EXHIBIT 10.3
CONFIDENTIAL RESIGNATION
AGREEMENT AND MUTUAL RELEASE
This
Confidential Resignation Agreement and Mutual Release (the "Mutual
Release") is entered into between M. Patricia Kane ("you") and
Terra Nova Financial Group, Inc. (the "Company"). Because this is a
legally binding document, you are advised to consult with an
attorney before signing it.
You
and the Company have determined that it is in their respective best
interests for you to resign your employment and relinquish all
positions and appointments with the Company. You and the Company
also wish to resolve any and all disputes that do exist or may
exist relating to your employment or resignation.
In
consideration of the above statements and the promises and
undertaking set forth herein, you and the Company agree as
follows:
1.
You
agree that you have resigned your employment and all positions and
appointments with the Company and with any affiliated or related
entities effective November 19, 2007 (the "Resignation Date").
2.
On
your own behalf and on behalf of anyone claiming through you,
including your past, present, and future spouses, family members,
estate, heirs, agents, attorneys or representatives, you hereby
waive, release, and forever discharge the Company and all of its
parents, divisions, affiliates, related entities, and subsidiaries,
and their fiduciaries, administrators, members, directors,
officers, agents, employees, attorneys, predecessors, successors
and assigns (all of the parties you waive, release, and discharge
by this Mutual Release will be referred to jointly as the "Released
Parties"), with respect to any and all claims or causes of action
that you now have, ever had, or will ever have or may allege to
have, whether known or unknown, arising on or before the date of
this Mutual Release. Similarly, the Company, on its own behalf and
on behalf of anyone claiming through it, hereby waives, releases,
and forever discharges you with respect to any and all claims or
causes of action that the Company now has, ever had, or will ever
have or may allege to have, whether known or unknown, arising on or
before the date of this Mutual Release other than claims involving
fraud or willful misconduct.
3.
This
Mutual Release includes any claims, demands, liabilities and causes
of action that either you or the Company may have against the other
which arise from or relate to your employment with or resignation
of employment from the Company (other than, in the case of the
Company's release of you, any claims involving fraud or willful
misconduct, which are not included in this Mutual Release). You
understand and agree that the claims being waived, released, and
discharged in this Mutual Release include those arising under the
Age Discrimination in Employment Act as amended by the Older
Workers Benefit Protection Act (the "ADEA"), Title VII of the Civil
Rights Act of 1964, the Civil Rights Act of 1866, the Americans
With Disabilities Act, the Illinois Human Rights Act, the Cook
County Human Rights Ordinance, the City of Chicago Human Rights
Ordinance, any other local, county, state or federal fair
employment law, the Fair Labor Standards Act, the Employee
Retirement Income Security Act, the Equal Pay Act, the Worker
Adjustment and Retraining Notification Act, the Family and Medical
Leave Act, and any other statute, regulation, executive order or
ordinance, and any and all claims based upon alleged wrongful or
retaliatory discharge, intentional infliction of emotional
distress, defamation, invasion of privacy, personal or business
injury, negligence, breach of contract or any other contract or
tort claims under the common law. In the event of any future
proceedings based upon any matter released herein, it is agreed
that you and the Company are not entitled to and will not receive
any further recovery.
4.
You
represent and warrant that you are the sole owner of the actual or
alleged claims, demands, rights, causes of action and other matters
relating to your employment with the Company or the cessation of
your employment that are released herein; that the same have not
been assigned, transferred
or disposed of by fact, by operation of law, or in any manner
whatsoever; and that you have the full right and power to grant,
execute, and deliver the releases, undertakings and agreements
contained herein. You further represent and warrant that you have
not filed or initiated any legal, equitable, administrative or any
other proceedings against any of the Released Parties, and that no
such proceeding has been filed or initiated on your behalf.
5.
Notwithstanding
the foregoing, the release provided in Section 2 will not extend to
the following: (a) any right to continue your group health
insurance coverage pursuant to applicable law; (b) any benefits in
which you have vested under any 401(k) plan; (c) any salary
payments owed to you through the Resignation Date; (d) any amounts
owed to you for accrued, but unused vacation,; (e) any claim for
breach of this Mutual Release; (f) any amounts due to you as
business expenses (which will not exceed $4,000.00 and which will
only be reimbursed upon submission of appropriate supporting
documentation consistent with the terms of the Company's policies);
and (g) any claim that cannot be released by law. You and the
Company agree that during your employment you were issued a total
of 360,000 warrants at an exercise price of $2.50 (this is the
adjusted number of warrants and exercise price following the
Company's reverse stock split) for the purchase of the common stock
of the Company pursuant to the Common Stock Purchase Warrant
attached hereto as Exhibit A (the "Warrant"). You and the Company
agree simultaneous with the execution of this Mutual Release to
execute that certain amendment to the Warrant attached hereto as
Exhibit B. On and after the date hereof, your warrants will be
governed by the terms of the amended Warrant. Pursuant to the terms
thereof, and in the absence of a Change of Control as defined
therein, the following vesting terms will apply: 90,000 warrants
already have vested; an additional 90,000 warrants will vest on
August 4, 2008; and the remaining 180,000 will vest on August 4,
2009. It is understood that the termination of your employment will
not divest you of the aforesaid 360,000 warrants.
