Exhibit 10.19
AGREEMENT AND
GENERAL RELEASE
Agreement and General Release
("Agreement"), by and between Devereux Chatillon ("Employee" or
"you") a resident of the City of New York and Scholastic Inc. (the
"Company").
1. You acknowledge that effective November 30, 2008 (the
“Resignation Date”), you shall resign your position as
an Officer of Scholastic Inc. and Scholastic Corporation and your
position as Senior Vice President, General Counsel and Secretary.
You shall also, as of the Resignation Date or as soon as
practicable thereafter, resign your positions, if any, as a
director and/or officer of any subsidiaries or affiliates of the
Company. After the Resignation Date, you shall not represent
yourself as being an officer of the Company for any purpose.
Following the Resignation Date, you shall continue your employment
with the Company from December 1, 2008 through May 31, 2009 unless
sooner terminated as provided herein (the “Employment
Period”). On the last day of the Employment Period (the
“Separation Date”), your employment with the Company
shall terminate. After the Separation Date, you shall not represent
yourself as being an employee, officer, agent, or representative of
the Company for any purpose. The Separation Date shall be the
termination date for purposes of participation in and coverage
under all benefit plans and programs sponsored by or through the
“Company Entities” (as hereinafter defined), except as
specified in paragraph 2 below. You acknowledge and agree that the
Company Entities shall have no obligation to rehire you, or to
consider you for employment, after the Separation Date. You
acknowledge that the representations in this paragraph constitute a
material inducement for the Company to provide the payment(s) to
you pursuant to paragraphs 2 and 3 of this Agreement.
2. Following the Effective Date (as defined in paragraph 19 of
this Agreement) and in exchange for your waiver of claims against
the Company Entities and compliance with the other terms and
conditions of this Agreement, the Company agrees:
(a) That you shall continue
your full-time employment with the Company on special assignment
through the end of the Employment Period. Your title shall be
Special Counsel and you shall report directly to, and shall be
subject to the direction and control of, the General Counsel of the
Company. Your duties will be to advise the General Counsel and his
designees about matters on which you worked prior to the
Resignation Date, to assist in the transition of your
pre-resignation responsibilities, to provide legal advice on
intellectual property matters, and to otherwise provide such legal
and other advice or services in connection with such other matters
as the General Counsel may request from time to time. You shall
continue to receive your current base salary through the end of the
Employment Period at the rate in effect on the date of this
Agreement. During the Employment Period, business expenses,
including the expense of your continuing use of your Blackberry,
laptop, and related services, will be handled, or reimbursed in
accordance with Company policy. In the event that you commence
employment with another entity prior to May 31, 2009, the
Employment Period shall terminate on that date, the Separation Date
for purposes of this Agreement shall be the date you commence
employment with such other entity, and your salary and
participation in the Company’s benefits and compensation
plans and programs shall cease on such date.
(b) That you will continue
to be eligible to participate in the Company 401(k) plan, pension
plan, group insurance, and flexible spending account through the
end of the Employment
1
Period. Deductions will be made from your
salary for any elective or required employee contributions.
(c) To pay you $200,000,
less tax withholdings and applicable deductions, in a lump sum
within fifteen (15) days of the Effective Date. In connection with
such payment, you shall provide the Company with tax withholding
information at least ten (10) days prior to the Effective Date.
(d) To pay you for all
accrued but unused vacation time for calendar year 2008 and 2009
through the Separation Date. This payment will be made in the pay
period following the Separation Date.
(e) To continue to provide
your current Company health care benefits through the end of the
Employment Period, by making regular employer contributions for
medical, dental and vision benefits (the employee portion of the
contributions for such benefits for the Employment Period will be
deducted from your salary).
(f) To reimburse you for up
to $3,500.00 in legal fees in connection with the review of this
Agreement by your legal counsel.
3. Following the Separation Release Effective Date (as defined
in Exhibit A of this Agreement) and in exchange for your waiver of
claims against the Company Entities and compliance with the other
terms and conditions of this Agreement, the Company agrees:
(a) To pay you twenty-six
(26) weeks severance (“the Severance Period”), in the
gross amount of $200,000, less tax withholding and other applicable
deductions, in a lump sum amount. This payment will occur within
thirty (30) days after your Separation Date, and will be made
following your return of a fully executed agreement, provided that
you do not revoke such release during the period for revocation. In
connection with such payment, you shall provide the Company with
tax withholding information at least ten (10) days prior to the
Separation Release Effective Date.
