Separation Agreement and General Release - LifeMinders Inc. and Stephen R. Chapin Jr.
SEPARATION AGREEMENT
AND GENERAL RELEASE
This Separation Agreement and General Release ("Agreement") is made
and entered into this 2nd day of February, 2001, by and between LifeMinders,
Inc. (hereinafter the "Company" or "Employer") and Stephen R. Chapin, Jr.
("Executive") (hereinafter collectively referred to as the "Parties"), and is
made and entered into with reference to the following facts.
RECITALS
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WHEREAS, Executive serves as the Company's Chairman and Chief
Executive Officer and is a member of the Company's Board of Directors (the
"Board"); and
WHEREAS, the Company and Executive have agreed to terminate their
employment relationship effective January 29, 2001; and
WHEREAS, the Parties each desire to resolve any potential disputes
which exist or may exist arising out of Executive's employment with the Company
and/or the termination thereof.
NOW THEREFORE, in consideration of the covenants and promises
contained herein, the Parties hereto agree as follows:
AGREEMENT
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1. Agreement By the Executive. In exchange for the payments
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described in paragraph 2 below, Executive:
(a) Agrees to, and hereby does, resign as Chairman, Chief
Executive Officer and as a Board member and from any other
position held by Executive in the Company effective January
29, 2001 (hereinafter the "Resignation Date");
(b) Agrees to, and hereby does, surrender to the Company options
to purchase 901,428 shares of common stock of the Company
which have been granted to Executive and which have not been
exercised; and
(c) Agrees to be bound by the terms of this entire Agreement.
2. Agreement By the Company. In exchange for Executive's agreement
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to be bound by the terms of this entire Agreement, including but not limited to
the Release of Claims in paragraph 3, and contingent upon Executive's continuing
compliance with his obligations under this Agreement during the period set forth
below, the Company agrees to provide Executive:
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(a) Continuation of Executive's base salary, at the rate in
effect on the Resignation Date, less statutory deductions
and withholdings, for a period of twelve (12) months after
the Resignation Date, to be paid in accordance with the
Company's regular pay cycle commencing upon Company's
receipt of this Agreement fully executed by Executive;
(b) An amount equal to Executive's base salary, at the rate in
effect on the Resignation Date, less statutory deductions
and withholdings, for a period of six (6) months, to be paid
in one lump sum as soon as practicable after Company's
receipt of this Agreement fully executed by Executive; and
(c) Continuation of health benefits paid fully by the Company
via COBRA for Executive and Executive's dependents who are
covered under the Company's group health benefits, on
substantially the same terms and conditions as existed on
the Resignation Date, for a period of twelve (12) months
after the Resignation Date.
Executive acknowledges that, absent this Agreement, he has no legal,
contractual or other entitlement to the consideration set forth in this
paragraph and that the amount set forth in this paragraph constitutes valid and
sufficient consideration for Executive's release of claims and other obligations
set forth herein.
3. Release of Claims. Executive hereby expressly waives, releases,
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acquits and forever discharges the Company and its divisions, subsidiaries,
affiliates, parents, related entities, partners, officers, directors,
shareholders, investors, executives, managers, employees, agents, attorneys,
representatives, successors and assigns (hereinafter collectively referred to as
"Company Releasees"), from any and all claims, demands, and causes of action
which Executive has or claims to have, whether known or unknown, of whatever
nature, which exist or may exist on Executive's behalf from the beginning of
time up to and including the Resignation Date. The Company hereby expressly
waives, releases, acquits and forever discharges Executive and his agents,
attorneys, representatives, successors and assigns (hereinafter collectively
referred to as "Executive Releasees"), from any and all claims, demands, and
causes of action which the Company has or claims to have, whether known or
unknown, of whatever nature, which exist or may exist on the Company's behalf
from the beginning of time up to and including the Resignation Date. As used in
this paragraph, "claims," "demands," and "causes of action" include, but are not
limited to, claims based on contract, whether express or implied, fraud, stock
fraud, defamation, wrongful termination, estoppel, equity, tort, retaliation,
intellectual property, personal injury, spoliation of evidence, emotional
distress, public policy, wage and hour law, statute or common law, claims for
severance pay, claims related to stock options and/or fringe benefits, claims
for attorneys' fees, vacation pay, debts, accounts, compensatory damages,
punitive or exemplary damages, liquidated damages, and any and all claims
arising under any federal, state, or local statute, law, or ordinance
prohibiting discrimination on account of race, color, sex, age, religion, sexual
orientation, disability or national origin, including but not limited to, the
Virginia Human Rights Act, the Age Discrimination in Employment Act, Title VII
of the
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Civil Rights Act of 1964 as amended, the Americans with Disabilities Act, the
Family and Medical Leave Act or the Employee Retirement Income Security Act.
4. Last Date of Employment. It is understood and agreed that
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Executive's last date of employment with Employer is January 29, 2001.