6.
In
lieu of and in full satisfaction of any and all amounts or other
entitlements that are or may be owed or alleged to be owed, now or
in the future, under any agreement, letter of agreement, bonus,
benefit, or commission or other compensation plan, program or
arrangement between you and the Company (other than amounts
described in Section 5), any amounts due to you as business
expenses other than as described in Section 5(f), and in
consideration for your representations, warranties, covenants, and
agreements herein, the Company agrees to provide the following (the
"Separation Payments and Benefits"):
(a)
the
Company will provide you with a lump sum payment in the amount Two
Hundred Ninety Five Thousand Dollars ($295,000.00), less applicable
deductions required by law. This lump sum payment will be made
within fourteen (14) days after the expiration of the revocation
period described in Section 22 below, provided that you have not
revoked this Mutual Release;
(b)
if you elect
and are eligible for continuation coverage under the Company's
group health care plan in accordance with the requirements of
COBRA, the Company will pay the monthly premiums for such coverage
for six (6) months following the Resignation Date. After the end of
this six-month period, you will be solely responsible for your
monthly premiums to the extent you elect to continue your COBRA
coverage; and
(c)
the Company
will enter into that amendment to your Stock Option Agreement (the
"Stock Option Agreement") attached hereto as Exhibit C. This
amendment will be entered into immediately upon the expiration of
the revocation period described in Section 22 below, provided that
you have not revoked this Mutual Release, and will be deemed to be
effective retroactive to your Resignation Date.
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7.
You
represent and warrant that, other than amounts described in
Sections 5(c), (d), and (f), you have received all wages, salary,
commissions, bonuses, other compensation, and benefits that may
have been owed to you because of your employment. The Company
acknowledges that there are no moneys due the Company by you for
unpaid credit card balances, outstanding employee loans, or other
debts to the Company.
8.
You
agree to cooperate with the Company in any current or future
litigation or potential litigation or other legal matters,
including any arbitrations or regulatory inquiries or
investigations, in any reasonable manner as the Company may
request, including but not limited to meeting at times and dates
reasonably requested by the Company, and fully and truthfully
answering the questions of the Company or its representatives or
agents, and testifying and preparing to testify at any deposition
or trial, subject to reimbursement for reasonable out of pocket
expenses and lost wages verified by your employer, incurred as a
result of such cooperation. You also agree to provide truthful and
timely answers to any reasonable questions the Company may have
about the work you performed during your employment.
9.
You
represent and warrant that all property of the Company in your
possession or control has been returned to the Company. Such
property will include, without limitation, all office equipment,
keys, computer software or hardware, documents, internal memoranda
and records of any nature, together with all copies thereof, which
relate in any way to the Company's business or operation. The
Company agrees to return your rolodex and books personally
purchased by you.
10.
You
acknowledge and agree that you remain bound by any and all
confidentiality, non-solicitation, anti-raiding, and non-compete
agreements previously executed by you during your employment at the
Company and further agree to keep confidential all proprietary and
confidential information of the Company.
11.
You
agree not to sue any of the Released Parties, and the Company
agrees not to sue you, with respect to any matter relating to your
employment with or resignation of employment from the Company,
except that you may seek a determination of the validity of the
waiver of your rights under the ADEA and the Company may bring
claims relating to fraud or willful misconduct. If you violate this
covenant not to sue, other than by seeking a determination of the
validity of the waiver of your rights under the ADEA, you will be
liable to the Released Party or Parties for its or their reasonable
attorneys' fees and other litigation costs incurred in defending
against such a suit. If the Company violates this covenant not to
sue, other than by bringing a claim for fraud or willful
misconduct, the Company will be liable to you for your reasonable
attorneys' fees and other litigation costs incurred in defending
against such a suit. Nothing in this Mutual Release is intended to
reflect any party's belief that the waiver of your claims under the
ADEA is invalid or unenforceable, it being the intent of the
parties that such claims are waived.
