Severance Agreement and Release of All Claims - First Virtual Holdings Inc. and John M. Stachowiak
SEVERANCE AGREEMENT AND RELEASE OF ALL CLAIMS
This Agreement to Change Status and Release all Claims ("Agreement") is
made between First Virtual Holdings Incorporated (EMPLOYER) and John M.
Stachowiak (EMPLOYEE) in the complete, final, and binding settlement of all
claims and potential claims, if any, with respect to their employment
relationship. This agreement shall be effective May 15, 1998 ("Effective Date").
Whereas, Employer has verbally informed Employee that it desires to terminate
Employee's employment as of the Effective Date, but to ask Employee to consult
thereafter.
Whereas, Employer will provide Employee with:
(i) a payment equal to four (4) months salary;
(ii) accelerated vesting of 25% of the total of options to purchase First
Virtual Common Stock held by Employee, as of the Effective Date; and
(iii) an extension of time to exercise those vested options until May 15, 1999.
The parties have agreed as follows:
All disputes, controversies, and potential disputes or causes of action or
claims arising out of, or in any way connected with, Employee's employment
relationship with Employer, whether known or unknown, suspected or unsuspected,
which the Employee and Employer, its shareholders, officers, assigns, and
agents, has or may have had against each other are settled.
1. Employee resigns as Vice President, Finance and Administration and Chief
Financial Officer as of the Effective Date. The parties acknowledge that
Employee is no longer a SEC Section 16 officer as of the Effective Date.
2. Employee represents and warrants, that to the best of his knowledge and
belief that nothing stated in the Registration Statement on Form S-1 filed with
the Securities and Exchange Commission relating to Employer's initial public
stock offering or the Employer's Form 10K filed for fiscal years 1996 and 1997
or the Employer's Form 10Q filed for first, second, third or fourth quarter of
1997, or the Employer's Form 10Q filed for first quarter of 1998 ("SEC
Filings") was false or inaccurate as of the date of such SEC Filings or failed
to state a fact that when considered in light of all facts and circumstances
would be considered material.
3. Employer will pay to Employee the total amount of $18,168.17 representing
salary earned and unpaid through May 15, 1998, vacation pay earned and unused
through May 15, 1998, net of applicable withholdings, and a refund of moneys
paid into the Employee Stock Purchase Plan. Employee agrees and understands
that this payment and transfer is a full satisfaction of any wages earned, but
unpaid to date and waives any right under California Labor Code Section 206.5.
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4. Employer will also pay Employee an additional amount of $66,666.64
representing four (4) months salary, net of applicable withholdings. Employee
will be paid his current salary on the May 31, 1998 and June 15, 1998 and the
gross amount will be subtracted from the total $66,666.64. On June 30, 1998
Employer will pay Employee the remaining amount of the $66,666.64, net of
applicable withholdings.
5. As of the Effective Date, subject to approval by the Company's Board of
Directors, the options to purchase Common Stock held by Employee shall be
exercisable as to the number of shares set forth below and the exercise period
will be extended to 1 (one) year from the Effective Date of this Agreement for
all previously existing Option Grants. Employer and Employee agree that as of
the Effective Date, the Employee is vested in the following options:
Vesting
Commencement Vested and
Date Option Date Type Granted Price Exercisable
-------------------------------------------------------------------------
10/14/96 8/15/97 NSO 10,000 $1.00 6,458
10/14/96 4/29/98 ISO 45,000 $0.9375 29,063
10/14/96 4/29/98 ISO 25,000 $0.9375 25,000
8/12/96 4/29/98 ISO 100,000 $0.9375 68,750
TOTAL EXERCISABLE: 129,271
6. The President of the Company Keith S. Kendrick and Lee H. Stein, Chairman
and CEO are the only persons currently employed by Employer authorized to
provide a reference concerning Employee. Employer may at its discretion provide
the reference only after receiving an authorized consent or request signed by
Employee identifying the authorized inquirer.
7. The events leading to this Agreement and Release, the fact of the
Agreement and Release, and the terms and conditions of the Agreement and
Release are and shall be maintained in privacy and confidence. Both parties
agree that this confidentiality is a material term of the Agreement and Release.
Without waiving their agreement concerning confidentiality, the parties agree
that the information regarding the monetary terms of this settlement may be
disclosed to any state or federal taxing authority and in filing; with the
Securities and Exchange Commission as required by law. Such disclosure shall not
be deemed a breach of this Agreement. Nothing in this paragraph is intended to
restrict Employee from communicating with prospective employers and job referral
sources about Employee's job experience at First Virtual, the nature and extent
of job responsibilities, level of performance, the dates of employment, and the
fact that Employee's termination resulted from a reorganization of Employer and
that this termination was not performance related. Both Employee and Employer
agree that they will do nothing to disparage the other in any communications
after the date of this Agreement.
