RESIGNATION AGREEMENT AND GENERAL RELEASE
This Resignation Agreement and General Release ("Agreement") is entered
into between Heska Corporation ("EMPLOYER") and Xxxxxx Xxxxxxxx ("EMPLOYEE").
EMPLOYER and EMPLOYEE may be referred to in this Agreement together as the
"Parties," or individually as a "Party." For purposes of this Agreement,
EMPLOYER includes any company related to EMPLOYER, in the past or present; the
past and present officers, directors, employees, shareholders, investors,
attorneys, agents and representatives of the EMPLOYER; any present or past
employee benefit plan sponsored by EMPLOYER and/or the officers, directors,
trustees, administrators, employees, attorneys, agents and representatives of
such plan; and any person who acted on behalf of EMPLOYER or on instruction from
EMPLOYER.
In exchange for the releases and other agreements specified in this
Agreement, the Parties agree as follows:
A. EMPLOYEE'S RESIGNATION. EMPLOYEE resigned as an employee of EMPLOYER
effective May 31, 2002 (the "Resignation Date"). EMPLOYEE will not apply
for or otherwise seek or accept future employment or reinstatement with
EMPLOYER. Even though EMPLOYER will pay EMPLOYEE to settle and release
any claims, EMPLOYER does not admit that it is legally obligated to
EMPLOYEE and EMPLOYER denies that it is responsible or legally obligated
for any claims or that it has engaged in any improper conduct or
wrongdoing against EMPLOYEE.
B. EMPLOYEE'S CONTINUING OBLIGATION TO PRESERVE EMPLOYER'S CONFIDENTIAL
INFORMATION. EMPLOYEE acknowledges that he has entered into a Non-
Disclosure Agreement with EMPLOYER (the "Confidentiality Agreement") and
that by reason of his position with EMPLOYER he has been given access to
confidential information with respect to the business affairs of
EMPLOYER. [Examples include any trade secrets, manufacturing plans, new
product information, customer lists, etc.] EMPLOYEE represents that he
has held all such information confidential and will continue to do so in
accordance with his obligations under the Confidentiality Agreement and
will not engage in any conduct or activity reasonably related to his
employment with the EMPLOYER which is likely to have an adverse effect on
the operations of the EMPLOYER. EMPLOYEE further agrees that he will not
disclose, or cause to be disclosed in any way, any confidential
information or documents obtained as a result of or in connection with
his employment with EMPLOYER to any third person, without the express,
written consent of EMPLOYER.
C. SETTLEMENT CONSIDERATION FOR EMPLOYEE. EMPLOYER has paid EMPLOYEE all
employment compensation and has provided EMPLOYEE with all benefits to
which EMPLOYEE is entitled through and including the Resignation Date,
with the exception of EMPLOYEE's paycheck for the period ending May 31,
2002 and a Management Incentive Bonus due to EMPLOYEE in the amount of
$45,264. The parties agree that EMPLOYER shall pay EMPLOYEE his paycheck
for the period ending May 31, 2002 and the Management Incentive Bonus in
the amount of $45,264.00 on May 31, 2002. EMPLOYER will make the
following additional payments to EMPLOYEE and will provide EMPLOYEE with
the benefits and consideration set forth herein in exchange for
EMPLOYEE'S release of EMPLOYER and in settlement of any claim or claims
EMPLOYEE may have against EMPLOYER.
1. SETTLEMENT PAYMENT. As consideration for EMPLOYEE'S release of all
claims against EMPLOYER, EMPLOYER will pay EMPLOYEE twelve months
base salary at the rate in effect immediately prior to the
Resignation Date in twelve equal monthly installments (subject to
all applicable taxes and other deductions), with the first such
installment due 30 days after the Resignation Date and with the
following eleven installments due no later than monthly thereafter
on EMPLOYER'S then regular payroll dates. Payment will be in the
form of an EMPLOYER'S check to EMPLOYEE which will be mailed to him
at his residence address or direct deposited in EMPLOYEE's personal
bank account, in accordance with EMPLOYER'S regular payroll
practices.
