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EMPLOYMENT SEPARATION AND GENERAL RELEASE AGREEMENT

Release Agreement

EMPLOYMENT SEPARATION AND GENERAL RELEASE AGREEMENT | Document Parties: POWER ONE INC You are currently viewing:
This Release Agreement involves

POWER ONE INC

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Title: EMPLOYMENT SEPARATION AND GENERAL RELEASE AGREEMENT
Governing Law: California     Date: 10/1/2008
Industry: Electronic Instr. and Controls     Sector: Technology

EMPLOYMENT SEPARATION AND GENERAL RELEASE AGREEMENT, Parties: power one inc
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Exhibit 10.1

 

EMPLOYMENT SEPARATION AND GENERAL RELEASE AGREEMENT

 

This Employment Separation and General Release Agreement (this “ Separation Agreement ”) is entered into this 1 st day of October 2008, by and between Brad W. Godfrey, an individual (“ Executive ”), and Power-One, Inc., a Delaware corporation (the “ Company ”).

 

WHEREAS , Executive has been employed as the President and Chief Operating Officer for the Company;

 

WHEREAS , Executive and the Company are parties to that certain Change in Control Agreement dated May 24, 2007 (the “ Change in Control Agreement ”);

 

WHEREAS , Executive and the Company are parties to that certain Indemnification Agreement dated April 25, 2006 (the “ Indemnification Agreement ”);

 

WHEREAS , Executive agrees to provide transitional consulting services to the Company upon the terms and conditions herein; and

 

WHEREAS , Executive and the Company mutually agreed to terminate Executive’s employment relationship with the Company effective on September 29, 2008 (the “ Separation Date ”) upon the terms set forth herein.

 

NOW, THEREFORE, in consideration of the covenants undertaken and the releases contained in this Separation Agreement, Executive and the Company agree as follows:

 

I.               Resignation / Consulting Services .

 

A.             Resignation . Executive’s employment by the Company terminated on the Separation Date. Executive hereby confirms that he resigned as an officer, director, employee, member, manager and in any other capacity with the Company and each of its affiliates effective as of the Separation Date and that he currently holds no such position with the Company or any of its affiliates. The Company confirms that it and each of its affiliates accepted such resignation effective as of the Separation Date. Executive acknowledges and agrees that he has received all amounts owed for his regular and usual salary (including, but not limited to, any severance (other than the Severance Benefits expressly provided for in, and subject to the terms of, this Separation Agreement), overtime, bonus, accrued vacation, commissions, or other wages), reimbursement of expenses, and usual benefits, and that all payments due to Executive from the Company and each of its affiliates after the Separation Date shall be determined under this Separation Agreement. Notwithstanding the foregoing, the Company acknowledges and agrees that Executive is not waiving his right to file for state unemployment insurance, which the Company will not contest.

 

B.             Consulting Services . For up to thirty (30) days following the Separation Date, the Executive shall be available to perform consulting, transition and advisory services as reasonably requested by the Company. During such period, the Executive shall not have any right to act for, represent or otherwise bind the Company or its affiliates and the Executive shall not be entitled to participate in any employee benefit plans of the Company or its

 



 

affiliates (except as provided in this Separation Agreement). Executive shall not be entitled to any additional compensation for such services.

 

II.             Severance .

 

A.             Subject to Sections II(B) and II(C) below, the Company shall provide to the Executive the following benefits, collectively the “ Severance Benefits ”:

 

(i)             Severance Pay . The Company shall provide as severance pay to Executive continued payment of his base salary in effect immediately prior to the Separation Date during the thirteen (13) month period following the Separation Date (the “ Severance Pay ”), less standard withholding and authorized deductions. The Severance Pay shall be paid in substantially equal biweekly installments beginning in the biweekly period immediately following the Separation Date.

 

(ii)            Outplacement Services Reimbursement . The Company shall reimburse Executive’s costs for reasonable outplacement services during the twelve (12) month period following the Separation Date up to a maximum of $25,000 (twenty-five thousand and 00/100), payable quarterly in arrears upon the Company’s receipt of satisfactory invoices (the “ Outplacement Benefits ”).