12.
You
understand and agree that the Separation Payments and Benefits are
expressly conditioned upon your representations and warranties in
this Mutual Release and your compliance with the terms hereof. If
the representations and warranties in this Mutual Release are
inaccurate in any respect, you take any action inconsistent with
those representations and warranties, or you violate any of the
terms of this Mutual Release, you will not be paid, or you will be
obligated to repay, as the case may be, the Separation Payments and
Benefits. This section will not limit either party's right to
recover damages, including attorney's fees, or obtain any other
legal or equitable relief to which it may be entitled by law.
13.
You
agree that you have no present or future right to, and will not
apply for or accept, employment with the Company or its affiliated
or related entities.
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14.
This
Mutual Release does not constitute an admission by the Released
Parties of any violation of any law. The Released Parties expressly
deny any such violation. This Mutual Release is offered to you by
the Company solely to avoid litigation.
15.
You
understand and agree that no promises or representations have been
made by the Company respecting the subject matter hereof other than
those expressly set forth herein. Except for the Warrant and the
Stock Option Agreement (as both are amended hereby) and as stated
in Section 10, this Mutual Release constitutes the only agreement
between the parties respecting the subject matter hereof, and
supersedes all prior agreements, promises, representations and
understandings, written or oral, between the parties on such
subject matter. Further, any modifications or amendments may be
made only in a written agreement between the parties.
16.
If any
provision of this Mutual Release is determined by a court of
competent jurisdiction to be unenforceable in any respect, then
such provision will be deemed limited and restricted to the maximum
extent that the court will deem the provision to be enforceable,
or, in the event that this is not possible, the provision will be
severed and all remaining provisions will continue in full force
and effect. However, in the event that the waiver or release of any
claim is found to be invalid or unenforceable and cannot be
modified as aforesaid, then you or the Company, as the case may be,
agrees that the other will promptly execute any appropriate
documents that would make the waiver or release valid and
enforceable to the maximum extent permitted by law. The invalidity
or unenforceability of any provision of this Mutual Release will
not affect the validity or enforceability of any other provision
hereof.
17.
You and
the Company agree that the terms of this Mutual Release and any
confidential matters concerning your employment and resignation of
employment with the Company will be kept confidential. You and the
Company agree not to reveal or engage in any conduct that might
reveal the terms of this Mutual Release to anyone except, in your
case, members of your immediate family, your attorneys, and your
tax advisors, and, in the case of the Company, its Board members
and management with a need to know such information, its attorneys,
and its tax advisors and auditors (and, in the case of those
individuals to whom disclosures are made by either party, only
after informing such individuals of the confidential nature of the
information being disclosed and obtaining the agreement of those
individuals to refrain from any further disclosures). You agree not
to make any oral or written statement to any third party that
defames the Company, including the Company's officers, employees or
services. The Company agrees that its senior management will not
make any oral or written statements to third parties that defame
you. However, notwithstanding anything else in this Section 17 or
any other part of this Mutual Release, either party may make such
disclosures or statements as may be necessary for any regulatory
disclosure, as otherwise required by law, or as necessary for
legitimate business purposes (and in that case only if the party
receiving the information is subject to confidentiality
obligations).
18.
You
understand and agree that this Mutual Release will be binding upon
your heirs, assigns, administrators, executors and legal
representatives and will inure to the benefit of the Company, its
successors and assigns. In the event of your death, the Separation
Payments and Benefits will be paid to your heirs and/or estate in a
manner as required by law.
19.
The
internal law (and not the law of conflicts) of the State of
Illinois will govern all questions concerning the construction,
validity, and interpretation of this Mutual Release. This Mutual
Release may be executed in multiple counterparts, each of which
will constitute an original.
20.
The
Company agrees that it will reimburse you for, or pay directly on
your behalf, any fine assessed against you by FINRA arising from or
relating to your employment with the Company. You agree that the
Company will have the right, but not the obligation, to challenge
at its sole expense any finding, disciplinary action, sanction, or
fine by FINRA against you ("Regulatory Action"). If the
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Company elects to bring such a challenge, you agree that the
Company will control the legal defense, that you will cooperate
fully with that defense, and that the Company may reach whatever
settlement or other resolution the Company deems to be appropriate,
subject to your right to reject such settlement or other resolution
as described below. If the Company does not challenge the
Regulatory Action, you may do so at your own risk and expense and
the Company will be relieved of all obligations to you under this
Section 20. In addition, you may reject any settlement or other
resolution reached by the Company, in which case any further
proceedings relating to the Regulatory Action also will be at your
own risk and expense and the Company will be relieved of all
obligations to you under this Section 20.