2. MEDICAL AND DENTAL PAYMENTS. Provided that EMPLOYEE timely elects
continuation coverage under the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended ("COBRA"), EMPLOYER shall
pay, on his behalf, the portion of premiums of EMPLOYEE'S group
health insurance, including coverage for EMPLOYEE'S eligible
dependents, that EMPLOYER paid prior to EMPLOYEE'S termination of
employment with Heska. EMPLOYER will pay such premiums for
EMPLOYEE'S eligible dependents only for coverage for which those
dependents were enrolled immediately prior to EMPLOYEE'S termination
of employment. EMPLOYEE will continue to be required to pay that
portion of the premium of his health coverage, including coverage
for his eligible dependents, that he was required to pay as an
active employee immediately prior to his termination
of employment. EMPLOYEE is eligible for twelve (12) months of such
premium payments beginning June 1, 2002 through May 31, 2003.
For the balance of the period that EMPLOYEE is entitled to coverage
under COBRA, EMPLOYEE shall be entitled to maintain coverage for
himself and his eligible dependents at his own expense.
3. CAREER TRANSITION. Within three (3) business days of the Effective
Date, EMPLOYER will provide a check for $2,000.00 payable to
EMPLOYEE after the Resignation Date that may be used for
professional career transition purposes.
4. VESTING/EXPIRATION OF STOCK OPTIONS/RESTRICTED STOCK. The vesting
schedule for stock options currently vested and exercisable as of
the Resignation Date will remain unchanged and no shares will
continue to vest following the Resignation Date. However, effective
as of the Resignation Date, EMPLOYEE shall be entitled to
acceleration of an additional one year's vesting from the
Resignation Date. In addition, the exercise period following the
Resignation Date in which all vested options must be exercised will
be extended from three months to twelve months. EMPLOYEE
understands that if he exercises such vested options after the 90th
day following his Resignation Date, any option that was originally
intended to qualify as an ISO, or incentive stock option, will be
converted to an NSO, or nonstatutory stock option.
The vesting schedule for EMPLOYEE'S restricted stock which is vested
as of the Resignation Date will remain unchanged and no shares will
continue to vest following the Resignation Date. However, effective
as of the Resignation Date, EMPLOYER agrees to waive its repurchase
right and permit the acceleration of an additional one year's
vesting of such restricted shares. The value of the one year's
worth of accelerated shares will be set as of the closing bid price
of the EMPLOYER'S common stock on the Resignation Date. EMPLOYEE
will be solely liable for any tax liability assessed in connection
with the accelerated shares. EMPLOYER also hereby notifies EMPLOYEE
of its intention to repurchase from EMPLOYEE all unvested restricted
shares at a price of $0.001 per share which shall be paid to
EMPLOYEE prior to the 120th day following the Resignation Date.
Other than as specifically set forth herein, all other terms of
EMPLOYER'S 1997 Stock Incentive Plan and the individual stock
agreements entered into between EMPLOYEE and EMPLOYER (collectively
the "Stock Agreements") shall apply to such stock options and
restricted stock.
5. EMPLOYMENT AGREEMENT. EMPLOYEE acknowledges that this Agreement
supercedes and replaces EMPLOYER'S obligations to pay severance
pursuant to the Employment Agreement dated December 1, 1998 entered
into between the parties.
(a) Such payment as set forth herein shall be treated by
EMPLOYER as income to EMPLOYEE from which ordinary federal and state
withholding and taxes shall be deducted. Furthermore,
notwithstanding the Mutual Release as set forth in Section E,
EMPLOYEE will indemnify and hold EMPLOYER harmless from any costs,
liability or expense, including reasonable attorney's fees, arising
from the taxation, if any of any amounts received by EMPLOYEE
pursuant to this Agreement, including but not limited to any
penalties, administrative expenses, or any claim for any loss, cost,
damage, or expense arising out of any dispute over the non-
withholding, or other tax treatment or any of the consideration,
stock and stock options received by EMPLOYEE as a result of this
Agreement. EMPLOYEE represents that he has sought independent
advice on the possible tax treatment of the consideration paid
pursuant to this Agreement and is not relying on any representations
by EMPLOYER as to any potential tax consequences or liabilities that
may be owed by EMPLOYEE under this Agreement.
D. RETURN OF COMPANY PROPERTY. EMPLOYEE represents that to the best of his
knowledge he has returned all of EMPLOYER'S property including, but not
limited to, EMPLOYER confidential and proprietary documents, materials,
keys, credit cards, laptops, computer disks and badges. EMPLOYER
represents that it is not aware of any Company property that has been
retained by EMPLOYEE.
