EXHIBIT 10.25
AMENDED AND RESTATED SEVERANCE AGREEMENT
This Amended and Restated Severance Agreement (this "AGREEMENT") is
made by and between SCM Microsystems, Inc. ("SCM"), and You, Xxxxxx Xxxxxx
("You" and "Your"), as of August 13, 2003 (the "EFFECTIVE DATE"). This Amended
and Restated Severance Agreement amends and restates in its entirety that
certain Agreement by and between SCM and You, dated as of June 29, 2003 (the
"ORIGINAL AGREEMENT").
1. Resignation. Effective June 29, 2003 (the "RESIGNATION DATE"),
You resigned as an employee of SCM and/or any of its subsidiaries and all
officer or director positions with SCM and/or any of its subsidiaries. All
options or other awards You hold under SCM's 1997 Stock Plan (or any other
similar options or awards) ceased vesting as of the Resignation Date and all
post-termination exercise periods will commence as of the Resignation Date (as
provided in the respective agreements between You and the Company). Your PTO
ceased accruing as of the Resignation Date.
2. Severance and Other Payments. Subject to You signing and not
revoking the settlement agreement and release in the form attached hereto as
Exhibit A (the "SETTLEMENT AGREEMENT AND RELEASE"), within 5 days of the date
hereof SCM will pay You $341,538.48 in cash, by check or wire transfer. Such
payment is in consideration of Your execution of the Settlement Agreement and
Release and is comprised of the following:
(a) A $115,000 transaction bonus related to SCM's sale of
substantially all of the digital video assets related to its former Digital
Media and Video division to Pinnacle Systems, Inc.; and
(b) A $251,000 severance payment (less $24,461.52
previously paid to You before the date hereof) in satisfaction of all salary,
wages, bonus (including second quarter MBO), severance, accrued PTO or similar
amounts that SCM owes You as of the Resignation Date and as of the date hereof.
You acknowledge that SCM has paid all salary, wages, bonuses, accrued
vacation and PTO, commissions, ESPP refunds and any and all other
employment-related benefits due to You once the payments and benefits referenced
in Sections 2 and 3 are received.
3. Medical Benefits. Subject to You executing and not revoking
the Settlement Agreement and Release, SCM will continue coverage of Your
existing medical benefits from the Resignation Date through September 30, 2003
consistent with the medical benefits SCM provided You immediately prior to the
Resignation Date.
4. Invention and Assignment Agreement. You and SCM have executed
and delivered an Invention Assignment Agreement (the "INVENTION AND ASSIGNMENT
AGREEMENT").
5. Removal of Files. To the extent You have not done so already,
You may remove Your personal files from SCM's premises. Any file containing
"Confidential Information" of the
Company (as that term is defined in the Invention and Assignment Agreement) may
not be removed from SCM's premises without the written consent of the Board of
Directors or the CEO of SCM.
6. Assignment. This Agreement will be binding upon and inure to
the benefit of (a) Your heirs, executors and legal representatives upon Your
death and (b) any successor of SCM. Any such successor of SCM will be deemed
substituted for SCM under the terms of this Agreement for all purposes. For this
purpose, "successor" means any person, firm, corporation or other business
entity which at any time, whether by purchase, merger or otherwise, directly or
indirectly acquires all or substantially all of the assets or business of SCM.
None of Your rights to receive any form of compensation payable pursuant to this
Agreement may be assigned or transferred except by the written consent of SCM,
by will or by the laws of descent and distribution. Any other attempted
assignment, transfer, conveyance or other disposition of Your right to
compensation or other benefits will be null and void.
7. Notices. All notices, requests, demands and other
communications called for hereunder will be in writing and will be deemed given
(a) on the date of delivery if delivered personally or by facsimile, (b) one (1)
day after being sent by a well established commercial overnight service, or (c)
four (4) days after being mailed by registered or certified mail, return receipt
requested, prepaid and addressed to the parties or their successors at the
following addresses, or at such other addresses as the parties may later
designate in writing:
If to SCM:
SCM Microsystems, Inc.
000 Xxxx Xxxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Fax: (000) 000-0000
Telephone: (000) 000-0000
Attn: Xxxxxx X. Xxxxx and Xxxxxx Xxxxxx
With a copy to:
Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx, P.C.
000 Xxxx Xxxx Xxxx
Xxxx Xxxx, XX 00000
Fax: (000) 000-0000
Telephone: (000) 000-0000
Attn: Xxxx X. Xxxxxx, Esq.
If to You, to You at:
Xxxxxx Xxxxxx
00000 Xxxxxx Xxxx Xxxxx
Xxxxxx Xxxx, XX 00000
Fax: (000) 000-0000
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Tel: (000) 000-0000
With a copy to:
Xxxxxxx XxXxxxxxx LLP
000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Fax: (000) 000-0000
Telephone: (000) 000-0000
Attn: Xxxx Xxxxxxxxxxxx, Esq.