5. Receipt of Wages and Other Compensation. The Company and
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Executive acknowledge that Executive is entitled to $3,750.00, less statutory
deductions and withholdings, as accrued vacation pay. The Company shall pay this
amount to Executive along with the payment to be made to Executive under Section
2(b) above. Executive acknowledges and agrees that, except as set forth in the
previous sentence, prior to his execution of this Agreement, he has received
payment for all wages, salary, bonuses, accrued vacation, and all other
compensation owed to Executive by the Company.
6. Executive Covenants.
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(a) Executive acknowledges that during his employment with the
Company, he had access to confidential and proprietary business information that
is the property of the Company, the disclosure of which could cause substantial
and irreparable harm, loss of goodwill, or injury to the Company. Executive
agrees not to disclose any such confidential or proprietary business information
without the prior written authorization of the Board. Notwithstanding the
foregoing, the parties acknowledge that Executive's obligation not to disclose
shall not apply, or shall terminate, with respect to any portion of such
business information which: (i) is in the public domain; or (ii) is required to
be disclosed under applicable law.
(b) Executive shall, as a condition of receiving any of the
payments provided for in Section 2 above, return to the Company prior to his
acceptance of this Agreement all records, including original documents and
electronically stored documents, and all copies thereof, pertaining to the
business and customers of the Company as well as any other property of the
Company in his possession, custody or control as of the Resignation Date;
provided that Executive shall be entitled to keep the following laptop computers
as his own property:
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Sony PCG-F480 28306630-3208291 10-000014
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Sony PCG-Z505HS 28305530-3107588 10-000333
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(c) For a period of twelve (12) months after the Resignation
Date, Executive shall not, without the prior written consent of the Board,
(whether as an employee, agent, servant, owner, partner, consultant, independent
contractor, representative, stockholder or in any other capacity whatsoever),
participate in any business that offers any of the following products or
services as a principal business line or as a business line in which Executive
participates and which products or services are competitive in any way to the
products or services offered by the Company or under active development by the
Company during the period of Executive's employment with the Company:
(i) third-party on-line registrations and promotions;
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(ii) e-mail newsletters and personal reminders;
(iii) outsourced e-mail newsletters;
(iv) on-line acquisition and on-line delivery of
subscription services;
(v) on-line couponing;
(vi) on-line consumer data brokering; and
(vii) on-line member acquisition services for third parties
excluding such services for off-line products with
which Executive is directly involved or of which
Executive is a principal owner.
The foregoing restrictions shall not apply to ownership by Executive of less
than a five percent (5%) beneficial interest in outstanding equity securities of
any business entity that has equity securities registered under the Securities
Exchange Act of 1934. Nothing herein shall prohibit Executive from serving on an
advisory committee for Verisign, Inc. provided that (i) Executive's obligations
under this Agreement including, without limitation, those set forth in this
Section 6(c), shall apply to Executive's service on such advisory committee and
(ii) Executive shall not advise Verisign, Inc. with respect to the disposition
by Verisign, Inc. of its domain name registrar.
(d) For a period of twelve (12) months after the Resignation
Date, Executive shall not, without the prior written consent of the Board,
directly or indirectly, entice, solicit or encourage any Company employee to
leave the employ of the Company or any independent contractor to sever its
engagement with the Company. Executive represents and warrants that Executive
has been approached by Michael Himick and that Executive has not solicited or
encouraged Mr. Himick to leave the employ of the Company and the Company hereby
acknowledges and agrees to the foregoing. The foregoing restrictions shall not
apply to Mr. Jeff Johnson.
(e) For a period of twelve (12) months after the Resignation
Date, Executive shall not, directly or indirectly, entice, solicit or encourage
any customer or prospective customer of the Company to cease doing business with
the Company, reduce its relationship with the Company or refrain from
establishing or expanding a relationship with the Company.
(f) Executive agrees that all inventions, improvements and
developments ("Developments") which he made, conceived, reduced to practice or
developed (in whole or in part, either alone or jointly with others) during his
employment with the Company shall be the sole property of the Company. Unless
the Company decides otherwise, the Company shall be the sole owner of all rights
in connection therewith. All copyright-protected Developments are and at all
times shall remain "work made for hire". Executive hereby assigns to the Company
any and all rights to any Developments, absolutely and forever, throughout the
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world and for the full term of each and every such right, including renewal or
extension of any such term.
7. Acceptance of Agreement. This Agreement was received by Executive on
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January 29, 2001. Executive may accept this Agreement by returning a signed
original to the Company. This Agreement shall be withdrawn if not accepted in
the above manner on or before February 2, 2001.
8. Non-Admission of Liability. The Company denies any wrongdoing
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whatsoever in connection with its dealings with Executive, including but not
limited to, Executive's employment and termination. Executive denies any
wrongdoing whatsoever in connection with his dealings with the Company. It is
expressly understood and agreed that nothing contained in this Agreement shall
constitute or be treated as an admission of any wrongdoing or liability on the
part of the Company or Executive.