(b) That pursuant to the
2001 Stock Incentive Plan, your unvested restricted stock units
will fully vest upon the Separation Date and shares in respect of
such restricted stock units shall be distributed to you within
ninety (90) days of the Separation Date. Your stock options granted
under the 2001 Stock Incentive Plan will be exercisable for a
period of ninety (90) day following the Separation Date to the
extent exercisable on the Separation Date, subject to the
restrictions in paragraph 11, but not in any event beyond the
expiration of the term of such stock options. Restricted stock
units awarded to you under the Management Stock Purchase Plan shall
be settled by distribution of shares or cash to you after the
Separation Date as provided in such plan.
(c) After the Employment
Period, to the extent eligible, you may purchase continuation
medical benefits under the federal law known as COBRA. The Company
shall pay a portion of the cost of such COBRA coverage, in an
amount equal to the cost of coverage under the Company’s
group medical plan as in effect as of the Separation Release
Effective Date, until the date that is the earlier of twelve (12)
months after the end of the Employment Period or when you become
employed by a company offering the opportunity to participate in
another group medical plan (the “COBRA Eligibility
Period”). During the COBRA Eligibility Period you shall be
responsible to pay that portion of the cost of such COBRA coverage
not paid for by the Company, which amount shall be deducted in
advance from the payment in paragraph 3(a) above with
2
any excess payment to be refunded to you
should you cease to receive medical benefits within twelve (12)
months form the Employment Period.
(d) To provide you with
outplacement assistance at the expense of the Company with the Five
O’clock Club for up to twenty four months after the
Separation Date. To receive such outplacement benefits, you must
enroll within ninety (90) days of the Separation Date. There will
be no payment in lieu of non-participation.
4. You acknowledge and agree that the payments and other
benefits provided pursuant to this Agreement: (i) are in full
discharge of any and all liabilities and obligations of the Company
to you, monetarily or with respect to employee benefits or
otherwise, including but not limited to any and all obligations
arising under any alleged written or oral employment agreement
offer letter, policy, plan or procedure of the Company and/or any
alleged understanding or arrangement between you and the Company;
and (ii) exceed any payment, benefit, or other thing of value to
which you might otherwise be entitled under any policy, plan or
procedure of the Company and/or any agreement between you and the
Company.
5. (a) In consideration for the payments and benefits to be
provided you pursuant to paragraphs 2 and 3 above, you, for
yourself and for your heirs, executors, administrators, trustees,
legal representatives and assigns (hereinafter referred to
collectively as "Releasors"), forever release and discharge the
Company and its past, present and future parent entities,
subsidiaries, divisions, affiliates and related business entities,
successors and assigns, various benefit committees, employee
benefit plans or funds, and each of its or their respective past,
present and/or future shareholders, directors, officers,
fiduciaries, agents, trustees, administrators, employees and
assigns, whether acting on behalf of the Company or in their
individual or fiduciary capacities (collectively the "Company
Entities"), from any and all claims, demands, causes of action,
fees and liabilities of any kind whatsoever, whether known or
unknown, which you ever had, now have, or may have against any of
the Company Entities by reason of any act, omission, transaction,
practice, plan, policy, procedure, conduct, occurrence, or other
matter up to and including the date on which you sign this
Agreement.
