EXHIBIT 10.54
EXECUTIVE SEPARATION AGREEMENT
THIS EXECUTIVE SEPARATION AGREEMENT (the "Agreement") is entered into this
__ day of January, 1998, by and between Retix ("Company") and Xxxxx Xxxxxx
("Employee").
WHEREAS, the Company and Employee have mutually agreed to terminate the
employment relationship between them.
NOW, THEREFORE, IT IS AGREED as follows:
I. TERMS OF SEPARATION AND TRANSITION
1. Employee's resignation as Vice President of Finance and Administration
and Chief Financial Officer shall be deemed effective as of the close of
business on December 27, 1997 (the "Termination Date"). Employee's resignation
from any other positions with any other entity which may be deemed to be an
affiliate of the Company shall also be effective on the Termination Date, other
than with respect to Sonoma Systems and its subsidiaries, in which positions
Employee shall continue at the discretion of the Board of Directors of such
corporation.
2. In contemplation of the separation, the parties agree:
(a) In addition to all regular compensation owing to Employee through
the Termination Date, Employee shall be entitled to severance payments as
follows: (i) an amount equal to three months of Employee's base rate of
compensation as in effect immediately prior to the Termination Date shall be
paid as soon as practical following the Effective Date (as defined in Section
6(d) below) of this Agreement; (ii) an additional amount also equal to three
months of Employee's base rate of compensation as in effect immediately prior to
the Termination Date shall be paid on the next regular Company payroll date
occurring on or after March 31, 1998; (iii) a further payment of $70,000 payable
on the execution of this Agrement by both parties; and (iv) a final severance
payment of $30,000 payable on July 1, 1998.
(b) The vesting of all options to purchase shares of Common Stock of
the Company previously issued and outstanding under the Company's 1988 Stock
Option Plan to Employee shall be accelerated in full with the effect that
Employee shall be entitled to exercise all such options, or in the event they
have been previously exercised, to have the underlying shares of Common Stock
issued upon exercise of such options released from any rights of repurchase in
favor of the Company.
(c) All notes previously provided by Employee to the Company in
connection with such exercises shall become due and payable in full on December
31, 1998 (the "Repayment Date") If Employee requests the release of any shares
of the Company's Common Stock held as security for the payment of such notes by
Employee in connection with the
proposed sale or other disposition of such shares by Employee, Employee agrees
to repay at least that percentage of the then outstanding principal owed under
all such notes as is equal to the percentage of shares then held by the Company
as security as a condition to the release of such shares.
(d) Employee shall remain available to provide continuing reasonable
and customary transition support as requested by the Company's current executive
officers during the first six months following the Termination Date. Such
support, generally in the form of telephonic, fax or e-mail communication shall
be with respect to areas within the general scope of Employee's duties while he
was employed as an executive officer by the Company. No additional compensation
shall be paid for such transition support unless extraordinary in nature, in
which case it shall be at Employee's option to provide such extraordinary
support and for such additional compensation as may be agreed between the
Company and Employee.
II. NON-DISCLOSURE AND NONCOMPETITION AGREEMENT
3. Employee understands and agrees that his obligations to the Company
under his existing Retix Employee Proprietary Information and Inventions
Agreement between Employee and Company dated June 21, 1990 (the "Proprietary
Information Agreement"), a copy of which is attached hereto as Exhibit A, shall
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survive termination of his relationship with Company under this Agreement.
4. Executive hereby agrees that he shall not do any of the following on or
prior to the Repayment Date without the prior written consent of the President
or the Board of Directors of the Company:
(a) Carry on anywhere in the United States any business or activity
(whether directly or indirectly, as a partner, shareholder, principal, agent,
director, affiliate or consultant) which is directly competitive with the
business conducted by the Company at the time of termination of Executive's
employment. It is agreed that ownership of no more than one percent of the
outstanding voting stock of a publicly traded corporation, ownership of no more
than five percent of the outstanding voting stock of a privately held
corporation or ownership of no more than ten percent of the limited partnership
interests of a partnership shall not constitute a violation of this provision.
(b) Solicit or influence or attempt to influence any client, customer
or other person either directly or indirectly, to direct, his or its purchase of
the Company's products and/or services to any person, firm, corporation,
institution or other entity in competition with the business of the Company.
(c) Solicit or influence or attempt to influence any person employed by
the Company to terminate or otherwise cease his employment with the Company or
become an employee of any competitor of the Company.
(d) The covenants set forth in this Section 4 shall be effective
commencing as of the date hereof and shall continue for so long as cash payments
continue to be made to
Executive under this Agreement.