8. Severability. In the event that any provision of this
Agreement (other than Section 2) becomes or is declared by a court of competent
jurisdiction to be illegal, unenforceable or void, this Agreement will continue
in full force and effect without said provision.
9. Confidentiality. You agree to maintain in confidence the
existence of this Agreement, the contents and terms of this Agreement, including
any documents incorporated by reference, and the consideration for this
Agreement.
10. Non-Disparagement. You and SCM agree to refrain from making
any negative comments about the other concerning their respective business,
products or services, officers, employees and directors and to refrain from any,
defamation, libel or slander of the other and their respective officers,
directors, employees, investors, shareholders, administrators, affiliates,
divisions, subsidiaries, predecessor and successor corporations, and assigns or
tortious interference with the contracts and relationships of the other and
their respective officers, directors, employees, investors, shareholders,
administrators, affiliates, divisions, subsidiaries, predecessor and successor
corporations, and assigns.
11. Entire Agreement. This Agreement (including Exhibit A),
together with the Invention and Assignment Agreement, represents the entire
agreement and understanding between SCM and You concerning the subject matter
hereof and supersedes and replaces any and all prior agreements (including,
without limitation, the Original Agreement) and understandings concerning Your
employment relationship with SCM, except for such agreements, policies or plans
that govern Your medical, retirement or pension benefits and except for any
stock option or similar agreements between You and SCM.
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12. Arbitration and Equitable Relief.
(a) Except as provided in Section 12(d) below, You and
SCM agree that to the extent permitted by law, any dispute or controversy
arising out of, relating to, or in connection with this Agreement (including the
Settlement Agreement and Release and any agreement referenced in Section 11
hereof), or the interpretation, validity, construction, performance, breach, or
termination thereof will be settled by arbitration to be held in the County of
Santa Clara, California, in accordance with the National Rules for the
Resolution of Employment Disputes then in effect of the American Arbitration
Association (the "RULES"). The arbitrator may grant injunctions or other relief
in such dispute or controversy. The decision of the arbitrator will be final,
conclusive and binding on the parties to the arbitration. Judgment may be
entered on the arbitrator's decision in any court having jurisdiction.
(b) The arbitrator will apply California law to the
merits of any dispute or claim (with the exception of its conflict of laws
provisions). You hereby expressly consent to the personal jurisdiction of the
state and federal courts located in California for any action or proceeding
arising from or relating to this Agreement and/or relating to any arbitration in
which the parties are participants.
(c) SCM will pay the direct costs and expenses of the
arbitration. SCM and You each will pay Your own counsel fees and expenses.
(d) SCM or You may apply to any court of competent
jurisdiction for a temporary restraining order, preliminary injunction, or other
interim or conservatory relief, as necessary to enforce the provisions of this
Agreement, without breach of this arbitration agreement and without abridgement
of the powers of the arbitrator.
(e) YOU HAVE READ AND UNDERSTAND THIS SECTION 12, WHICH
DISCUSSES ARBITRATION. YOU UNDERSTAND THAT BY SIGNING THIS AGREEMENT, YOU AGREE
TO THE EXTENT PERMITTED BY LAW, TO SUBMIT ANY FUTURE CLAIMS ARISING OUT OF,
RELATING TO, OR IN CONNECTION WITH THIS AGREEMENT, OR THE INTERPRETATION,
VALIDITY, CONSTRUCTION, PERFORMANCE, BREACH, OR TERMINATION THEREOF TO BINDING
ARBITRATION, AND THAT THIS ARBITRATION CLAUSE CONSTITUTES A WAIVER OF YOUR RIGHT
TO A JURY TRIAL AND RELATES TO THE RESOLUTION OF ALL DISPUTES RELATING TO ALL
ASPECTS OF THE EMPLOYER/EXECUTIVE RELATIONSHIP, INCLUDING BUT NOT LIMITED TO,
THE FOLLOWING CLAIMS:
(i) ANY AND ALL CLAIMS FOR WRONGFUL DISCHARGE OF
EMPLOYMENT; BREACH OF CONTRACT, BOTH EXPRESS AND IMPLIED; BREACH OF THE 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;
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(ii) ANY AND ALL CLAIMS FOR VIOLATION OF ANY
FEDERAL STATE OR MUNICIPAL STATUTE, INCLUDING, BUT NOT LIMITED TO, THE AMERICANS
WITH DISABILITIES ACT OF 1990, THE FAIR LABOR STANDARDS ACT, AND ANY LAW OF ANY
STATE; AND
(iii) ANY AND ALL CLAIMS ARISING OUT OF ANY OTHER
LAWS AND REGULATIONS RELATING TO EMPLOYMENT OR EMPLOYMENT DISCRIMINATION.
