EXHIBIT 10.11
VOLUNTARY RELEASE AND EXIT AGREEMENT
This Voluntary Release and Exit Agreement ("Agreement"),
entered into by and between Competitive Technologies, Inc.
("Company"), and Xxxxxx X. Xxxxxxx ("Employee"), sets forth all the
rights, duties, obligations and concessions of the parties. In
consideration of the promises contained herein and other good and
valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties agree as follows:
1. Resignation. Employee resigns Employee's employment with
the Company and any and all affiliated and related entities
(collectively "Affiliates"), including without limitation his
employment under the Employment Agreement between the parties dated
as of August 1, 1995 ("Employment Agreement"), and all positions,
offices and directorships which Employee held with the Company or
Affiliates, effective October 14, 1998, ("Resignation Date"). In
addition, Employee resigns as a member of the Company's Board of
Directors ("Board") effective on the Resignation Date. All such
resignations are deemed accepted by the Company as of the
Resignation Date. Employee will execute all documents necessary to
effectuate such resignations. The Company agrees not to contest
any unemployment compensation claim filed by Employee for the
period after July 31, 1999.
2. Consideration.
(a) The Company agrees to continue to pay Employee his base
salary in effect on the date prior to the Resignation Date (at the
rate of $197,000 per year) through July 31, 1999 ("Salary
Continuation"). In addition, within 14 days of the Effective Date
of this Agreement, the Company will pay to Employee the additional
gross amount of $25,000 (minus lawful deductions) representing any
and all accrued but unused vacation pay due to Employee. Salary
Continuation will be paid on the Company's regular pay days, minus
all lawful deductions, in accordance with the Company's standard
practices for payment of salary. The Company agrees that at
Employee's written request received on or after March 20, 1999, The
Company will pay to Employee the remainder of the Salary
Continuation due in a lump sum payment, minus all lawful
deductions, to be made within 15 days of the date of receipt of
such written request. In the event of Employee's death, any
payments due under this Section 2(a) shall be paid to Employee's
estate.
(b) The Company agrees to pay the premiums for Employee's
COBRA health insurance coverage beginning on the Effective Date of
this Agreement. In addition, the Company will continue to pay the
premiums for Employee's group life and dental insurance on the same
terms as such are provided to the Company's senior executives. The
Company's payment of such premiums described in this Section 2(b)
will continue until the earlier of: (i) July 31, 1999, or (ii) the
date on which Employee's right to continuation coverage terminates
under COBRA.
(c) Through July 31, 1999, the Company will pay to Employee,
in addition to the Salary Continuation, the gross amount of $617.00
per month which is equal to the amount of the current monthly lease
payments and reasonable automobile insurance payments on the 1998
Lincoln Navigator, originally leased by the Company which lease
has been assigned to Employee, and an additional amount, calculated
by the Company in its reasonable discretion, substantially equal to
the increased income tax payable by Employee due to such payments
for the car lease. Also, through July 31, 1999, the Company will
reimburse Employee for any reasonable automobile maintenance
expenses not covered by warranty and for a monthly fee in the
amount of $400 for the cellular phone currently provided to him by
the Company. Employee will provide monthly expense requests to the
Company with appropriate supporting documentation for such
reimbursable expenses.
(d) For a period of up to six months following the
Resignation Date, the Company agrees to furnish Employee with
outplacement assistance, including use of an office, phone, fax,
copier and secretarial assistance, through a mutually acceptable
outplacement firm, the total cost to the Company not to exceed
$2,000 per month; the invoices for which shall be submitted
directly to the Company by such outplacement firm.
(e) Except as provided in this Agreement, Employee is not
entitled to any pay or benefits from the Company after the
Resignation Date. The parties acknowledge that this Agreement
provides to Employee payments and benefits to which Employee is not
otherwise entitled.
(f) The Company agrees to pay the premium on the term life
insurance policy currently provided to Employee through May 22,
1999 and will pay on Employee's behalf or reimburse Employee for
the pro-rata premium to continue such policy through July 31, 1999.
The premium on such policy is $1,245.00 per year. The Company will
not object to Employee continuing to carry such policy after July
31, 1999.
3. Options.
(a) The parties acknowledge that the Company has provided to
Employee certain options to purchase Company stock in accordance
with its stock option plans as amended and restated from time to
time (collectively the "Stock Option Plan") and pursuant to certain
stock option agreements between the Company and Employee regarding
such options (the "Option Agreements").
(b) The parties acknowledge that Employee currently is vested
in 190,000 options to purchase shares of Company stock, such
options being listed on Exhibit A to this Agreement. The Company
agrees to extend until July 31, 2001 the date for Employee to
exercise the Exhibit A Options, and the parties agree that any
options owned by Employee but not exercised on or before July 31,
2001 shall terminate at the close of business on July 31, 2001.
(c) Except as specifically provided in this Section 3, the
Option Agreements will remain in full force and effect. Employee
understands that to the extent any incentive stock options granted
to Employee are not exercised within three months of the
Resignation Date, such options shall convert to nonstatutory stock
options.
