Separation Agreement - Youbet.com Inc. and Russell Fine
SEPARATION AGREEMENT
This Separation Agreement (the "Agreement") is made by and between
Youbet.com, Inc. (the "Company") and Russell Fine (the "Employee"). This
Agreement is made in light of the following facts:
A. Employee has resigned his employment and directorships with the
Company effect May 3, 2000. Employee and the Company seek to obtain a full and
final resolution of all potential claims, known and unknown, related to
Employee's employment with the Company and the conclusion of that employment.
B. Nothing contained in this Agreement, nor the payment of any
consideration shall be taken or construed to be an admission or concession of
any kind by the Company that it has engaged in any wrongdoing. In fact, the
Company expressly denies any liability or wrongdoing in its treatment of the
Employee.
C. Nothing contained in this Agreement, shall be taken or construed to
be an admission or concession of any kind by the Employee that he has engaged in
any wrongdoing. In fact, the Employee expressly denies any liability or
wrongdoing with respect to the performance of services for the Company.
In consideration of the terms and conditions contained herein, the
parties agree as follows:
1. RESIGNATION OF EMPLOYMENT AND OFFICES. Employee hereby
irrevocably resigns his employment and directorships with the Company and the
Company accepts Employee's resignation, effective at the close of business on
May 3, 2000 (the "Effective Date"). Within five (5) days of the execution of
this Agreement, the Company shall pay all accrued, but unpaid salary and unused
vacation time. The remaining portion of the $300,000 bonus approved in 1999
which is unpaid (which amounts up to $150,000) will be paid if and when the
bonus performance criteria are satisfied.
2. SEVERANCE PAYMENTS. For a period of three (3) years
commencing on the Effective Date (the "Severance Period"), the Company will pay
to the Employee (and, in the event of his death, his estate) an annual severance
salary of $182,500 during the Severance Period, payable twice monthly in equal
installments. The Company agrees that its obligations to make these payments are
independent of any other provision of this Agreement, other than Sections 7 and
9.
3. CONSULTING SERVICES. For a period of three (3) years
commencing on the Effective Date (the "Consulting Term"), Employee will render
such consulting services to the Company as may be agreed by the Employee and the
Company's chief executive officer or his designee. Employee shall make himself
reasonably available for up to fifteen (15) days of each twelve (12) month
period of the Consulting Term to render such services. Such services shall be
rendered at the time and place elected, in his reasonable discretion, by the
Employee in consultation with the Company. Employee agrees that the initial
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fifteen (15) days of each twelve (12) month period commencing on the Effective
Date shall be at no charge to the Company. If during any such twelve (12) month
period the Employee and the Company agree that consulting services in excess of
fifteen (15) days will be rendered, then such additional services will be
rendered at the rate agreed to by the Company and the Employee. In performing
the consulting services hereunder, Employee shall report directly to the
Company's chief executive officer or his designee, and Employee agrees to
refrain from initiating contact with other employees, agents, customers,
suppliers and vendors of the Company except as such contacts are expressly
authorized or directed by the Company.
4. CONTINUATION OF BENEFITS. The Company will maintain during
the Severance Period Employee's employee benefits as described in Section 5
(without giving effect to the last paragraph thereof) of the Employment
Agreement dated June 29, 1998 between the Employee and the Company (the "Prior
Agreement').
5. OWNERSHIP OF CERTAIN PROPERTY. Employee shall be entitled
to retain possession of the laptop computer and the computer equipment
(including the Microsoft Office, Provision Work Bench and Microsoft Developer
Network Enterprise software licenses) and peripherals personally used by him at
his home during the course of his employment. Except as set forth above, or as
may necessary for Employee to render consulting services pursuant to Section 3
hereof, Employee agrees to delete from any such computer equipment and
peripherals all information, software, programs and data that is the property of
or proprietary to the Company.
6. WAIVER OF BOARD REPRESENTATION. Employee hereby irrevocably
and permanently waives all rights to (i) serve as a member of the Company's
board of directors and the Executive Committee thereof, and (ii) to designate a
director to serve on the Company's board of directors, each as may be provided
pursuant to Section 1.1 of the Stockholder's Agreement dated as of June 29,
1998, by and between Employee and the Company, among others.
7. RELEASE AND WAIVER OF CLAIMS BY EMPLOYEE. Employee waives
and releases any and all actual or potential claims, demands, causes of action,
damages and liabilities, of whatever kind or nature, known or unknown, suspected
or unsuspected, which Employee now has or holds, or at any time had or held
against the Company, related corporations, subsidiaries, and their officers,
directors, employees or agents, in any manner attributable to Employee's
employment by the Company or the cessation thereof. This waiver and release
expressly waives any and all claims arising out of such employment and the
cessation thereof that Employee may have against the Company regardless of the
nature, source, or basis for any such claim, including, but not limited to, any
contract or tort claims, employment discrimination of any kind or nature, breach
of the covenant of good faith and fair dealing, termination in violation of
public policy, defamation, claims arising under Title VII or the Civil Rights
Act, the Americans with Disabilities Act, the Age Discrimination in Employment
Act of 1967, the Older Workers Benefit Protection Act of 1990, and the Fair
Labor Standards Act, or any similar state statute or principle of common law.
