Exhibit 10.1
MAGMA DESIGN
AUTOMATION
SEPARATION AGREEMENT AND MUTUAL
RELEASE
This Separation
Agreement and Mutual Release (“Agreement”) is made as
of the 29 th day of March, 2008 (the
“Effective Date”) by and between Magma Design
Automation, Inc. (the “Company”) and Saeid Ghafouri
(“Employee”). The parties desire to enter into this
Agreement for the purpose of reaching an amicable Separation of
their employment relationship and to promote harmonious relations
in the future.
NOW THEREFORE
, in consideration of the mutual
promises made herein, the Company and Employee (each individually,
a “Party” and collectively referred to as “the
Parties”) hereby agree as follows:
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1)
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Termination
Date . Employee’s
employment at Magma ends on May 1, 2008 (“the
Termination Date”).
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2)
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General
Release and Consideration . In consideration of his or her receipt of the
“Release Proceeds” described below, the Employee hereby
releases, waives and forever discharges the Company from all
asserted and unasserted claims relating directly or indirectly to
his/her employment relationship with the Company. This Agreement
also releases the Company’s subsidiaries, successors,
assigns, officers, directors, shareholders, employees, servants,
and agents from all such claims. The Employee understands and
agrees that this Agreement will release the Company from all claims
arising under any form of law, including, but not limited to,
claims arising under any state or federal statute, constitutional
provision, common law, executive order, or agency
regulation.
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3)
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Additionally,
the Employee understands and agrees that this Agreement will
release the Company from all claims arising under any federal,
state or local law which prohibits employment discrimination on the
basis of age, sex, race, color, national origin, religion,
disability, veteran status, or any other such specially protected
class. Such claims include, but are not limited to, claims arising
under the Age Discrimination in Employment Act, Title VII of the
Civil Rights Act of 1964, the Americans with Disabilities Act, and
the California Fair Employment and Housing Act. The Employee also
understands and agrees that this Agreement will release the Company
from all tort claims and all contract claims, including, but not
limited to, claims for defamation, invasion of privacy, fraud,
emotional distress, personal injury, wrongful discharge, breach of
contract, breach of implied employment contract, and claims based
on any covenant of good faith and fair dealing. The Employee
understands and agrees that this Agreement releases the Company
from any obligation to pay the Employee any other form of severance
pay. Finally, the Employee understands and agrees that this
Agreement releases the Company from all other claims that directly
or indirectly relate to the Employee’s employment
relationship with the Company. Excepted from this release are
Employee’s rights of indemnity, statutory or otherwise,
arising from his employment with the Company.
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4)
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The Company
likewise agrees to release the Employee from any and all claims it
may have against Employee, including but not limited to any claims
that directly or indirectly relate to Employee’s employment
relationship with the Company. This release does not apply to any
claims the Company may have against the Employee arising from
Employee’s future conduct.
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5)
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Release
Proceeds . In
consideration for this general release, the Company agrees to pay
the Employee $261,250.00 in a lump sum amount (hereinafter
“Release Proceeds”). Payment under this Paragraph 5
shall be made in compliance with Paragraph 7, but in no event less
than eight (8) days after execution of this Agreement. Payment
shall be made to Employee within ten (10) days of the
Effective Date hereof.
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6)
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Return Of
Company Property . Within
three (3) business days of the Termination Date (the
“Return Date”), Employee agrees to return all Company
property remaining in his or her possession or under his or her
control to the Company, including, but not limited to, credit
cards, computers, external hard drives and hardware, cell phones,
printers, fax machines, calculators, software, source code, data
and documents, except that Employee may retain the laptop computer
in his possession. The Company will not pay the Release Proceeds to
the Employee until all such Company equipment has been returned.
Employee also agrees to promptly return any subsequently discovered
property in his or her possession after the Return Date.
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Page 1 of 4
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7)
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Taxes . For tax purposes, the Release Proceeds are
deemed to be a settlement for lost compensation. As a result, the
Company is required to and will make appropriate federal and state
tax withholdings from the Release Proceeds. The Company will also
make any other payroll deductions that Employee has authorized in
writing.
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Compensation and/or Benefits
Through Termination Date . The Company will pay to Employee his base
salary through the Termination date as well as any remaining
commissions for FY2008 including but not limited to Q4 commissions
in accordance with the FY2008 Sales Plan; all accrued Vacation and
Employee Stock Purchase Plan contributions accrued. The Company
will also pay for health benefit coverage through the end of the
month in which the Termination Date occurs, minus any Employee
contributions.
The Parties agree that the amounts
set forth in this Agreement are accurate and that neither Employee
nor Company shall have any recovery against the other for amounts
alleged to have been overpaid or underpaid on or before the
Effective Date. The payments and benefits described in this
Paragraph 7 are separate and distinct from the Release Proceeds and
are not part of the consideration provided by the Company for the
Employee’s release and other duties and obligations under
this Agreement.
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8)
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Stock
Options . As of the
Termination Date, Employee has fully vested in options
(“Options”) to purchase shares of Magma’s common
stock as set forth in the Stock Closing Statement (“Closing
Statement”). A copy of the Closing Statement was provided to
Employee as part of the separation documents. To the extent
Employee has been granted options under the Option Agreement, which
have not vested as of the Termination Date, employee shall be
entitled to an additional vesting period as set forth in
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