Act; or their
state or
local counterparts; or under any other federal, state or local civil
or
human rights law, or under any other local, state, or federal law,
regulation or ordinance; or under any public policy, contract
or
tort, or under common law; or arising under any policies, practices or
procedures of the
Company
or
any of the Released Parties; or any claim for wrongful discharge,
breach
of contract,
infliction of emotional distress, or defamation; or any claim for
costs,
fees, or other expenses, including attorneys’ fees incurred in these
matters (all of the foregoing collectively referred to herein as
the
“Claims”); provided, however, that nothing contained in this Agreement
shall apply to, or release the
Company
from, (i) any obligation of the
Company
contained in the Employment Agreement or this Agreement to be performed
after the date hereof, (ii) any vested or accrued benefits pursuant
to any employee benefit plan, program or policy of the
Company,
(iii) any right Executive has to indemnification by the Company (under
the
Employment Agreement or otherwise), and (iv) any claims Executive
may have
as a member of a class in connection with any securities derivative
class
action against the Company.
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c.
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Executive
represents that he has made no assignment or transfer of any right,
claim,
demand, cause of action, or other matter covered by paragraph 3.b.
above.
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d.
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Executive
agrees that this Agreement does not waive or release any rights or
claims
that he may have under the Age Discrimination in Employment Act of
1967
which arise after the date he executes this Agreement. Executive
acknowledges and agrees that his separation from employment with
the
Company
in
compliance with the terms of the Employment Agreement and this Agreement
shall not serve as the basis for any claim or action (including,
without
limitation, any claim under the Age Discrimination in Employment
Act of
1967).
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e.
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In
signing this Agreement, Executive acknowledges and intends that the
Agreement shall be effective as a bar to each and every one of the
Claims
hereinabove mentioned or implied. Executive expressly consents that
this
General Release shall be given full force and effect according to
each and
all of its express terms and provisions, including those relating
to
unknown and unsuspected Claims (notwithstanding any state statute
that
expressly limits the effectiveness of a general release of unknown,
unsuspected and unanticipated Claims), if any, as well as those relating
to any other Claims hereinabove mentioned or implied. Executive
acknowledges and agrees that this waiver is an essential and material
term
of this Agreement and that without such waiver the
Company
would not have agreed to the terms of the Agreement. Executive covenants
that he shall not directly or indirectly, commence, maintain or prosecute
or xxx any of the Released Persons either affirmatively or by way
of
cross-complaint, indemnity claim, defense or counterclaim or in any
other
manner or at all on any Claim covered by this General Release. Executive
further agrees that in the event he should bring a Claim seeking
damages
against the
Company,
or in the event he should seek to recover against the
Company
in
any Claim brought by a governmental agency on his behalf, this Agreement
shall serve as a complete defense to such Claims. Executive further
agree
that he is not aware of any pending charge or complaint of the type
described in paragraph 3.b. as of the execution of this
Agreement.
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| 4. |
No
Admission of Liability.
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Executive
agrees that neither this Agreement, nor the furnishing of the consideration
for
this Agreement, shall be deemed or construed at any time to be an admission
by
the
Company,
any
Released Party or Executive of any improper or unlawful conduct.
| 5. |
Confidentiality.
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Executive
agrees that this Agreement is confidential and agree not to disclose any
information regarding the terms of this Agreement, except to his immediate
family and any tax, legal or other counsel he has consulted regarding the
meaning or effect hereof or as required by law, and Executive will instruct
each
of the foregoing not to disclose the same to anyone.
Any
non-disclosure provision in this Agreement does not prohibit or restrict
Executive (or his attorney) from responding to any inquiry about this Agreement
or its underlying facts and circumstances by the Securities and Exchange
Commission, the National Association of Securities Dealers, Inc. or any other
self-regulatory organization or governmental entity.
| 6. |
Affirmation
of Employment Agreement.
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Except
as
otherwise provided in this Agreement, the parties hereby expressly re-affirm
the
Employment Agreement, including but not limited to the Executive’s obligations
under Sections 1.5, 1.6, 1.7, 1.8, 1.9 1.10 and 3.1 of the Employment
Agreement and the Company’s obligations under Section 1.3(g) of the Employment
Agreement. Notwithstanding anything to the contrary in the Employment Agreement,
the parties agree that (i) for purposes of Sections 1.8 and 2.1 of the
Employment Agreement, the definition of “Business”
shall
be limited to the licensing- businesses of Iconix and Cherokee only; (ii)
Section 1.8(a) of the Employment Agreement shall not preclude Executive from
participating in or otherwise being employed by or providing services to any
Person that purchases the Company’s licensing business or other successor to the
Company; (iii) in the event Executive participates in or otherwise is employed
by or provides services to any Person that purchases the Company’s licensing
business or is a successor to the Company, Section 1.5 of the Employment
Agreement shall not preclude Executive from using or disclosing any Confidential
Information or Third Party Information to the extent such disclosure or use
is
consistent with Executive’s service with such purchaser or other successor; and
(iv) Section 1.3(g) of the Employment Agreement shall survive and continue
in
full force in accordance with its terms as though Executive continued to be
an
executive officer of the Company, notwithstanding Executive’s termination of
employment with, and service as an officer of, the Company on the Termination
Date.
| 7. |
Validity.