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8. RELEASE AND WAIVER OF CLAIMS BY THE COMPANY. The Company
waives and releases any and all actual or potential claims, demands, causes of
action, damages and liabilities, of whatever kind or nature, known or unknown,
suspected or unsuspected, which the Company now has or holds, or at any time had
or held against the Employee, attributable to or arising out of his prior
relationship with the Company as an Employee or Director including but not
limited to any claims it may have under any other federal, state or local
Constitution, Statute, Ordinance and/or Regulation and/or those arising under
common law including but not limited to tort, express and/or implied contract
and/or implied contract, arising out of or, in any way, related to the
Employee's employment with the Company; provided, however, that this release and
waiver by the Company shall not extend to any claim against Employee based on
any act of fraud, theft, conversion or embezzlement by Employee. The Company
agrees that if the Employee is made a party or is threatened to be made a party
to any action, suit or proceeding, whether civil, criminal, administrative or
investigative (hereinafter a "Proceeding"), by reason of the fact that he is or
was a director or officer of the Company, including service with respect to
employee benefit plans, whether or not the basis of such Proceeding is alleged
action in an official capacity as a director, officer, employee or agent while
servicing as a director, officer, employee or agent, he shall be indemnified and
held harmless by the Company to the fullest extent authorized by applicable law
against all expense, liability and loss (including attorneys' fees, judgment,
fines, ERISA excise taxes or penalties and amounts paid or to be paid in
settlement) reasonably incurred or suffered by the Employee in connection
therewith; provided, however, (a) written notice of such Proceeding is given
promptly to the Company by the Employee, (b) the Company is permitted to
participate in and coordinate the defense of such Proceeding, and (c) such
liability results from the final judgment of a court of competent jurisdiction,
or, as a result of a settlement entered into with the prior written consent of
the Company or is required (i) by such court as a bond, payment into escrow or
similar payment, or (ii) otherwise to forestall imminent attachment or similar
process against any of the Employee's assets. The right to indemnification
conferred herein shall include the right to be paid by the Company the expenses
incurred in defending any such Proceeding in advance of its final disposition,
including without limitation attorney fees or other costs of defense. The
Company shall be under no obligation to indemnify the Employee with respect to
any act or acts of the Employee: (i) in a knowing violation of any written
agreement between Employee and the Company; (ii) for which a court, having
jurisdiction in the matter, determines that indemnification is now lawful; or
(iii) which a court, having jurisdiction in the matter, determines to have been
knowingly and fraudulently committed by the Employee or which is the result of
willful misconduct by the Employee. If a claim for indemnification is not paid
in full by the Company within sixty (60) days after a written claim has been
received by the Company, the Employee may at any time thereafter bring suit
against the Company to recover the unpaid amount of the claim.
9. RELEASE OF UNKNOWN CLAIMS. The parties acknowledge that
this is a full and final release of all claims covered by Sections 7 and 8 and
that the Parties intend and expressly agree that this Agreement shall be
effective as a bar to each and every such claim, demand or cause of action that
may exist as of the Effective Date. The parties also expressly waives any and
all rights and benefits conferred under the terms of California Civil Code
Section 1542, which provides as follows:
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"A general release does not extend to claims which the
creditor does not know or suspect 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. NONDISCLOSURE. The Parties shall not disclose the nature
or terms of this Agreement or the negotiations that led to this Agreement to any
person or entity, other than Employee's spouse, David Marshall, the parties tax
advisors or counsel, the Company's officers and directors without the written
consent of the other party, unless required to do so by law.
11. NONDISPARAGEMENT. During the Severance Period Employee
agrees to refrain from making any disparaging, negative or uncomplimentary
statements, whether public or private, regarding the Company, any related
companies and/or any officers of the Company or related companies. The Company,
for its part, agrees to refrain (and to cause its officers to refrain) from
making any disparaging, negative or uncomplimentary statements, whether public
or private, regarding the Employee during the Severance Period.
12. CONFIDENTIALITY OF COMPANY INFORMATION. Without the prior
written consent of the Company's chief executive officer, Employee will not (a)
make use of or disclose in any way (except as otherwise required by law),
confidential, proprietary or trade secret information belonging to the Company
or its affiliated or related companies or (b) at anytime during the Severance
Period, solicit or make any employment proposal to any Company employee or
personnel, or cause the employment of any Company employee or personnel.
13. LIMITED REFERENCES. The Company agrees to respond to
inquiries from prospective employers of Employee with a neutral reference
consisting of three pieces of information: (1) Employee's dates of employment;
and (2) Employee's job title of Executive Vice President, Chief Technology
Officer and Director; and (3) Employee's work on a non-exclusive consulting
basis effective as of the Effective Date. The Company will also respond that it
is against Company policy to comment further on the qualifications or
performance of any present or former employees.
14. ADVICE OF COUNSEL. Employee acknowledges that he has been
advised to consult an attorney prior to executing this Agreement and that he has
had an opportunity to discuss this Agreement with his counselor and other
advisors and that he understands this Agreement and signs it voluntarily.
15. AFFILIATE STATUS. The Company, after ninety days of the
execution of this Agreement and based on a legal opinion to be provided by the
Employee's counsel, shall remove all restrictive stock legends from shares of
the Company that are owned by the Employee upon Employee's written request to do
so, which written request shall contain the representations of Employee
reasonable deemed necessary by the Company's counsel to comply with all
applicable securities laws.
16. ENTIRE AGREEMENT. Except as set forth in this Agreement,
this Agreement is the total Agreement of the parties and replaces any prior
negotiations or agreements between the parties whether oral or written.
Notwithstanding the preceding sentence, the provisions set forth in Sections
7.2, 7.3 and 8.3 of the Prior Agreement shall survive this Agreement.
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17. SEVERABILITY/EXECUTION. Should any court of law find any
term or clause of this Agreement invalid or unenforceable under applicable law,
then such term or clause shall be omitted from enforcement, with all other terms
and conditions remaining valid and enforceable. This Agreement may be executed
in counterparts, each of which will be deemed an original and which together
will be a single instrument.
Dated: 5/5/00 /S/ RUSSELL FINE
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RUSSELL FINE
YOU BET.COM, INC.
Dated: 5/5/00 By: PHILIP HERMAN
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Its: EVP & CEO
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