(b) Without limiting the
generality of the foregoing, this Agreement is intended to and
shall release the Company Entities from any and all claims, whether
known or unknown, which Releasors ever had, now have, or may have
against the Companies Entities arising out of your employment
and/or your separation from that employment, including, but not
limited to: (i) any claim under the Age Discrimination in
Employment Act (“ADEA”), Older Workers Benefit
Protection Act, Title VII of the Civil Rights Act of 1964, the
Americans with Disabilities Act, the Equal Pay Act, the Family
Medical Leave Act, the Sarbanes-Oxley Act, the Employee Retirement
Income Security Act of 1974, as amended (“ERISA”)
(excluding claims for accrued, vested benefits under any
tax-qualified profit sharing or pension plan of the Company
Entities, subject to the terms and conditions of such plan and
applicable law), the Worker Adjustment and Retraining Notification
Act, and the Family and Medical Leave Act; (ii) any claim under the
New York State Human Rights Law, New York Executive Law, New York
City Administrative Code, New York State Constitution, or New York
common law, (iii) any other claim (whether based on a constitution,
executive order, or federal, state, or local law, statutory,
administrative or decisional), relating to or arising out of your
employment, the terms and conditions of such
3
employment, the termination of such
employment, and/or any of the events relating directly or
indirectly to or surrounding the termination of that employment,
including but not limited to breach of contract (express or
implied), wrongful discharge, detrimental reliance, defamation,
emotional distress or compensatory or punitive damages; and (iv)
any claim for attorneys' fees, costs, disbursements and/or the
like. Nothing in this Agreement shall be a waiver of claims that
may arise after the date on which you sign this Agreement. You
further acknowledge that you have been afforded all benefits and
have no claims under the Family and Medical Leave Act, the Fair
Labor Standards Act, applicable workers’ compensation law,
the Worker Adjustment and Retraining Notification Act, and
ERISA.
(c) You further agree to
execute the Separation Date Release Agreement attached hereto as
Exhibit A immediately following the Separation Date, which release
will be effective on the later of the Separation Date or the date
on which you sign the additional release, provided that you do not
revoke such release according to its terms.
(d) The releases made by you
in this Agreement shall not waive any rights you have to continuing
indemnification from the Company under its indemnification policies
for officers, which indemnification rights shall survive the
termination of your employment and the releases made by you in this
Agreement.
6. You represent and warrant that you have not commenced,
maintained, prosecuted or participated in any action, suit, charge,
grievance, complaint or proceeding of any kind against any Company
Entity in any court or before any administrative or investigative
body or agency, and agree that you will not do so in the future
with respect to any claims and/or causes of action waived by you
under this Agreement You further acknowledge and agree that by
virtue of the foregoing, you have waived all relief available to
you (including without limitation, monetary damages, equitable
relief and reinstatement) under any of the claims and/or causes of
action waived in paragraph 5 above. With the exception of your
right to bring a proceeding pursuant to the Older Workers Benefit
Protection Act of 1990 to challenge the validity of your release of
claims under ADEA, you agree, not inconsistent with the EEOC
Enforcement Guidance on Non-Waivable Employee Rights under
EEOC-Enforced Statutes dated April 11, 1997, and to the fullest
extent permitted by law, not to sue or file a charge, compliant,
grievance or demand for arbitration against the Company Entities in
any forum or assist or otherwise participate willingly or
voluntarily in any claim, arbitration, suit, action, investigation
or other proceeding of any kind which relates to any matter that
involves the Company Entities, and that occurred up to and
including the date of execution of this Agreement, unless required
to do so by court order, subpoena or other directive by a court,
administrative agency, arbitration panel or legislative body or
unless required to enforce this Agreement. To the extent any such
action may be brought by a third party, you waive any claims to any
form of monetary or other damages, or any other form of recovery or
relief in connection with any such action. Nothing in this
Agreement shall prevent you from commencing an action or proceeding
to enforce this Agreement.
7. (a) You agree that you will not disparage or encourage or
induce others to disparage any of the Company Entities. For the
purposes of this Agreement, the term "disparage" includes, without
limitation, comments or statements to the press and/or media, the
Company Entities or any individual or entity with whom any of the
Company Entities has or has had a business
4
relationship and which would adversely
affect in any manner (i) the conduct of the business of any of the
Company Entities (including, without limitation, any business plans
or prospects) or (ii) the business reputation of the Company
Entities. You agree not to publish or cause to be published,
electronically or otherwise, any story, article, column, comment,
or book (fiction or non-fiction) about the Company Entities or your
association with the Company and not to provide information about
the Company or the Company Entities to any person who may contact
you about any such story, article, column, comment or book, except
that you may make reference to, and briefly describe, your
employment at the Company and your responsibilities and
accomplishments in a truthful, non-disparagin
