EXHIBIT 99.2
TERMINATION AGREEMENT AND GENERAL RELEASE
Agreement entered into as of the 1st day of October, 2004 between XXXXXXX
XXXXXX, an individual ("Xxxxxx" or "Employee"), and JAKKS PACIFIC, INC., a
Delaware corporation (the "Company"). The Company and Xxxxxx may also be
referred to as a "Party" or the "Parties".
FOR GOOD AND VALUABLE CONSIDERATION, receipt of which is hereby
acknowledged, the Parties hereby agree as follows:
1. SEPARATION. This will confirm that effective as of September 30, 2004
(the "Termination Date") the Amended and Restated Employment Agreement dated
March 26, 2003 and as of January 1, 2003 between the Parties hereto (the
"Employment Agreement") is hereby terminated. The vesting of the 96,000 shares
of restricted shares of stock of the Company granted to Xxxxxx on January 1,
2004 pursuant to the Company's 2002 Stock Award and Incentive Plan and the
Restricted Stock Agreement between Xxxxxx and the Company dated January 1, 2004
shall be controlled by the terms of the Consulting Agreement (as defined below).
Xxxxxx hereby resigns as an officer of the Company as of the Effective Date. The
Company and Xxxxxx each acknowledges that no amounts are due either from the
Company to Xxxxxx or from Xxxxxx to the Company with respect to any indebtedness
of the Company to Xxxxxx or Xxxxxx to the Company, and that the Company does not
owe Xxxxxx any compensation, bonuses, severance, commissions, vacation pay,
profit participation or any other form of compensation currently due to him or
contingently due to him pursuant to the terms of the Employment Agreement,
interest or principal on any loans or other payments of any kind whatsoever and
Xxxxxx does not owe the Company any payment of any kind whatsoever. Xxxxxx
agrees that all 222,279 unexercised stock options to acquire shares of stock of
the Company granted to him to date are hereby cancelled, even if already vested.
Xxxxxx hereby confirms that he has not exercised any stock options since August,
2001 and that any requests for exercise subsequent to such date are hereby
rescinded and shall be deemed null and void. Xxxxxx also acknowledges that by
virtue of the termination of the Employment Agreement, he is hereby forfeiting
any claim to the restricted stock awards of 96,000 shares, which he was to be
granted on each of January 1, 2005, 2006 and 2007 and that the continued right
to, and vesting schedule of, the 96,000 shares he was granted on January 1, 2004
shall now be controlled exclusively by the terms of the Consulting Agreement.
The provisions of Sections 9, 10, and 22 of the Employment Agreement shall
survive its termination.
2. ACCEPTANCE AND REVOCATION. Employee may accept, reject and /or revoke
this Agreement as follows:
(i) Employee shall have up to twenty-one (21) days from the date
of Employee's initial receipt of this Agreement to consider its terms and
conditions, and may accept this Agreement at any time within that period.
Employee may accept this Agreement by signing and dating it before a notary
public, and then returning it to Xxxxxxx X. Xxxxxx, the Company's President, so
that it is received no later than 5:00 o'clock p.m. on the twenty-first (21st)
day after Employee's initial receipt of this Agreement.
(ii) After signing this Agreement, Employee shall have seven (7)
days (hereinafter referred to as the "Revocation Period") during which Employee
may revoke this Agreement, but only if Employee does so in writing (i) addressed
to Xxxxxxx X. Xxxxxx,
President of the Company, and (ii) received no later than 5:00 o'clock p.m. on
the seventh (7th) day following the date Employee signs this Agreement. If
Employee does not revoke this Agreement during the Revocation Period, then this
Agreement shall be effective on the eighth (8th) day following Employee's
signing of the Agreement (hereinafter referred to as the "Effective Date").
(iii) If Employee does not accept this Agreement as set forth
above, or if Employee revokes this Agreement during the Revocation Period, then
this Agreement shall automatically be deemed null and void, and then Company
shall be entitled to recover any consideration that may have been paid to and/or
on behalf of Employee following the Termination Date pursuant hereto or to the
Consulting Agreement.
3. EMPLOYEE'S RELEASE. Xxxxxx, for himself and his heirs, executors,
administrators, successors and assigns, hereby does release and forever
discharge the Company, and its officers, directors, trustees, stockholders,
affiliates, employees, attorneys, advisors, successors, and assigns, and the
heirs, executors, administrators, successors, and assigns of all of the
foregoing from any and all claims, demands, causes of action, actions, suits,
promises, damages, liabilities, and judgments whatsoever, whether known or
unknown, in law or equity, which Xxxxxx, his heirs, executors, administrators,
successors and assigns ever had, now have, or hereafter can, shall, or may have
for, upon, or by reason of any matter, cause or thing whatsoever, arising from
the Employment Agreement, including, but not limited to, any and all claims for
damages, attorneys' fees, or costs under Title VII of the Civil Rights Act of
1964, as amended, 42 U.S.C. Section 2000e et seq.; the Age Discrimination In
Employment Act of 1967, and the Older Workers Benefit Protection Act, as
amended, 29 U.S.C. Section 621 et seq.; the Civil Rights Act of 1991, 42 U.S.C.