E. MUTUAL RELEASE.
1. GENERAL RELEASE. EMPLOYEE agrees that the consideration stated
herein represents settlement in full of all outstanding obligations
owed to EMPLOYEE by EMPLOYER. EMPLOYEE understands this Agreement
is a knowing and voluntary waiver of claims by EMPLOYEE related to
his employment with and separation from EMPLOYER. In exchange for
the consideration set forth in this Agreement, and except for
matters specifically provided in this Agreement, the parties, on
behalf of themselves, their representatives, successors and assigns,
release, and forever discharge each other from any and all claims,
demands, damages, losses, obligations, rights and causes of action,
whether known or unknown, including but not limited to, all claims,
causes of action or administrative complaints that each now has or
has ever had against each other relating in any way to EMPLOYEE'S
employment with EMPLOYER. The parties agree not to bring any
lawsuits against each other relating to the claims that each has
released nor will either party allow any to be brought or continued
on the party's behalf or in the party's name (the "RELEASED
CLAIMS").
The RELEASED CLAIMS include but are not limited to those which arise
out of, relate to, or are based upon: (i) EMPLOYEE'S employment with
EMPLOYER or the termination thereof, (ii) statements, acts or
omissions by EMPLOYER whether in its individual or representative
capacities, (iii) express or implied agreements between the Parties,
(iv) any and all claims relating to or arising from EMPLOYEE'S right
to purchase or actual purchase of shares of stock of EMPLOYER
including without limitation any claims for fraud,
misrepresentation, breach of fiduciary duty, breach of duty under
applicable state corporate law, and securities fraud under any state
or federal law, provided however that the parties reserve their
rights to indemnification as set forth in Section C5(a) and E(4),
respectively; and (v) all state and federal statutes, including but
not limited to claims based on race, sex, disability, age, or any
other characteristic of EMPLOYEE under the Americans with
Disabilities Act, the Older Worker's Benefit Protection Act, the
Fair Labor Standards Act, the Equal Pay Act, Title VII of the Civil
Rights Act of 1964 (as amended), the Civil Rights Act of 1991, the
Civil Rights Acts of 1866 and 1871, the Family and Medical Leave
Act, the National Labor Relations Act, the Occupational Safety and
Health Act, the Rehabilitation Act, Executive Order 11246, the
Colorado Labor Peace Act, the Colorado Wage Claim Act, the
Employee's Retirement Income Security Act of 1974, the
Rehabilitation Act of 1973, and/or the Worker Adjustment and
Retraining Notification Act, and all federal and common law. The
RELEASED CLAIMS include, but are not limited to, claims related to
the negotiation and execution of this Agreement, including but not
limited to claims that this Agreement was fraudulently induced.
Notwithstanding the foregoing, EMPLOYER specifically reserves any
claim or cause of action it may have against EMPLOYEE based upon
intentional unlawful conduct. EMPLOYER represents that as of the
date of its execution of this Agreement, it is not aware of any act
or omission of EMPLOYEE that constitutes intentional unlawful
conduct.
2. EMPLOYEE'S SPECIFIC ADEA RELEASE OF EMPLOYER. EMPLOYEE acknowledges
and agrees that by entering into this Agreement he is waiving any
and all rights that he may have arising from the Age Discrimination
in Employment Act of 1967 ("ADEA"), as amended, which have arisen on
or before the date of execution of this Agreement. EMPLOYEE further
expressly acknowledges and agrees that:
a. EMPLOYEE is entering this Agreement voluntarily.
b. EMPLOYEE understands and agrees that, by signing the Agreement,
he is giving up any right to file legal proceedings against the
EMPLOYER arising before the date of the Agreement. EMPLOYEE is
not waiving (or giving up) rights or claims that may arise after
the date the Agreement is executed.
c. In return for this Agreement, EMPLOYEE will receive compensation
due him as a result of this Resignation Agreement and General
Release.
d. EMPLOYEE is hereby advised in writing by this Agreement to
consult with an attorney before signing this Agreement.
e. EMPLOYEE understands that he has at least twenty-one (21) days
from the day he received this Agreement, not counting the day
upon which he received it, to consider whether he wishes to sign
this Agreement. If he cannot make up his mind in that period of
time, EMPLOYER may or may not allow more time. EMPLOYEE further
acknowledges that if he signs this Agreement before the end of
the twenty-one (21) day period, it will be his personal,
voluntary decision to do so and he has not been pressured to make
a decision sooner.