 

(iii)          Benefits Continuation . The Company shall provide to Executive reimbursement of medical and dental benefits under COBRA (the “ Benefits Continuation ”) for up to thirteen (13) months following the Separation Date. Benefits Continuation shall cease upon the Executive being eligible to obtain coverage from a new employer.

 

(iv)           Relocation Reimbursement . The Company shall provide to Executive reimbursement, or, in the alternative, the Company shall arrange for direct payment, of reasonable and documented costs relating to the relocation of Executive’s personal and household property from Camarillo/Thousand Oaks to the Dominican Republic to the extent Executive so relocates within one year after the Separation Date (the “ Relocation Benefit ”).

 

(v)             Continued Vesting of Equity Awards . As of the Separation Date, Executive holds 320,000 fully vested stock options to purchase shares of the Company’s common stock (the “ Options ”). Notwithstanding anything to the contrary under any equity plan or award agreement evidencing the Options, the Company shall permit the Options to remain exercisable for a period of ninety (90) days following the Separation Date (subject to earlier termination on a change in control or similar event in accordance with the provisions of the equity compensation plan under which such awards were granted and the applicable stock option agreement). As of the Separation Date, Executive also holds 200,000 outstanding and unvested restricted stock units (collectively, the “ Restricted Awards ”). Notwithstanding anything to the contrary under any equity plan or award agreement evidencing the Restricted Awards, the Company shall permit the Restricted Awards to continue to vest for twelve (12) months following the Separation Date (to the extent they are scheduled to vest during that period in accordance with their customary vesting schedules). Any Restricted Awards not scheduled (in accordance with the usual vesting schedule applicable to such awards) to vest

 

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within one year after the Separation Date, terminated on the Separation Date and Executive has no further right with respect thereto or in respect thereof.

 

B.             The Company’s obligation to provide the Severance Benefits (or to continue providing any portion thereof, as applicable) is subject to the Executive’s agreement to execute any and all agreements to waive and release, without additional consideration from the Company other than as explicitly set forth in this Agreement, all Claims against Releasees under international laws. In addition, the Company’s obligation to provide the Severance Benefits (or to continue providing any portion thereof, as applicable) is subject to continuing compliance with the restrictive covenants set forth in Section VII hereof. The Company shall have no obligation to provide the Severance Benefits at any time after a breach by Executive of either or both of the covenants set forth in Sections VII.A and B, or after any material breach of any other covenant set forth in Section VII. For purposes of clarity, upon any breach by Executive of either or both of the covenants set forth in Sections VII.A and B, or after any material breach of any other covenant set forth in Section VII (which material breach remains uncured following written notice thereof), the Options and Restricted Awards shall be immediately forfeited by the Executive. Notwithstanding the foregoing provisions of this Section II(B), in no event shall the amount of the Severance Pay actually paid by the Company to Executive be less than Ten Thousand Dollars ($10,000) in the aggregate, regardless of any breach by Executive of the restrictive covenants set forth in Section VII, which amount the parties agree is good and sufficient consideration for the Release and other obligations of Executive under this Separation Agreement.

 

C.             The Company’s obligation to provide the Severance Benefits (or any portion thereof, as applicable) is further subject to the condition that Executive shall not have revoked the Release set forth in Section III hereof pursuant to any revocation rights afforded by applicable law. The Company shall have no obligation to provide the Severance Benefits to Executive unless and until the Release becomes irrevocable by Executive under all applicable laws.

 

D.             To the extent that the Outplacement Benefits, Benefits Continuation or Relocation Benefit are taxable to the Executive, any reimbursement payment due to the Executive pursuant to such provisions shall be paid to the Executive on or before the last day of the Executive’s taxable year following the taxable year in which the related expense was incurred. The Outplacement Benefits, Benefits Continuation and Relocation Benefit are not subject to liquidation or exchange for another benefit and the amount of such benefits and reimbursements that the Executive receives in one taxable year shall not affect the amount of such benefits or reimbursements that the Executive receives in any other taxable year.