III. RELEASE OF CLAIMS
5. Employee agrees that the foregoing provisions represent settlement in
full of all outstanding obligations owed to Employee by the Company. Employee
and the Company, on behalf of themselves, and their respective heirs, executors,
officers, directors, employees, investors, shareholders, administrators,
predecessor and successor corporations, and assigns, hereby fully and forever
release each other and their respective heirs, executors, officers, directors,
employees, investors, shareholders, administrators, predecessor and successor
corporations, and assigns, from, and agree not to xxx concerning, any claim,
duty, obligation or cause of action relating to any matters of any kind, whether
presently known or unknown, suspected or unsuspected, that any of them may
possess arising from any omissions, acts or facts that have occurred up until
and including the Effective Date of this Agreement relating to Employee's
employment with the Company including, without limitation,
(a) any and all claims relating to or arising from Employee's
employment relationship with the Company and the termination of that
relationship;
(b) any and all claims relating to, or arising from, Employee's right
to purchase, or actual purchase of shares of stock of the Company;
(c) any and all claims for wrongful discharge of employment; breach of
contract, both express and implied; breach of a covenant of good faith and fair
dealing, both express and implied; negligent or intentional infliction of
emotional distress; negligent or intentional misrepresentation; negligent or
intentional interference with contract or prospective economic advantage; and
defamation;
(d) any and all claims for violation of any federal, state or municipal
statute, including, but not limited to, Title VII of the Civil Rights Act of
1964, the Civil Rights Act of 1991, the Age Discrimination in Employment Act of
1967, the Americans with Disabilities Act of 1990, the Fair Labor Standards Act,
and the California Fair Employment and Housing Act;
(e) any and all claims arising out of any other laws and regulations
relating to employment or employment discrimination; and
(f) any and all claims for attorneys' fees and costs.
The Company and Employee agree that the release set forth in this
section shall be and remain in effect in all respects as a complete general
release as to the matters released. This release does not extend to any
obligations incurred under this Agreement.
6. Employee acknowledges that he is waiving and releasing any rights he
may have under the Age Discrimination in Employment Act of 1967 ("ADEA") and
that this waiver and release is knowing and voluntary. Employee and the Company
agree that this waiver and release does not apply to any rights or claims that
may arise under ADEA after the Effective Date of this
Agreement. Employee acknowledges that the consideration given for this waiver
and release Agreement is in addition to anything of value to which Employee was
already entitled. Employee further acknowledges that he has been advised by this
writing that:
(a) he should consult with an attorney prior to executing this
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Agreement;
(b) he has at least twenty-one (21) days within which to consider this
Agreement;
(c) he has at least seven (7) days following the execution of this
Agreement by the parties to revoke the Agreement; and
(d) this Agreement shall not be effective (the "Effective Date") until
the revocation period has expired.
7. The Company and the Employee represent that they are not aware of any
claim by either of them other than the claims that are released by this
Agreement. Employee and the Company acknowledge that they have had the
opportunity to consult with legal counsel concerning, and are familiar with, the
provisions of California Civil Code Section 1542, which provides 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.
Employee and the Company, being aware of said code section, agree to waive
expressly any rights they may have thereunder, as well as under any other
statute or common law principles of similar effect.
IV. OTHER PROVISIONS; GENERAL
8. Each party agrees to refrain from any disparagement, defamation,
slander of the other, or tortious interference with the contracts and
relationships of the other.
9. Employee retains any rights to indemnification that he may have under
California law. The Company will continue to be obligated to indemnify and
defend Employee to the full extent required by California Labor Code Section
2802 and any rights under the Company's Articles of Incorporation, Bylaws and
Indemnification Agreement between the Company and Employee dated as of September
27, 1994.
10. This Agreement together with the written agreements referenced in this
Agreement represent the entire agreement and understanding between the Company
and Employee concerning Employee's separation from the Company, and together
supersede and
replace any and all prior agreements and understanding concerning Employee's
relationship with the Company and his compensation by the Company.
11. This Agreement may only be amended in writing signed by Employee and
the Chief Executive Officer of the Company.
12. This Agreement shall be governed by the laws of the State of
California without reference to provisions concerning conflicts of laws.
13. This Agreement is effective seven days after it has been signed by
both parties.
14. This Agreement may be executed in counterparts, and each counterpart
shall have the same force and effect as an original and shall constitute an
effective, binding agreement on the part of each of the undersigned.
15. This Agreement is executed voluntarily and without any duress or undue
influence on the part or behalf of the parties hereto, with the full intent of
releasing all claims. The parties acknowledge that:
(a) They have read this Agreement;
(b) They have been represented in the preparation, negotiation, and
execution of this Agreement by legal counsel of their own choice or that they
have voluntarily declined to seek such counsel;
(c) They understand the terms and consequences of this Agreement and
of the releases it contains;
(d) They are fully aware of the legal and binding effect of this
Agreement.
IN WITNESS THEREOF, the parties have executed this Agreement on the
respective dates set forth below.
RETIX
Dated: January ____, 1998 By
________________________________
Xxxxx Xxxxx, President & CEO
EMPLOYEE
Dated: January ____, 1998 ________________________________
Xxxxx Xxxxxx
EXHIBIT A
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PROPRIETARY INFORMATION AGREEMENT