(d) Employee agrees to indemnify the Company, the Affiliates
and Released Parties (as hereinafter defined) and hold it and them
harmless against any claims, liability, costs and expenses,
including attorneys' fees, incurred as a result of or in connection
with any claims that Employee's spouse may make with respect to
Employee's stock options, whether in connection with Employee's
divorce settlement or otherwise.
4. Full and General Release by Employee. Employee on behalf
of Employee and Employee's agents, assignees, executors, heirs and
representatives, releases and forever discharges the Company, and
the Affiliates, and each of their administrators, affiliates,
assigns, attorneys, consultants, directors, divisions, employees,
executors, officers, parent corporation, predecessors,
representatives, shareholders, subsidiaries and successors
(collectively "Released Parties") from any and all actions,
attorneys' fees, causes of action, claims, controversies, costs,
covenants, damages, debts, demands, fees, grievances, suits, sums
of money or other obligations which have arisen or may arise on or
before the date this Agreement is executed by Employee whether in
law, at equity or otherwise under any common law, statute,
regulation, ordinance, or executive order including but not limited
to any claim for defamation, promissory estoppel, breach of
contract, wrongful termination, retaliatory discharge,
discrimination or intentional infliction of emotional distress,
under the Age Discrimination in Employment Act, the Older Workers
Benefit Protection Act, Title VII of the Civil Rights Act of 1964,
the Americans with Disabilities Act, the Civil Rights Act of 1991,
the Connecticut human rights and opportunities law or any other
federal, state, local or common law, or pertaining or relating in
any manner to Employee's employment with the Company, the end of
Employee's employment with the Company or any alleged conduct
following Employee's separation from employment to the date this
Agreement is executed by Employee. Employee agrees that Employee
has been paid any accrued and unused vacation and has received all
pay and benefits from the Company to which Employee is entitled
under any federal, state or local wage and hour or other law.
Further, Employee agrees and avers that the foregoing Full and
General Release is made by Employee voluntarily, knowingly and
without coercion.
5. Release by Company.
(a) The Company hereby releases and forever discharges
Employee, and Employee's agents, assignees, executors, heirs and
representatives, from any and all actions, attorneys' fees, causes
of action, claims, controversies, costs, covenants, damages, debts,
demands, fees, grievances, suits, sums of money or other
obligations which have arisen or may arise on or before the date
this Agreement is executed by the parties whether in law, at equity
or otherwise under any common law, statute, regulation, ordinance,
or executive order, except any claim which may arise under this
Agreement. The Company agrees and avers that the foregoing Full
and General Release is made by the Company voluntarily, knowingly
and without coercion.
(b) Employee warrants and represents that he has taken no
action prior to the execution of this Agreement in violation of
Sections 6 or 8 of the Employment Agreement or Sections 6 or 7 of
this Agreement.
6. Confidential Information.
(a) Employee affirms and acknowledges that the information,
observations and data obtained by Employee during the course of
Employee's employment with the Company and Affiliates are the sole
property of the Company and Affiliates. Employee agrees that from
the date of this Agreement and thereafter, without the express
written consent of the Board, Employee will not disclose to any
person or entity or use for Employee's own account or for the
benefit of any third party any Confidential Information, unless and
only to the extent that such Confidential Information becomes
generally known to and available for use by the public or in the
trade other than as a result of the Employee's acts or omissions to
act or the wrongful act of any third party. "Confidential
Information" includes, without limitation, the Company's and
Affiliates' trade secrets; the names, addresses or particular
desires or needs of the Company's and Affiliates' customers; the
bounds of the Company's and Affiliates' markets; the prices charged
for their services or products and the methods and formulas related
to pricing; information concerning potential acquisitions, business
plans, and future product or market developments; financial
information; information regarding suppliers and costs of products
and other supplies; financing programs; and information regarding
personnel, overhead, distribution and other expenses. The parties
stipulate that Confidential Information and all elements of it are
important, material, confidential and gravely affect the successful
conduct of the Company's and Affiliates' business.
(b) Employee represents that Employee has delivered to the
Company all memoranda, notes, plans, records, reports, computer
disks and memory, and other documentation (and copies thereof)
relating to the business of the Company and Affiliates or which
contain Confidential Information however stored or recorded which
Employee possessed or had under Employee's control, and all of the
Company's and Affiliates' keys, credit cards and other property in
his possession or control. The Company agrees to provide to
Employee reasonable access to obtain files which he brought with
him when he became employed by the Company, provided that the
Company may make copies of any such files which Employee removes
from Company premises.
7. Restrictive Covenant.
(a) Employee agrees that through July 31, 1999 ("Restrictive
Period"), he will not on his own behalf or on behalf of any other
person or entity, without the express written consent of the
Company's Board, solicit, induce or attempt to solicit or induce
any then current employee, representative or service provider of
the Company and Affiliates or to terminate or modify his, her or
its employment or business relationship with the Company or any of
the Affiliates.