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Whenever
possible, each provision of this Agreement shall be interpreted in such manner
as to be effective and valid under applicable law, but if any provision of
this
Agreement is held to be invalid, illegal or unenforceable in any respect under
any applicable law or rule in any jurisdiction, such invalidity, illegality
or
unenforceability shall not affect any other provision or any other jurisdiction,
but this Agreement shall be reformed, construed and enforced in such
jurisdiction as if such invalid, illegal or unenforceable provision had never
been contained herein.
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| 8. |
Successors
and Assigns
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This
Agreement shall inure to and be binding upon the parties hereto and to their
respective heirs, legal representatives, successors, and assigns.
| 9. |
Governing
Law
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This
Agreement shall be construed in accordance with the laws of the state of New
York and any applicable federal laws.
| 10. |
Special
Notification
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Because
this Agreement includes a waiver and release of claims arising under the Age
Discrimination in Employment Act, federal law provides that Executive may have
twenty-one (21) days from receipt of the Agreement to review and consider this
Agreement before executing it. Federal law also provides that the Employer
must
advise Executive to consult with an attorney before signing this Agreement.
Executive understands that it is Executive’s decision whether or not to consult
an attorney.
Pursuant
to federal law, Executive is further advised that the release and covenant
not
to xxx contained herein do not apply to claims that arise after the execution
of
this Agreement. Executive further understands and agrees that Executive is
receiving additional consideration that Executive would not be entitled to
receive under the Employment Agreement, any Company policy, practice or plan
of
if Executive did not execute this Agreement which includes the waiver and
release of claims under the Age Discrimination in Employment Act.
Executive
represents and warrants that he has had ample opportunity to consider this
Agreement and has had an opportunity to consult an attorney before executing
this Agreement.
| 11. |
Revocation
of Agreement
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Federal
law also provides that, because this Agreement waives and releases claims
arising under the Age Discrimination in Employment Act, that Executive may
revoke this Agreement within seven (7) days after Executive executes it. For
this revocation to be effective, written notice must be received by Xxx
Xxx, General Counsel,
no
later than the close of business on the seventh day after Executive has executed
this Agreement. If Executive revokes the Agreement, it will not be effective
or
enforceable, and Executive will not receive the payments described in Paragraph
1 (other
than the payments and benefits in subparagraphs 1.a and 1.f).
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| 12. |
Acknowledgement.
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BY
SIGNING THIS AGREEMENT, EXECUTIVE REPRESENTS AND AGREES THAT:
(a) EXECUTIVE
HAS READ IT CAREFULLY;
(b) EXECUTIVE
UNDERSTANDS ALL OF ITS TERMS AND KNOWS THAT HE IS GIVING UP IMPORTANT RIGHTS,
INCLUDING BUT NOT LIMITED TO, RIGHTS UNDER THE AGE DISCRIMINATION IN EMPLOYMENT
ACT OF 1967, AS AMENDED, TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, AS AMENDED;
THE EQUAL PAY ACT OF 1963, THE AMERICANS WITH DISABILITIES ACT OF 1990; AND
THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED;
(c) EXECUTIVE
VOLUNTARILY CONSENTS TO EVERYTHING IN THE AGREEMENT;
(d) EXECUTIVE
HAS BEEN ADVISED TO CONSULT WITH AN ATTORNEY (VIA THIS AGREEMENT) BEFORE
EXECUTING IT AND EXECUTIVE HAS DONE SO OR, AFTER CAREFUL READING AND
CONSIDERATION, EXECUTIVE HAS CHOSEN NOT TO DO SO OF HIS OWN VOLITION;
(e) EXECUTIVE
HAS HAD AT LEAST 21 DAYS FROM THE DATE OF HIS RECEIPT OF THE LANGUAGE OF THE
GENERAL RELEASE SUBSTANTIALLY IN ITS FINAL FORM ON DECEMBER 11, 2006 TO CONSIDER
IT; AND THE CHANGES MADE SINCE THE DECEMBER 11, 2006 VERSION OF THE GENERAL
RELEASE ARE NOT MATERIAL AND WILL NOT RESTART THE REQUIRED 21-DAY PERIOD;
(f) THE
CHANGES TO THE LANGUAGE OF THE GENERAL RELEASE SINCE DECEMBER 11, 2006 EITHER
ARE NOT MATERIAL OR WERE MADE AT HIS REQUEST.
(g) EXECUTIVE
HAS SIGNED THIS AGREEMENT KNOWINGLY AND VOLUNTARILY AND WITH THE ADVICE OF
ANY
COUNSEL RETAINED TO ADVISE HIM WITH RESPECT TO IT; AND
(h) EXECUTIVE
AGREES THAT THE PROVISIONS OF THIS AGREEMENT MAY NOT BE AMENDED, WAIVED, CHANGED
OR MODIFIED EXCEPT BY AN INSTRUMENT IN WRITING SIGNED BY AN AUTHORIZED
REPRESENTATIVE OF THE
COMPANY
AND BY
EXECUTIVE.
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IN
WITNESS WHEREOF, the Parties have executed this Agreement as of the date
indicated below.
/s/
Xxxxxxx X.
Xxxx
XXXXXXX
X. XXXX
Date: June
20,
2008
By:
/s/
Xxxxxxx X.
Xxxx
Name: Xxxxxxx
X. Xxxx
Title:
Chief Financial Officer
Date:
June 26, 2008
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