9. No Filing of Claims. Executive represents and warrants that he does
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not presently have on file, and further represents and warrants that he will not
hereafter file, any claims, charges, grievances or complaints against any of the
Company Releasees (defined above) in or with any administrative, state, federal
or governmental entity, agency, board or court, or before any other tribunal or
panel or arbitrators, public or private, based upon any actions or omissions by
the Company Releasees occurring prior to the date of this Agreement. The Company
represents and warrants that it does not presently have on file, and further
represents and warrants that it will not hereafter file, any claims, charges,
grievances or complaints against any of the Executive Releasees (defined above)
in or with any administrative, state, federal or governmental entity, agency,
board or court, or before any other tribunal or panel or arbitrators, public or
private, based upon any actions or omissions by the Executive Releasees
occurring prior to the date of this Agreement
10. Ownership of Claims. Executive represents and warrants that he is the
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sole and lawful owner of all rights, title and interest in and to all of
Executive's released matters, claims and demands referred to herein. Executive
further represents and warrants that there has been no assignment or other
transfer of any interest in any such matters, claims or demands that he may have
against the Company Releasees. The Company represents and warrants that it is
the sole and lawful owner of all rights, title and interest in and to all of the
Company's released matters, claims and demands referred to herein. The Company
further represents and warrants that there has been no assignment or other
transfer of any interest in any such matters, claims or demands that he may have
against the Executive Releasees
11. Confidentiality. Executive understands and agrees that this Agreement
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and the matters discussed in negotiating its terms are entirely confidential. It
is therefore expressly understood and agreed that Executive will not reveal,
discuss, publish or in any way communicate any of the terms, amount or fact of
this Agreement to any person, organization or other entity, with the exception
of his immediate family members and professional representatives, unless
required by subpoena or court order, in which case Executive will give the
Company written notice of such subpoena or court order upon receiving notice of
it. Executive further agrees that he will not, at any time in the future, make
any statements to any third parties that disparage any of the Company Releasees
personally or professionally. The
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Company agrees that it will not, at any time in the future, make any statements
to any third parties that disparage any of the Executive Releasees personally or
professionally. Executive and the Company will agree in good faith on the
contents of a public statement regarding Executive's resignation and the Parties
agree that they shall not make any statements to third parties regarding
Executive's resignation that are inconsistent with the agreed-upon public
statement.
12. Tax Indemnification. It is understood and agreed that Executive is
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liable for all tax obligations, if any, with respect to the settlement payments
provided for herein. Executive agrees to indemnify, defend and hold harmless
Employer from any and all taxes, assessments, penalties, loss, costs, attorneys'
fees, expenses or interest payments that Employer may at any time incur by
reason of any demand, proceeding, action or suit brought against Employer
arising out of or in any manner related to any local, state or federal taxes
allegedly due from Executive in connection with this Agreement.
13. Virginia Law Applies. This Agreement, in all respects, shall be
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interpreted, enforced and governed by and under the laws of the Commonwealth of
Virginia. Any and all actions relating to this Agreement shall be filed and
maintained in the federal and/or state courts located in the Commonwealth of
Virginia, and the parties consent to the jurisdiction of such courts. In any
action arising out of this Agreement, or involving claims barred by this
Agreement, the prevailing party shall be entitled to recover all costs of suit,
including reasonable attorneys' fees.
14. Successors and Assigns. The Parties expressly understand and agree
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that this Agreement, and all of its terms, shall be binding upon their
representatives, heirs, executors, administrators, successors and assigns.
15. Consultation with Counsel. Executive acknowledges that he has been
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advised to consult with legal counsel of his choice prior to execution and
delivery of this Agreement.
16. Integration. Except as otherwise specifically provided for, this
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Agreement constitutes an integrated, written contract, expressing the entire
agreement between the Parties with respect to the subject matter hereof. In this
regard, Executive represents and warrants that he is not relying on any promises
or representations that do not appear written herein. Executive further
understands and agrees that this Agreement can be amended or modified only by a
written agreement, signed by all of the Parties hereto.
17. Counterparts. This Agreement may be executed in separate counterparts
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and by facsimile, and each such counterpart shall be deemed an original with the
same effect as if all Parties had signed the same document.
18. Headings. The headings in each paragraph herein are for convenience of
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reference only and shall be of no legal effect in the interpretation of the
terms hereof.
19. Severability. If any provision in this Agreement is held to be
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invalid, the remainder of this Agreement shall not be affected by such a
determination.
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20. Voluntary Agreement. EXECUTIVE UNDERSTANDS AND AGREES THAT HE MAY BE
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WAIVING SIGNIFICANT LEGAL RIGHTS BY SIGNING THIS AGREEMENT, AND REPRESENTS THAT
HE HAS ENTERED INTO THIS AGREEMENT KNOWINGLY AND VOLUNTARILY, WITH A FULL
UNDERSTANDING OF AND IN AGREEMENT WITH ALL OF ITS TERMS.
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on
the dates provided below.
DATED: LIFEMINDERS, INC.
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By: /s/ Jonathan B. Bulkeley
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Its: CEO
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DATED: February 2 2001 STEPHEN R. CHAPIN, Jr.
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/s/ Stephen R. Chapin, Jr.
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