Section 1981(a) et seq.; the Americans with Disabilities Act, 42 U.S.C. Section
12101 et seq.; the Fair Labor Standards Act, 29 U.S.C. Sections 201219; the
Family and Medical Leave Act, 29 U.S.C. Section 2601 et. seq.; the Employee
Retirement Income Security Act of 1974, as amended; the Civil Rights Acts of
1866 and 1871; the Equal Pay Act; the National Labor Relations Act; the Fair
Labor Standards Act; the Conscientious Employee Protection Act; the United
States Constitution; the Constitutions of the States of New York and California,
or of any other state or country; all federal, state, or municipal statutes or
ordinances, including but not limited to any laws, rules or regulations of the
State or City of New York and the State of California, including the New York
State Human Rights Law, the New York State Labor Law and the New York City Human
Rights Law; the California Fair Employment and Housing Act ("FEHA") and Gov't
Section 12945; the California Labor Code; the California Penal Code; the
California Constitution and any contract, tort, or common law theories with
respect to Xxxxxx'x hiring by the Company, the terms and conditions of his
employment with the Company, and the termination of his employment with the
Company. Notwithstanding the choice of law under this Agreement as New York, the
Parties agree that if California law shall apply in any respect to this
Agreement, Xxxxxx further understands that he agrees to waive, and by his
signature below does in fact waive, all rights or benefits under the terms of
Section 1542 of the California Civil Code ("Section 1542"). Section 1542 reads
as follows:
"A general release does not extend to claims which the creditor does not
know or suspect to exist in his favor at the time of executing the
release, which if known by him must have materially affected his
settlement with the debtor."
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Notwithstanding the provisions of Section 1542, and for the purpose of
implementing a full and complete release and discharge of all claims, Xxxxxx
expressly acknowledges that this Termination Agreement and General Release is
intended to include in its effect, without limitation, all claims which Xxxxxx
does not know or suspect to exist in his favor at the time of his execution of
this Agreement, and that this Agreement contemplates the extinguishment of such
claims. The Release in this Section does not in any way affect the rights of
either Party to take whatever steps may be necessary to enforce the terms of
this Agreement or the terms of the Consulting Agreement of even date herewith
between the Parties hereto (the "Consulting Agreement"), or to obtain
appropriate relief in the event of any breach of the terms of this Agreement or
the Consulting Agreement.
4. COMPANY'S RELEASE. The Company, and its officers, directors,
trustees, stockholders, affiliates, employees, attorneys, advisors, successors,
and assigns, and the heirs, executors, administrators, successors, and assigns
of all of the foregoing, in consideration of the release given by Xxxxxx in this
Agreement, hereby does release and forever discharge Xxxxxx and his heirs,
executors, administrators, successors and assigns from any and all claims,
demands, causes of action, actions, suits, promises, damages, liabilities, and
judgments whatsoever, whether known or unknown, in law or equity, which the
Company, and its officers, directors, trustees, stockholders, affiliates,
employees, agents, attorneys, advisors, successors, and assigns, and the heirs,
executors, administrators, successors, and assigns of all of the foregoing ever
had, now have, or hereafter can, shall, or may have for, upon, or by reason of
any matter, cause or thing whatsoever arising from the Employment Agreement,
including, but not limited to, any and all claims for damages, attorneys' fees,
or costs under any state or federal statute, constitution, or regulation, or any
contract, tort, or common law theories with respect to Xxxxxx'x hiring by the
Company, the terms and conditions of his employment by the Company, and the
termination of his employment by the Company. Notwithstanding the choice of law
under this Agreement as New York, the Parties agree that if California law shall
apply in any respect to this Agreement, the Company further understands that it
agrees to waive, and by the signature of its duly authorized signatory below
does in fact waive, all rights or benefits under the terms of Section 1542 of
the California Civil Code. Section 1542 reads as follows:
"A general release does not extend to claims which the creditor does not
know or suspect to exist in his favor at the time of executing the
release, which if known by him must have materially affected his
settlement with the debtor."