 

III.            Release . Executive, on behalf of himself, his descendants, dependents, heirs, executors, administrators, assigns, and successors, and each of them, hereby covenants not to sue and fully releases and discharges the Company and each of its parents, subsidiaries and affiliates, past and present, as well as its and their trustees, directors, officers, members, managers, partners, agents, attorneys, insurers, employees, stockholders, representatives, assigns, and successors, past and present, and each of them, hereinafter together and collectively referred to as the “ Releasees ,” with respect to and from any and all claims, wages, demands, rights, liens, agreements or contracts (written or oral), covenants, actions, suits, causes of

 

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action, obligations, debts, costs, expenses, attorneys’ fees, damages, judgments, orders and liabilities of whatever kind or nature in law, equity or otherwise, whether now known or unknown, suspected or unsuspected, and whether or not concealed or hidden (each, a “ Claim ”), which he now owns or holds or he has at any time heretofore owned or held or may in the future hold as against any of said Releasees (including, without limitation, any Claim arising out of or in any way connected with Executive’s service as an officer, director, employee, member or manager of any Releasee, Executive’s separation from his position as an officer, director, employee, manager and/or member, as applicable, of any Releasee, or any other transactions, occurrences, acts or omissions or any loss, damage or injury whatever), whether known or unknown, suspected or unsuspected, resulting from any act or omission by or on the part of said Releasees, or any of them, committed or omitted prior to the date of this Release Agreement including, without limiting the generality of the foregoing, any Claim under Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act of 1967, the Americans with Disabilities Act, the Family and Medical Leave Act of 1993, the California Fair Employment and Housing Act, the California Family Rights Act, or any other federal, state or local law, regulation, or ordinance, or any Claim for severance pay, bonus, sick leave, holiday pay, vacation pay, life insurance, health or medical insurance, pension, retirement or any other fringe benefit, workers’ compensation or disability (the “ Release ”); provided, however, that the foregoing Release does not apply to any obligation of the Company to Executive pursuant to any of the following: (1) the Executive’s rights to receive the Severance Benefits pursuant to the terms and conditions of this Agreement; (2) any right to indemnification that Executive may have pursuant to the Bylaws of the Company, its Articles of Incorporation, the laws of the State of Delaware, or under any written indemnification agreement with the Company (or any corresponding provision of any subsidiary or affiliate of the Company) with respect to any loss, damages or expenses (including but not limited to attorneys’ fees to the extent otherwise provided) that Executive may in the future incur with respect to his service as an employee, officer or director of the Company or any of its subsidiaries or affiliates; (3) with respect to any rights that Executive may have to insurance coverage for such losses, damages or expenses under any Company (or subsidiary or affiliate) directors and officers liability insurance policy; (4) any rights to continued medical or dental coverage that Executive may have under COBRA; or (5) any rights to payment of benefits that Executive may have under a retirement plan sponsored or maintained by the Company that is intended to qualify under Section 401(a) of the Internal Revenue Code of 1986, as amended. In addition, this Release does not cover any Claim that cannot be so released as a matter of applicable law. Executive acknowledges and agrees that he has received any and all leave and other benefits that he has been and is entitled to pursuant to the Family and Medical Leave Act of 1993.

 

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IV.            1542 Waiver . It is the intention of Executive in executing this Separation Agreement that the same shall be effective as a bar to each and every Claim hereinabove specified. In furtherance of this intention, Executive hereby expressly waives any and all rights and benefits conferred upon him by the provisions of SECTION 1542 OF THE CALIFORNIA CIVIL CODE and expressly consents that this Separation Agreement (including, without limitation, the Release set forth above) shall be given full force and effect according to each and all of its express terms and provisions, including those related to unknown and unsuspected Claims, if any, as well as those relating to any other Claims hereinabove specified. SECTION 1542 provides:

 

“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.”

 

Executive acknowledges that he may hereafter discover Claims or facts in addition to or different from those which Executive now knows or believes to exist with respect to the subject matter of this Separation Agreement and which, if known or suspected at the


 
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