CONFIDENTIAL SEVERANCE AND RELEASE AGREEMENT
EXHIBIT
10.18
THIS SEVERANCE AND RELEASE
AGREEMENT (“Severance Agreement”) is made by and between Xxxxxx Xxxxxxx Xxxxxx
(hereinafter “XXXXXX”) and Xxxxxx Xxxxxx, Inc., a New
York corporation, having its principal place of business at 000 Xx. Xxxx Xxxx,
Xxxxxxx Xxxxx, XX 00000 (“XXXXXX”):
RECITALS
WHEREAS, for purposes of this
Severance Agreement, “XXXXXX” means XXXXXX XXXXXX, INC., and each and all of its
present and former parent and subsidiary corporations, departments, divisions,
affiliates, representatives and agents, employees, directors, officers,
attorneys, current or former board members and administrators, whether in their
official or individual capacities, or any pension or benefit plan applicable to
the present and former employees of XXXXXX, and all predecessors, and/or
successors in interest; and
WHEREAS, as a result of
XXXXXX’x separation of employment with XXXXXX, and to fully and finally resolve
any and all issues concerning XXXXXX’x employment relationship with XXXXXX, from
the beginning of time up to the date of this Severance Agreement, XXXXXX and
XXXXXX have decided to enter into this Severance Agreement.
NOW, IN CONSIDERATION of the
payments to XXXXXX provided for herein, and other good and valuable
consideration, the receipt and sufficiency of which the parties acknowledge, and
the mutual promises and covenants contained herein, the parties agree as
follows:
1. Resignation as Senior Vice
President, General Counsel and Corporate Secretary/Separation of
Employment. XXXXXX and XXXXXX agree that XXXXXX resigned as an
officer of XXXXXX effective May 4, 2007 (“Resignation
Date”). XXXXXX and XXXXXX further agree that he will remain an
employee of XXXXXX on inactive status beginning on May 5, 2007 and continuing
for eighteen (18) months through November 4, 2008. XXXXXX’x
employment relationship with XXXXXX will be terminated on November 4, 2008, upon
his death, or upon the effective date of termination as further described in
Paragraph 1(f) below, whichever event occurs sooner (“Termination
Date”).
(a) Severance. As
consideration for XXXXXX’x execution of and
compliance with this Severance
Agreement, in addition to those items set forth in subparts (b)-(g) of this
Paragraph, XXXXXX agrees to pay to XXXXXX eighteen (18) months of pay based upon
an annual rate of $215,000 (“Severance”). This Severance shall be
subject to all appropriate federal and state withholding, employment taxes and
wage garnishments. The parties agree that XXXXXX will receive this
Severance on the regular pay days for XXXXXX employees. XXXXXX will
not be eligible to receive any bonus or other compensation or stock
options.
(b) Auto. XXXXXX
agrees to pay XXXXXX the sum of $16,665 to compensate him for
the loss of his company automobile, within fifteen (15) business days after the
later of (i) the Effective Date (as defined in Paragraph 3 of this Severance
Agreement), and (ii) the date XXXXXX returns the automobile to the dealer as
provided in the applicable leasing agreement.
(c) Reference. XXXXXX
agrees to provide XXXXXX with a favorable reference from its current chairman of
the board, Xxxxxxxx X. Xxxxxxx.
(d) Benefits
Continuation. As further consideration for XXXXXX’x execution
of and compliance with this Severance Agreement, XXXXXX will continue to provide
health, dental and life insurance benefits to XXXXXX through the Termination
Date. XXXXXX will have the opportunity and responsibility to
elect COBRA continuation coverage after his Termination Date and will thus be
responsible for the execution of the continuation of coverage forms upon
termination of his insurance coverage. XXXXXX acknowledges and
agrees that he is required to immediately contact XXXXXX in writing if he
becomes eligible to receive medical benefits through a new employer, if he
obtains medical benefits from another source, or if he otherwise becomes
disqualified for medical benefits or COBRA from XXXXXX. Further,
XXXXXX reserves the
right to amend, modify or terminate its benefit coverages at any time at the
sole discretion of XXXXXX, provided that any such amendment, modification or
termination of such benefit coverages are not made solely to deny XXXXXX or his
dependents coverage thereunder.
(e) 401(k). XXXXXX agrees
that XXXXXX shall have the right to continue contributions to XXXXXX’x 401(k)
plan through the Termination Date. XXXXXX reserves the right
to amend, modify or terminate its 401(k) plan at any time at the sole discretion
of XXXXXX, provided that any such amendment, modification or termination of such
plan is are not made solely to deny XXXXXX the benefit thereof.