(b) Employee also agrees that during the Restrictive Period,
he will not on his own behalf or on behalf of any other person or
entity, without the express written consent of the Board, solicit,
induce or attempt to solicit or induce any current client of the
Company or any of the Affiliates (see Exhibit B attached hereto for
a list of current clients) to terminate or modify its use of the
Company's or any of the Affiliates' services.
(c) Employee agrees that the covenants contained in Section
6 and 7 of this Agreement are reasonable in scope, area and
duration and are necessary to protect the Company's or the
Agencies' Confidential Information and their relationships with
their clients. In the event of an actual, attempted or
contemplated breach of Section 6 or 7, the Company shall be
entitled to injunctive relief in addition to any legal or other
remedies it may have.
(d) Without limiting any of its rights as provided elsewhere
in this Section 7, the Company agrees to waive any rights it may
have pursuant to the restrictive covenant set forth in Section 6 of
the Employment Agreement.
8. Severability and Modification.
(a) If any provision of this Agreement is declared void,
unenforceable or against public policy, such provision shall be
deemed severable and severed from this Agreement and the balance of
this Agreement shall remain in full force and effect.
(b) If a court of competent jurisdiction rules that any
restriction of this Agreement is overbroad or unreasonable, the
court shall modify or revise such restriction to include the
maximum reasonable restriction allowed by law.
9. Contractual Capacity. The parties agree that each has
entered into this Agreement knowingly and voluntarily. By signing
this Agreement, Employee states that Employee has read it and
understands it. Employee further states that, by this Agreement,
Employee has been advised in writing to consult with an attorney
prior to executing this Agreement, and that Employee has at least
21 days during which to consider this Agreement prior to signing
it.
10. Indemnification. Employee agrees not to make, assert or
maintain any charge, claim or demand which is released by this
Agreement. If Employee breaches this provision, Employee agrees to
indemnify the Company, the Affiliates and Released Parties and hold
it and them harmless against all liability, costs and expenses,
including attorneys' fees, incurred due to such breach.
11. No Disparaging Remarks. Employee agrees that Employee
will not disparage the Company or any of the Affiliates or Released
Parties, by written or oral word, gesture, or any other means, nor
will Employee make any disparaging or negative comments about the
Company or any of the Affiliates and Released Parties to any person
or entity. The Company agrees that its officers and directors will
not make any disparaging or negative comments about Employee.
12. Reference Letter. The Company will respond to all
requests which it receives for an employment reference regarding
Employee in writing confirming dates of employment and last
position held.
13. Press Release. The Company agrees to distribute a press
release the text of which is set forth in Exhibit C regarding
Employee's resignation.
14. Non-Admission. The parties agree and acknowledge that
the considerations exchanged in this Agreement do not constitute
and shall not be interpreted as constituting any admission or
liability on the part of the Company for any violation of common
law or any local, state or federal statute, regulation, executive
order or law.
15. Entire Agreement. This Agreement contains all the terms
and conditions agreed upon by the parties and the terms and
conditions contained herein supersede any previous agreement or
arrangement between the parties; provided however, that the Options
Agreements between the parties shall remain in full force and
effect as provided in Section 3 above. No provision expressed
herein may be altered, modified and/or canceled except upon the
express, written consent of the parties. This Agreement may be
executed in one or more counterparts, each of which being
enforceable against the party signing such counterpart but together
constituting one agreement.
16. Governing Law. This Agreement shall be governed by the
laws of the State of Connecticut.
17. Arbitration. Except for the Company's rights to
damages and/or injunctive relief relating to claims under Sections
6 and 7 of this Agreement, any disputes or disagreements between
the parties shall be submitted to arbitration. If the parties are
unable to agree upon an arbitrator within seven days after notice
of any such claim from either party, an arbitrator shall be
selected from a panel furnished by the American Arbitration
Association ("AAA") in accordance with its labor and employment
arbitration procedures. Such arbitration shall take place at the
AAA office closest to the Company corporate offices or a location
mutually acceptable to the parties. The award of the arbitrator
shall be final and binding upon all parties. The arbitrator shall
have no authority to order specific performance or to add to,
subtract from or modify this Agreement, but shall have the
authority only to interpret this Agreement. The arbitrator's fee
and other common expenses of the arbitration shall be borne equally
by the parties, except that each party shall be responsible for its
own attorney's fees.
18. Effective Date. It is hereby agreed that Employee has a
period of seven days commencing on the first day after Employee has
executed this Agreement during which Employee may revoke this
Agreement. Notice of such revocation must be personally delivered
or sent next day overnight delivery by a reliable carrier to Xxxxx
XxXxxx, Competitive Technologies, Inc., 0000 Xxxxxxx Xxxx,
Xxxxxxxxx, Xxxxxxxxxxx 00000. This Agreement shall become
effective on the first day following expiration of this seven-day
period ("Effective Date").
XXXXXX X. XXXXXXX ("Employee") COMPETITIVE TECHNOLOGIES, INC.
("Company")
s/ Xxxxxx X. Xxxxxxx By: s/ Xxxxx X. XxXxxx, Xx.
Title: Vice President & CFO
Date: 10/15/98 Date: 10/15/98