21.
By
signing this Mutual Release, you and the Company acknowledge that:
(a) you and the Company have thoroughly read and understand this
Mutual Release; (b) you have received at least 21 days to consider
the terms of this Mutual Release before signing it; (c) you have
been advised to seek legal counsel concerning the terms of this
Mutual Release before signing it and you in fact have received such
legal counsel; (d) you have signed this Mutual Release knowingly
and voluntarily, without duress or reservation of any kind; (e)
neither you nor the Company is waiving any claims or rights that
may arise after execution of this Mutual Release; and (f) the
Separation Payments and Benefits promised to you in return for your
execution of this Mutual Release include payments you would not
otherwise be entitled to receive.
22.
You
have the right to revoke this Mutual Release within 7 days of
signing it by providing written notice of such revocation to the
Company, c/o Michael Nolan, President. Your revocation must be
received by the Company before the close of business on the last
day of the revocation period to be valid. This Mutual Release will
not be valid or enforceable until the revocation period has expired
and then only if your signature has not been revoked.
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So Agreed:
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| TERRA NOVA FINANCIAL GROUP,
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In order to receive the Separation Payments and
Benefits offered herein, you are required to sign and return this
Mutual Release within twenty-one (21) days of its receipt by you.
Your Mutual Release may not be signed before the Resignation
Date.
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Exhibit A to Mutual
Release
NEITHER THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY
IS EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND
EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN
RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY,
MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE
WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL
OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE
OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. THIS
SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY
MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR
OTHER LOAN SECURED BY SUCH SECURITIES.
COMMON STOCK PURCHASE WARRANT
To Purchase 3,600,000 Shares of Common Stock of
RUSH FINANCIAL TECHNOLOGIES, INC.
August 4, 2006
THIS
COMMON STOCK PURCHASE WARRANT (the " Warrant ") certifies
that, for value received, M. Patricia Kane (the " Holder "),
is entitled, upon the terms and subject to the limitations on
exercise and the conditions hereinafter set forth, at any time on
or after the date hereof (the " Initial Exercise Date ") and
on or prior to the close of business on the fifth anniversary of
the Initial Exercise Date (the " Termination Date ") but not
thereafter, to subscribe for and purchase from Rush Financial
Technologies, Inc., a Texas corporation (the " Company "),
up to 3,600,000shares (the " Warrant Shares ") of Common
Stock, par value $0.01 per share, of the Company (the " Common
Stock "). The purchase price of one share of Common Stock under
this Warrant shall be equal to the Exercise Price, as defined in
Section 1(c).
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Section 1.
Exercise.
Exercise of Warrant . Exercise of the purchase rights
represented by this Warrant may be made, in whole or in part, at
any time or times on or after the Initial Exercise Date and on or
before the Termination Date by delivery to the Company of a duly
executed facsimile copy of the Notice of Exercise Form annexed
hereto (or such other office or agency of the Company as it may
designate by notice in writing to the registered Holder at the
address of such Holder appearing on the books of the Company);
provided, however, within 5 Trading Days of the date said Notice of
Exercise is delivered to the Company, if this Warrant is exercised
in full, the Holder shall have surrendered this |
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Warrant to the Company and the
Company shall have received payment of the aggregate Exercise Price
of the shares thereby purchased by wire transfer or cashier's check
drawn on a United States bank. Notwithstanding anything herein to
the contrary, the Holder shall not be required to physically
surrender this Warrant to the Company until the Holder has
purchased all of the Warrant Shares available hereunder and the
Warrant has been exercised in full. Partial exercises of this
Warrant resulting in purchases of a portion of the total number of
Warrant Shares available hereunder shall have the effect of
lowering the outstanding number of Warrant Shares purchasable
hereunder in an amount equal to the applicable number of Warrant
Shares purchased. The Holder and the Company shall maintain records
showing the number of Warrant Shares purchased and the date of such
purchases. The Company shall deliver any objection to any Notice of
Exercise Form within 1 Business Day of receipt of such notice. In
the event of any dispute or discrepancy, the records of the Holder
shall be controlling and determinative in the absence of manifest
error. The Holder and any assignee, by acceptance of this Warrant,
acknowledge and agree that, by reason of the provisions of this
paragraph, following the purchase of a portion of the Warrant
Shares hereunder, the number of Warrant Shares avai |
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