8. The parties further agree that:
Employee is eligible to participate in the Professional Management Program,
provided by Right Management Consultants, and that the Company will pay the
cost of such Program in an amount not to exceed $7,500.
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8.1 Each party acknowledges complete satisfaction of, and does hereby forever
release, absolve, and discharge the other including but not limited to its
parent corporation(s), subsidiaries, shareholders, officers, trustees,
employees, past and present, successors, predecessors, assigns, agents,
attorneys, and representatives from any and all causes of action judgments,
liens indebtedness, damages, claims, liabilities, and demands, and causes of
action of whatever kind or nature (except for Employee's right to unemployment
insurance should Employee fail to obtain re-employment after the termination of
this agreement) whether known or unknown, suspected or unsuspected, which the
parties now have or hold, or at any time has or held against the other its
parent corporation(s), subsidiaries, shareholders, officer, trustee, employees,
past and present, successors, predecessors, assigns and agents including, but
not limited to, any and all claims, under federal, state or local laws
prohibiting discrimination in employment (including but not limited to the Age
Discrimination in Employment Act of 1967), wrongful termination, breach of
contract, breach of public policy, or any other claims. This release expressly
waives any and all claims each party may presently have against the other
regardless of the nature, source, or basis for any such claim. Employee agrees
and promises not to file any lawsuit or other action asserting any such claims.
8.2 Without expanding or modifying same, Employee acknowledges its continuing
obligations under its letter provided Employee, dated October 9, 1996 about
certain rights of indemnification.
8.3 Employee represents and warrants that he has either destroyed or delivered
to Employer all documents and information in any media either provided Employee
by Employer or developed by Employee during his employment. Employee
acknowledges and reaffirms his obligations under the Employee Confidentiality
and Invention Assignment Agreement dated October 14, 1996, which shall be
considered a part of this Agreement.
9. The Parties may in the future discover facts different from or in addition
to those which are the subject of this Agreement, and agree that this Agreement
shall remain in effect in all respects, notwithstanding the discovery or
existence of different or additional facts. It is the intent of the Parties to
completely, finally, irrevocably, and forever release, forgive, remise, acquit,
and discharge the matters as provided herein; and in furtherance of this
intention, this Agreement shall remain in effect as a complete and final
release, forgiveness, and discharge of those matters, notwithstanding the
discovery or existence of different or additional facts relevant to those
matters. Therefore, the Parties waive all rights and benefits which they may now
have or in the future may have under and by virtue of the terms of Section 1542
of the California Civil Code, which reads 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.
10. Employee and Employer each acknowledge that they have carefully read and
understand the contents of this Agreement and that this Agreement constitutes
the entire agreement and understanding of the parties. The parties further agree
that the terms of this Agreement are contractual and that both parties, their
heirs, successors, and assigns are bound by it, and that any dispute as to its
terms or its interpretation is governed by laws of the state of California
excluding its conflict of laws doctrine.
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Should any court of law find any term or clause invalid under the prevailing
law, then that term or clause only shall be omitted from enforcement, all other
terms and conditions remaining enforceable.
11. Employee acknowledges complete satisfaction of, and does hereby forever
release, absolve, and discharge Employer, including but not limited to its
parent corporation(s), subsidiaries, shareholders, officers, trustees,
employees, past and present, successors, predecessors, assigns, agents,
attorneys, and representatives from any and all causes of action related to the
Age Discrimination in Employment Act (ADEA). Employee understands:
- That Employee has at least 45 days to review and execute this release
and to review information provided by the Company regarding all employment
terminations occurring on or around the same time as the termination of
Employee's employment; and
- That Employee will have 7 days after executing this release to revoke
the release; and,
- That Employee is advised to consult with an attorney before executing
this release; and;
- Any revocation shall be in writing and shall be delivered to the
President by the close of business on the seventh business day from the
date Employee signs this agreement
12. This is the complete integration of the agreement between the Parties and
supersedes any oral, written or other representation made prior to or
simultaneous to the execution of this Agreement. If any of the provisions of
this Agreement are found by a court or other authority of competent
jurisdiction to be unenforceable, then that provision(s) shall be stricken from
this Agreement and the remaining provisions will continue in full force and
effect.
/s/ JOHN M. STACHOWIAK
-------------------------------------
John M. Stachowiak
Date: May 18, 1998
First Virtual Holdings Incorporated
/s/ KEITH S. KENDRICK
-------------------------------------
Keith S. Kendrick
Its President
Date: 15 May 1998
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