13. Cooperation with SCM. You will, for a period of six (6) months
after the date hereof, cooperate fully with SCM to the extent of your
availability, including, but not limited to, (a) responding to the reasonable
requests of SCM's Board or counsel, in connection with any and all existing or
future litigation, arbitrations, mediations or investigations brought by or
against SCM or any of its affiliates, agents, officers, directors or employees,
whether administrative, civil or criminal in nature, in which SCM reasonably
deems Your cooperation necessary or desirable and, (b) responding to reasonable
requests and providing information reasonably within Your knowledge regarding
SCM's results of operations, financial condition and performance, internal
controls, disclosure controls and procedures, accounting practices and policies,
reporting procedures and practices, other related information and any other
information reasonably within Your knowledge that is necessary or appropriate
for SCM to satisfy its obligations under the Securities Exchange Act of 1934, as
amended. During such period, You agree to provide reasonable advice, assistance
and information, including offering and explaining evidence, providing sworn
statements, participating in discovery and trial preparation and testimony as
may reasonably be deemed necessary or desirable by SCM relating to its position
in any such legal proceedings. During such period, You also agree to promptly
send SCM copies of all correspondence (for example, but not limited to,
subpoenas) received by You in connection with any such legal proceedings, unless
You are expressly prohibited by law from so doing. During such period, You will
act in good faith to furnish the information and cooperation required by this
Section 13 and SCM will act in good faith so that the requirement to furnish
such information and cooperation does not create an undue hardship for You. SCM
will advance to You all out-of-pocket expenses which you reasonably anticipate
You will incur as a result of Your cooperation, provided that You will provide
appropriate documentation thereof within ten (10) days of incurring any such
expenses, and, at the termination of the cooperation period, a reconciliation
shall be completed including appropriate credits or debits as necessary (i) to
reimburse You fully for all such expenses or (ii) to repay SCM any amounts you
owe for previous expense advancements. The failure by You to cooperate fully
with SCM in accordance with this Section 13 will be a material breach of the
terms of this Agreement. Notwithstanding anything in this Section 13, it is
agreed that if possible SCM will provide You with reasonable advance notice
regarding these activities, and that any requests made hereunder by SCM will be
made in good faith and reasonable.
14. No Oral Modification, Cancellation or Discharge. This
Agreement may be changed or terminated only in writing (signed by You and the
Chief Executive Officer of SCM (on behalf of SCM)).
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15. Waiver of Breach. The waiver of a breach of any term or
provision of this Agreement, which must be in writing, will not operate as or be
construed to be a waiver of any other previous or subsequent breach of this
Agreement. No breach of any covenant hereunder by You will relieve SCM of any
obligation to make any payment required hereunder; provided, however, that the
foregoing does not require SCM to make any payment hereunder unless and until
the satisfaction or waiver of the conditions precedent to the making of such
payment. For the avoidance of doubt, nothing contained in this Section 15 limits
SCM's right to take any action against you, whether equitable or legal, as a
result of Your breach of a covenant hereunder.
16. Headings. All captions and section headings used in this
Agreement are for convenient reference only and do not form a part of this
Agreement.
17. Withholding. SCM is authorized to withhold, or cause to be
withheld, from any payment or benefit under this Agreement the full amount of
any withholding taxes required by applicable law.
18. Governing Law. This Agreement will be governed by the laws of
the State of California (with the exception of its conflict of laws provisions).
19. Authority. SCM represents and warrants that the person signing
this Agreement on its behalf has full authority to act for SCM.
20. Counterparts. This Agreement may be executed in counterparts,
and each counterpart will have the same force and effect as an original and will
constitute an effective, binding agreement on the part of each of the
undersigned.
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21. Acknowledgment. You acknowledge that You (i) have read this
Agreement, (ii) have been represented in the preparation, negotiation, and
execution of this Agreement by legal counsel of Your own choice or that You
voluntarily have declined to seek counsel, (iii) understand the terms and
consequences of this Agreement, and (iv) are fully aware of the legal and
binding effect of this Agreement.
IN WITNESS WHEREOF, the undersigned have executed this Agreement on the
respective dates set forth above.
XXXXXX XXXXXX
/s/ Xxxxxx Xxxxxx
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Xxxxxx Xxxxxx
SCM MICROSYSTEMS, INC.
By: /s/ Xxxxxx Xxxxxxxxx
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Title: Chief Executive Officer
[XXXXXX XXXXXX/SCM MICROSYSTEMS, INC.
AMENDED AND RESTATED SEVERANCE AGREEMENT SIGNATURE PAGE]