Notwithstanding the provisions of Section 1542, and for the purpose of
implementing a full and complete release and discharge of all claims, the
Company expressly acknowledges that this Termination Agreement and General
Release is intended to include in its effect, without limitation, all claims
which the Company does not know or suspect to exist in its favor at the time of
its execution of this Agreement, and that this Agreement contemplates the
extinguishment of such claims. The Release in this Section does not in any way
affect the rights of either Party to take whatever steps may be necessary to
enforce the obligations of the other Party under the terms of this Agreement or
the Consulting Agreement or to obtain appropriate relief in the event of any
breach of the terms of this Agreement or the Consulting Agreement.
5. ACKNOWLEDGEMENTS. Xxxxxx acknowledges that he: (a) has carefully read
this Agreement, (b) has had an opportunity to review this Agreement with an
attorney of his choice,
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(c) understands all of the terms of this Agreement, (d) has not relied upon any
representation or statement, written or oral, not set forth in this Agreement,
and (e) has knowingly and voluntarily executed this Agreement.
6. AFFIRMATIONS. Employee affirms that Employee has not filed, caused to
be filed, and presently is not a party to any claim, complaint, or action
against any of the Releasees in any forum or form. Employee furthermore affirms
that Employee has no known workplace injuries or occupational diseases and has
been provided and/or has not been denied any leave requested under the Family
and Medical Leave Act and/or any other federal, state or local leave law.
Employee further affirms that in the course of his performance under the
Employment Agreement, Employee has not become aware of any fraudulent activity
or any act(s) which would form the basis of a claim of fraudulent or illegal
activity of Employer and has not complained of any such activity or act(s);
provided, however, Employee has not conducted any investigation for the purpose
of ascertaining the existence of such activity or act(s).
7. GOVERNING LAW AND INTERPRETATION. This Agreement, which serves to
terminate the Employment Agreement which was governed by New York law, shall be
governed by, and interpreted and enforced in accordance with, the internal laws
of the State of New York without regard to its conflict of laws or choice of law
provisions.
8. REMEDIES. All remedies hereunder are cumulative and not exclusive and
nothing herein shall be deemed to prohibit or limit either Party from pursuing
any other remedy or relief available at law or in equity for any actual or
prospective breach or default, including the recovery of damages.
9. RETURN OF PROPERTY. Employee agrees, within seven (7) calendar days
from the date of this Agreement, to return any and all property, including all
copies or duplicates thereof, belonging to the Company (and any of its
affiliates or subsidiaries), including, but not limited to keys, security cards,
equipment (other than home computer equipment), documents, supplies, customer
lists and customer information, confidential documents, and other Confidential
Information(as such term is defined in the Employment Agreement) of the Company;
provided, however, Employee may retain the cellular telephone and home computer
equipment issued to him through the Company, provided that Employee provides
reasonably satisfactory evidence to the Company that any Confidential
Information of the Company and all other information belonging to the Company
has been deleted from the computer's memory and provided to the Company.
10. ARBITRATION; VENUE. Any dispute or issue arising under this
Agreement shall be resolved by arbitration before a panel of three (3)
arbitrators in accordance with the commercial arbitration rules of the American
Arbitration Association, at a hearing or hearings conducted in New York, New
York. The decision of the arbitrators shall be in writing, and shall be final
and binding on each of the parties hereto and be enforceable by entry as a
judgment in any court of competent jurisdiction. The parties hereto agree that
each may seek injunctive relief to which it may be entitled under the provisions
of this Agreement from the arbitrators or from a court located in New York, New
York, and each Party to this Agreement submits to the exclusive jurisdiction of
the courts of the State of New York, located in New York County, New York, and
to the jurisdiction of the United States District Court for the Southern
District of Xxx Xxxx, Xxx Xxxx, Xxx Xxxx, Xxxxxx Xxxxxx of America for such
purpose and for all other purposes for which
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a court would have jurisdiction under this Agreement, and each Party waives any
objection to venue in the Counties of New York, State of New York, or such
District.
11. NOTICES. All notices which are required by or may be given pursuant
to the terms of this Agreement must be in writing and must be delivered
personally, sent by certified mail, return receipt requested, postage prepaid,
facsimile (with written confirmation of transmission) provided, that, notice is
also sent via first class, postage prepaid, mail, or sent for next-day delivery
by a nationally recognized overnight delivery service as follows:
to the Company at: 00000 Xxxxxxx Xxxxx Xxxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxxxx 00000
Attn: President
Fax: (000) 000-0000
with a copy to: Feder, Kaszovitz, Isaacson, Weber, Xxxxx,
Bass & Rhine LLP
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx X. Xxxxx, Esq.