f. Nothing in this Agreement prevents or precludes EMPLOYEE from
challenging or seeking a determination in good faith of the
validity of this waiver under the ADEA, nor does it impose any
condition precedent, penalties or costs from doing so, unless
specifically authorized by federal law.
g. RIGHT TO RESCIND. EMPLOYEE further understands that he may
rescind (that is, cancel) this Agreement for any reason within
seven (7) calendar days after signing it. EMPLOYEE agrees that
the rescission must be in writing and hand-delivered or mailed to
EMPLOYER. If mailed, the rescission must be postmarked within
the seven (7) day period, properly addressed to:
HESKA CORPORATION
ATTN: XXXX XXXXXXXXX
VP, HUMAN RESOURCES
0000 XXXXXXXX XXXXXXX
XXXX XXXXXXX, XX 00000
and sent by certified mail, return receipt requested.
EMPLOYEE understands that he will not receive any settlement
payment under this Agreement if he revokes or rescinds it, and in
any event, EMPLOYEE will not receive any settlement until after
the seven (7) day revocation period has expired.
3. UNKNOWN FACTS. This Agreement includes claims of every nature and
kind, known or unknown, suspected or unsuspected. The parties
hereby acknowledge that they may hereafter discover facts different
from, or in addition to, those which they now know to be or believe
to be true with respect to this Agreement, and they agree that this
Agreement and the release contained herein shall be and remain
effective in all respects, notwithstanding such different or
additional facts or the discovery thereof.
4. INDEMNIFICATION. Notwithstanding anything in this Agreement to the
contrary, EMPLOYER acknowledges and agrees to fulfill any
indemnification and defense obligations it may have to EMPLOYEE, by
virtue of his status as an executive officer of EMPLOYER, for acts
committed within the scope of his employment by EMPLOYER, to the
same extent as its obligations to indemnify and defend EMPLOYER's
other executive officers.
F. CONFIDENTIALITY OF AGREEMENT. EMPLOYEE agrees to keep this Agreement
confidential and will not communicate the terms of this Agreement, the
facts or circumstances giving rise to this Agreement, or the fact that
such Agreement exists, to any third party except, as necessary, his
immediate family, accountants, legal or financial advisors or otherwise
appropriate or necessary as required by law or court order.
G. NO COOPERATION. EMPLOYEE agrees that he will not act in any manner that
might damage the business of EMPLOYER. EMPLOYEE agrees that he will not
encourage, counsel or assist any attorneys or their clients in the
presentation or prosecution of any disputes, differences, grievances,
claims, charges, or complaints by any third party against any of the
Releasees, unless under a subpoena or other court order to do so.
EMPLOYEE shall inform EMPLOYER in writing within three (3) days of
receiving any such subpoena or other court order.
H. NON-DISPARAGMENT. The parties agree to refrain from any
defamation, libel or slander of each other, and any tortious interference
with contracts, relationships, and prospective economic advantage.
EMPLOYEE agrees not to disparage or otherwise make negative statements or
comments about or relating to EMPLOYER. Xxxx Xxxxxxxxx and Xxxxxx Xxxxxx
agree not to disparage or otherwise make negative statements or comments
about or relating to EMPLOYEE and the parties agree that all inquiries
regarding EMPLOYEE's employment with EMPLOYER shall be directed to either
Xx. Xxxxxxxxx or Xx. Xxxxxx and the information released in connection
with such inquiries shall be limited to EMPLOYEE'S dates of employment
and job responsibilities held.
I. NO PENDING OR FUTURE LAWSUITS. EMPLOYEE represents that he has no
lawsuits, claims, or actions pending in his name, or on behalf of any
other person or entity, against the Company or any other person or entity
referred to herein. EMPLOYEE also represents that he does not intend to
bring any claims on his own behalf or on behalf of any other person or
entity against EMPLOYER or any other person referred to herein.
J. ENFORCEMENT. This Agreement does not release any claims for enforcement
of the terms, conditions or warranties contained herein. The Parties
shall be free to pursue any remedies available to them to enforce this
Agreement subject to paragraphs L and M.