(f)Termination
Right. XXXXXX
shall have the right to terminate his inactive employment at any time after
January 1, 2008, upon fifteen calendar days written notice to XXXXXX (to the
attention of Xxxxxxx X’Xxxxxxxxx, Xx. Vice President, Administrative Services
Group) in which case XXXXXX shall pay to XXXXXX a lump sum equal to the balance
of the salary continuation payments owing to XXXXXX from the effective date of
termination through November 4, 2008. The “effective date of
termination” shall be the first regular payroll date following XXXXXX’x receipt
of XXXXXX’x termination notice on which XXXXXX can make the aforementioned lump
sum payment, taking into account XXXXXX’x standard payroll
practices. For the avoidance of doubt, XXXXXX’X participation in the
employee benefit plans described in Paragraphs 1(d) and (e) shall cease on the
effective date of termination.
(g) Payments to Xxxxxx’x
Wife/Estate. If the Termination Date occurs prior to November
4, 2008 due to XXXXXX’X death, XXXXXX shall make the payments described in
Paragraphs 1(a) and (b) to XXXXXX’x widow or to XXXXXX’x estate if XXXXXX’x wife
predeceases him. For the avoidance of doubt, XXXXXX’X widow or
estate, as the case may be, shall have the right to elect to receive the lump
sum payment, in accordance with Paragraph 1(f).
(h) Sufficiency of
Consideration; No Admission of Liability. The parties agree
that the consideration paid to XXXXXX is good and sufficient consideration for
this Severance Agreement. The parties further agree that these
amounts are greater than what XXXXXX is entitled to receive from XXXXXX under
XXXXXX’x policies and applicable law. XXXXXX acknowledges that
neither this Severance Agreement, nor payment of any consideration pursuant to
this Severance Agreement, shall be taken or construed to be an admission or
concession of any kind with respect to alleged liability or alleged wrongdoing
by XXXXXX.
2. (a) General and Specific Release
and Waiver of Claims by XXXXXX. XXXXXX, in consideration of
the promises and covenants made by XXXXXX in this Severance Agreement, hereby
knowingly and voluntarily compromises, settles and releases and forever
discharges XXXXXX, its present and former parent, subsidiaries, divisions,
affiliates, agents, employees, directors, officers, predecessors, successors,
and assigns from any and all actions, causes of action, suits, claims, charges
or complaints, known or unknown, which XXXXXX has, may have, or claim to have,
for everything and anything that has occurred from the beginning of time through
the date of this Severance Agreement, including all of XXXXXX’x asserted claims,
if any.
XXXXXX acknowledges that the above
general and specific releases include, but are not limited to, claims arising
under federal, state, and local laws prohibiting employment discrimination,
whistleblowing or retaliation, claims arising under the common law, including
but not limited to, claims for breach of contract, promissory estoppel,
negligent or intentional infliction of emotional distress and defamation, and
any other claims arising in any way from XXXXXX’x employment and cessation of
employment, and any conduct by XXXXXX, and its present and former
subsidiaries, divisions, affiliates, agents, employees, directors, officers,
predecessors, successors, and assigns from the beginning of time through the
date of this Severance Agreement.
By way of specification, but not of
limitation, XXXXXX hereby expressly waives and releases any and all claims or
rights arising under Title VII of the Civil Rights Act of 1964, as amended, 42
U.S.C. §§ 2000e, et
seq., Section 1981 of the Civil Rights Act of 1866, as amended, 42 U.S.C.
§§ 1981, the New Jersey Law Against Discrimination, N.J.S.A. 10:5-1 et seq., the New Jersey
Conscientious Employee Protection Act, N.J.S.A. 34:19-1, et seq., the New Jersey Wage
and Hour laws N.J.S.A. 34:11-56a, et seq., and the New Jersey
Family Leave Act, N.J.S.A. 34:11B-1, et seq., the Age
Discrimination in Employment Act of 1967, 29 U.S.C. § 626, et seq., the Americans with
Xxxxxxxxxxxx Xxx, 00 X.X.X. § 00000 et seq., the Family and
Medical Leave Act, 29 U.S.C. §2601 et seq., the Employee
Retirement Income Security Act 29 U.S.C. § 1001 et seq., the Xxxxxxxx-Xxxxx
Act of 2002, 18 U.S.C. § 1514A, any and all claims under New Jersey
law, Pennsylvania law, and any and all claims for compensatory and punitive
damages and attorneys' fees, costs or other expenses incurred by XXXXXX’x
attorneys in pursuit of any claim by XXXXXX.