Fax: (000) 000-0000
to Employee at:: 0000 Xxxxx Xxxxx Xxxxx
Xxxxxxxx Xxxxxxx, XX 00000
Fax: (000) 000-0000
with a copy to: Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
000 Xxxxx Xxxxx Xxx., 00xx Xxxxx
Xxx Xxxxxxx, XX 00000
Attn: Xxxxx X. Xxxxxx, Esq.
Fax: (000) 000-0000
Any of the addresses set forth above may be changed from time to time by written
notice from the party requesting the change.
Such notices and other communications will be treated for all purposes of this
Agreement as being effective immediately if delivered personally or by facsimile
(with written confirmation of transmission), or five days after mailing by
certified mail, return receipt requested, first class postage prepaid, or one
day after deposit for next business day delivery by a nationally recognized
overnight delivery service.
12. AMENDMENT. No amendment of this Agreement shall be valid or
effective, unless in writing and signed by or on behalf of the parties hereto.
13. WAIVER. No course of dealing or omission or delay on the part of
either Party hereto in asserting or exercising any right hereunder shall
constitute or operate as a waiver of any such right. No waiver of any provision
hereof shall be effective, unless in writing and signed by
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or on behalf of the Party to be charged therewith. No waiver shall be deemed a
continuing waiver or waiver in respect of any other or subsequent breach or
default, unless expressly so stated in writing.
14. ASSIGNMENT. This Agreement, and each right, interest and obligation
hereunder, may not be assigned by either Party hereto without the prior written
consent of the other Party hereto, and any purported assignment without such
consent shall be void and without effect, except that this Agreement shall be
assigned to, and assumed by, any entity with or into which the Company merges or
consolidates, or which acquires all or substantially all of its assets, or which
otherwise succeeds to and continues the Company's business substantially as an
entirety.
15. BINDING EFFECT. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and permitted
assigns. This Agreement is not intended, and shall not be deemed, to create or
confer any right or interest for the benefit of any person not a Party hereto,
other than the persons or entities specifically identified as among the
releasees under Sections 3 and 4 of this Agreement.
16. TITLES AND CAPTIONS. The titles and captions of the Sections of this
Agreement are for convenience of reference only and do not in any way define or
interpret the intent of the parties or modify or otherwise affect any of the
provisions hereof.
17. GRAMMATICAL CONVENTIONS. Whenever the context so requires, each
pronoun or verb used herein shall be construed in the singular or the plural
sense and each capitalized term defined herein and each pronoun used herein
shall be construed in the masculine, feminine or neuter sense.
18. REFERENCES. The terms "herein," "hereto," "hereof," "hereby," and
"hereunder," and other terms of similar import, refer to this Agreement as a
whole, and not to any Section or other part hereof.
19. NO PRESUMPTIONS. No Party hereto is entitled to any presumption with
respect to the interpretation of any provision hereof or the resolution of any
alleged ambiguity herein based on any claim that the other Party hereto drafted
or controlled the drafting of this Agreement, the Parties acknowledging that
each Party and its counsel has participated in the preparation of this
Agreement.
20. COUNTERPARTS. This Agreement may be executed in counterparts, each
of which shall be deemed an original and which together shall constitute one and
the same agreement.
IN WITNESS WHEREOF each of the parties, intending to be legally bound,
has executed this Agreement.
(SIGNATURE PAGE FOLLOWS)
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EMPLOYEE:
/s/ Xxxxxxx Xxxxxx
--------------------------------------------
Xxxxxxx Xxxxxx
JAKKS PACIFIC, INC.
By: /s/ Xxxx Xxxxxxxx
-----------------------------------------
Xxxx Xxxxxxxx, Chairman & CEO
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STATE OF NEW YORK )
: ss.:
COUNTY OF YORK )
On the ______ day of _____________ , in the year 2004, before me, the
undersigned, a notary public in and for said state, personally appeared Xxxx
Xxxxxxxx, personally known to me or proved to me on the basis of satisfactory
evidence to be the individual whose name is subscribed to the within instrument
and acknowledged to me that he executed the same in his capacity, and that by
his signature on the instrument, the individual or the person upon behalf of
which the individual acted, executed the instrument.
/s/
--------------------------------------------
Notary Public
STATE OF NEW YORK )
: ss.:
COUNTY OF NEW YORK)
On the ______ day of _________________, in the year 2004, before me,
the undersigned, a notary public in and for said state, personally appeared
Xxxxxxx Xxxxxx, personally known to me or proved to me on the basis of
satisfactory evidence to be the individual whose name is subscribed to the
within instrument and acknowledged to me that he executed the same in his
capacity, and that by his signature on the instrument, the individual or the
person upon behalf of which the individual acted, executed the instrument.
/s/
--------------------------------------------
Notary Public
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