K. SEVERABILITY. If any provision of this Agreement is declared by any
court of competent jurisdiction to be invalid for any reason, such
invalidity shall not affect the remaining provisions of this Agreement,
which shall be fully severable, and given full force and effect.
L. GOVERNING LAW AND JURISDICTION. This Agreement shall be construed in
accordance with the laws of Colorado, without regard to its conflicts of
law provisions. The Parties both consent to personal jurisdiction in
Colorado.
M. ARBITRATION. Unless prohibited by statutory or common law and except as
provided below, any and all disputes arising under or related to this
Agreement which cannot be resolved through negotiations between the
Parties shall be submitted to binding arbitration. If the Parties fail
to reach a settlement of their dispute within fifteen (15) days after the
date upon which one of the Parties notified the other(s) of its desire to
resolve the dispute, then the dispute shall be promptly submitted to
final and binding arbitration to be conducted privately and
confidentially by a single arbitrator who is a member of the panel of
former judges that makes up the Judicial Arbiter Group ("JAG"), any
successor of JAG, or, if JAG or any successor is not in existence, any
entity that can provide a former judge to serve as arbitrator. The
decision of the arbiter shall be final, non-appealable and binding upon
the Parties and may be entered in any court of competent jurisdiction.
Unless otherwise agreed by the Parties, the arbitration shall take place
in Denver, Colorado. The arbitrator shall be bound by the laws of the
State of Colorado applicable to the issues involved in the arbitration
and all Colorado rules relating to the admissibility of evidence,
including, without limitation, all relevant privileges and the attorney
work product doctrine. The arbitrator shall have the power to grant
equitable relief where applicable under Colorado law. Notwithstanding
the foregoing, either party may seek and obtain an injunction or other
appropriate relief from a court to preserve or protect the status quo
with respect to any matter pending conclusion of the arbitration
proceeding, but no such application to a court shall in any way be
permitted to stay or otherwise impede the progress of the arbitration
proceeding. The Parties agree that the prevailing party in any dispute
arising under or related to this Agreement, including any dispute that is
submitted to arbitration pursuant to this Section, shall be entitled to
an award of his or its costs and expenses incurred in such dispute,
including his or its reasonable attorney's fees, in addition to any other
relief to which the party may be entitled.
N. ENTIRE AGREEMENT. This Agreement represents the entire agreement and
understanding between EMPLOYER and EMPLOYEE concerning EMPLOYEE'S
employment with and separation from EMPLOYER and the events leading
thereto and associated therewith, and supersedes and replaces any and all
prior agreements and understandings concerning EMPLOYEE'S relationship
with EMPLOYER, with the exception of the Confidentiality Agreement, the
EMPLOYER'S Stock Plan and any applicable Stock Option Agreement between
EMPLOYER and EMPLOYEE.
O. NO REPRESENTATIONS. Each party represents that it has had the
opportunity to consult with an attorney, and has carefully read and
understands the scope and effect of the provisions of this Agreement.
Neither party has relied upon any representations or statements made by
the other party hereto which are not specifically set forth in this
Agreement.
P. NO ORAL MODIFICATION. Any modification or amendment of this Agreement,
or additional obligation assumed by either party in connection with this
Agreement, shall be effective only if placed in writing and signed by
both Parties. No provision of this Agreement can be changed, altered,
modified, or waived except by an executed writing by both Parties.
Q. EFFECTIVE DATE. The effective date of this Agreement shall be the eighth
day after EMPLOYEE signs and returns this Agreement to EMPLOYER so long
as he does not exercise his right to rescind this Agreement as set forth
in Section E(2)(g).
CAUTION; PLEASE READ ENTIRE DOCUMENT BEFORE SIGNING
SIGNED:
Heska Corporation Employee
By: /s/ Xxxxxx X. Xxxxxx By: /s/Xxxxxx X. Xxxxxxxx
------------------------------- -------------------------------
Typed Name: Xxxxxx X. Xxxxxx Typed Name: Xxxxxx Xxxxxxxx
Title: Chairman of the Board and CEO Title: ___________________________
Date: June 5, 2002 SS#: ###-##-####
---------------------------
Date: May 29, 2002
----------------------------
By: /s/Xxxx Xxxxxxxxx
---------------------------------
Typed Name: Xxxx Xxxxxxxxx
Title: Vice President, Human Resources
Date: May 29, 2002
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