(b) General Release and Waiver
of Claims by XXXXXX. XXXXXX, in consideration of the promises
and covenants made by XXXXXX in this Severance Agreement, hereby knowingly and
voluntarily compromises, settles and releases and forever discharges XXXXXX from
any and all actions, causes of action, suits, claims, charges or complaints,
known or unknown, which XXXXXX has, may have or claim to have, for everything or
anything that has occurred from the beginning of time through the date of this
Severance Agreement.
3. Consideration and Revocation
Periods; Effective Date. XXXXXX understands that the ADEA
requires XXXXXX to provide XXXXXX with at least twenty-one (21) calendar days to
consider this Severance Agreement (“Consideration Period”) prior to its
execution. XXXXXX also understands that he is entitled to revoke this
Severance Agreement at any time during the seven (7) days following XXXXXX’x
execution of this Severance Agreement (“Revocation Period”) by notifying XXXXXX
(to the attention of Xxxxxxx X’Xxxxxxxxx, Xx. Vice President, Administrative
Services Group) in writing of his revocation. This Severance
Agreement shall become effective on the day after the seven-day Revocation
Period has expired unless timely notice of XXXXXX’x revocation has been
delivered to XXXXXX (the “Effective Date”).
4. Return of Company
Property. XXXXXX acknowledges that he has returned to XXXXXX
any and all documents, keys, records and all other tangible things which are the
property of XXXXXX.
5. Cooperation. Upon
invoking the rights and benefits provided for in this Severance Agreement,
XXXXXX agrees to make himself available to XXXXXX, to the extent necessary, to
transition his successor, for a period of up to ninety (90) days following the
Effective Date, as defined in Section 3 hereof. In addition, XXXXXX
agrees to cooperate with XXXXXX during the period he is an inactive employee
with respect to any litigation in which he has relevant knowledge.
6. Confidential
Information. XXXXXX represents that he has held confidential
all non-public lists of customers, prices, business plans, strategic plans, and
other non-public financial information and other confidential or proprietary
information of XXXXXX and shall continue to do so and that he shall not use or
disclose any such information in any manner, either directly or indirectly, for
XXXXXX'x own benefit or for the benefit of any other person or other entity
without the prior written consent of XXXXXX, and the granting of such consent
shall remain in the sole discretion of XXXXXX. XXXXXX shall return to
XXXXXX, to the extent he has not done so already, and shall not take or copy in
any form or manner, any lists of customers, prices, business plans, strategic
plans and other non-public financial information and other confidential and
proprietary information of XXXXXX in his possession. XXXXXX and his
counsel further agree that they will notify XXXXXX’x General Counsel in writing
within five (5) calendar days of the receipt of any subpoena, court order,
administrative order or other legal process requiring disclosure of information
subject to this confidential information provision so that XXXXXX may seek an
appropriate protective order or other appropriate remedy or waive compliance
with the provisions hereof. XXXXXX shall reasonably cooperate with XXXXXX
to obtain such a protective order or other remedy. If such order or
other remedy is not obtained prior to the time XXXXXX is required to make the
disclosure, or XXXXXX waives compliance with the provisions hereof, XXXXXX shall
disclose only that portion of the confidential or proprietary information which
he is advised by counsel that he is legally required to so
disclose. The provisions of this Paragraph are necessary for the
protection of the business and goodwill of XXXXXX and are considered by XXXXXX
to be reasonable for such purpose. XXXXXX agrees that any breach of any of the
terms of this Paragraph may cause XXXXXX substantial and irreparable damages
and, therefore, in the event of any such breach, in addition to other remedies
which may be available XXXXXX shall have the right to seek specific performance
and other injunctive and equitable relief, and XXXXXX agrees not to oppose the
granting of such injunctive and equitable relief on the basis that XXXXXX has an
adequate remedy at law.
7. Confidentiality. XXXXXX
acknowledges and understands that the confidentiality of this Severance
Agreement is of the utmost concern to XXXXXX and that XXXXXX would not have
entered into this Agreement without his promise to keep this Severance Agreement
confidential. Accordingly, XXXXXX agrees that the existence and terms
and conditions of this Severance Agreement shall remain confidential, and XXXXXX
and his representatives hereby represent, promise and agree that they have not
disclosed and will not disclose the terms of this Severance Agreement to any
person other than XXXXXX’x (1) accountant, (2) attorneys, or (3) any tax
professional to whom such disclosure is necessary for the preparation of
XXXXXX’x income tax returns, (4) spouse, or (5) the Internal Revenue Service,
unless such disclosure is (i) lawfully required by specific directive of a
government agency; (ii) otherwise required to be disclosed by law (such as
legally required financial reporting), order of a court of competent
jurisdiction and/or subpoena; or (iii) necessary in any legal proceeding between
the parties in order to enforce any provision of this Agreement. If
XXXXXX discusses matters covered by this Paragraph with his spouse, legal
counsel or financial advisor pursuant to the exception contained herein and any
such person then publicizes any such matter, it shall be treated as if XXXXXX
himself made the publication. XXXXXX hereby agrees that his
intentional disclosure of the existence or terms shall be a material breach of
this Agreement and that the provisions of this Paragraph are necessary for the
protection of the business and goodwill of XXXXXX and are considered by XXXXXX
to be reasonable for such purpose. XXXXXX agrees that any breach of
any of the terms of this Paragraph may cause XXXXXX substantial and irreparable
damages and, therefore, in the event of any such breach, in addition to other
remedies which may be available, XXXXXX shall have the right to seek
specific performance and other injunctive and equitable relief.
XXXXXX further agrees that he will notify XXXXXX’x General Counsel in writing
within five (5) calendar days of the receipt of any subpoena, court order,
administrative order or other legal process requiring disclosure of information
subject to this confidentiality provision. XXXXXX and his counsel
agree and represent that their only comment with regard to either XXXXXX’x
asserted claims or the fact or terms of this settlement shall be: “The parties
have resolved their differences.”
8. No
Disparagement. XXXXXX hereby agrees and promises that he will
not at any time after the execution of this Agreement intentionally make,
publish or cause to be made or published, any false or disparaging statements or
comments which in any way relate to, refer to or concern XXXXXX, or any of its
employees, officers or directors. XXXXXX hereby agrees that if he
intentionally makes, publishes, or causes such false or disparaging statements
or comments to be made or published, then such intentional disparagement shall
be a material breach of this Agreement. The provisions of this
Paragraph are necessary for the protection of the business and goodwill of
XXXXXX and are considered by XXXXXX to be reasonable for such
purpose. XXXXXX agrees that any intentional breach of any of the
terms of this Paragraph may cause XXXXXX substantial and irreparable damages
and, therefore, in the event of any such breach, in addition to other remedies
which may be available, XXXXXX shall have the right to seek specific
performance and other injunctive and equitable relief.
9. Representation by
Attorney. XXXXXX acknowledges that XXXXXX has carefully read
this Severance Agreement; that XXXXXX understands its final and binding effect;
that XXXXXX has been given the opportunity to be represented by independent
counsel in negotiating and executing this Severance Agreement and that XXXXXX
has been advised by counsel regarding the terms and effect of this Severance
Agreement at the time he executed the Settlement and Release Agreement
referenced above and has had the subsequent opportunity to do so since that
time; and that XXXXXX understands the provisions of this Severance Agreement and
knowingly and voluntarily agrees to be bound by them.
10. No Reliance Upon
Representations. XXXXXX hereby represents and acknowledges
that in executing this Severance Agreement, XXXXXX does not rely and has not
relied upon any representation or statement made by XXXXXX or by any of XXXXXX’x
past or present agents, representatives or attorneys with regard to the subject
matter, basis or effect of this Severance Agreement other than as set forth in
this Severance Agreement.
11. Entire
Agreement. This Severance Agreement shall contain the entire
agreement between the parties, and fully supersedes any prior agreements or
understandings between the parties. The parties agree that they shall
have not any obligations with regard to each other or the subject matter of this
Severance Agreement except as expressly stated herein. This Severance
Agreement shall not be modified except in writing signed by the party to be
bound.
12. Severability. If
a court finds any provision of this Severance Agreement void, invalid or
unenforceable as applied to any circumstance, the remainder of this Severance
Agreement and the application of such provision shall be interpreted so as best
to effect the intent of the parties hereto. The parties further agree
to replace any such void, invalid or unenforceable provision of this Severance
Agreement with a valid and enforceable provision that will achieve, to the
extent possible, the economic, business, or other purposes of the void or
unenforceable provision.
13. Miscellaneous. XXXXXX
agrees not to apply for employment with XXXXXX.
14. Governing
Law. This Agreement shall be governed by the laws of the State
of New Jersey without giving effect to any conflicts of law
principles. The parties also agree that the state and federal courts
in the State of New Jersey shall have exclusive jurisdiction and venue over the
subject matter hereof.
XXXXXX
XXXXXX, INC.
Date: By:
Name: Xxxxxxx
X. Xxxxxxxxxx
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Title:
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Sr.
Vice President, General Counsel & Corporate
Secretary
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Date: ACCEPTED AND
AGREED:
Xxxxxx Xxxxxxx Xxxxxx