EXHIBIT 10.31
SEPARATION
AGREEMENT
This Separation Agreement
(“Agreement”) and Release, which is attached hereto and
incorporated by reference as Exhibit A (“Release”), are
made by and between Wesley G. Peterson on behalf of himself, his
agents, heirs, executors, administrators, and attorneys
(“Peterson” or “Employee”) and Optical
Sensors Incorporated d/b/a väsamed and its related
corporations, parent corporation, subsidiaries, successors and
assigns, present or former officers, directors, shareholders,
agents, assigns, employees, and attorneys, delegates, benefit plans
and plan administrators, and insurers, whether in their individual
or official capacities (“Employer” or
“väsamed”).
WHEREAS, the parties to this
Agreement have mutually agreed to settle and resolve all actual and
potential claims, threatened causes of action, and matters arising
out of Employee’s employment with and separation from
Employer, and which have been or could be brought against Employer;
and
WHEREAS, the parties to this
Agreement have considered their rights, options and alternatives
under this Agreement and the attached Release.
NOW, THEREFORE, in consideration of
the foregoing recitals and all of the terms and conditions set
forth herein, the parties agree as follows:
1. Separation Date
. By this Agreement, the
Parties jointly agree that Employee’s last date of employment
with Employer shall be effective at the end of business on
March 31, 2006 (“Separation Date”). Until the
Separation Date, Employee will continue to receive his full current
salary, and will continue his full current participation in the
Employer’s employee benefit plans, consistent with the terms
of those plans.
2. Release .
The Employee will execute the
Release attached hereto as Exhibit A on March 31, 2006, or
such other date mutually agreed upon in writing by the
parties.
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3. Payment and other
Consideration . The
Employer will, after receipt of an executed Agreement and Release,
and after the expiration of all rescission periods regarding that
Release, provide the Employee with the following
consideration:
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A.
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Severance
Payment : Employer will
pay the Employee a lump sum severance payment, subject to
applicable withholding taxes, in the gross amount of Thirty-Eight
Thousand Three Hundred Thirty Three and 33/100 Dollars ($38,333.33)
(“Severance Payment”). The parties agree that this
amount shall constitute sufficient consideration to support this
Agreement and Release. The Employee shall not receive any separate
or additional payment for holidays, or other days, nor will any
401(k) contributions be taken from that Severance Payment, and no
401(k) match will be made as a result of that
distribution.
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The foregoing Severance Payment
shall be subject to legally required state and federal income tax
withholding, employee FICA contributions, and any other deductions
from gross pay required by law.
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B.
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Benefit
Continuation : On or
after March 31, 2006, Employer shall provide the Employee with
information and election materials regarding continuation coverage
in accordance with applicable state and/or federal law.
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C.
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Agreement
Not to Contest Claim for Unemployment Benefits
. The Employer will not contest the
Employee’s claim for unemployment benefits, although the
Employer may dispute inaccurate factual allegations in any related
claim or proceeding. Employer will cooperate with the Department of
Economic Security and provide the Department with information about
Employee as requested.
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D.
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Agreement
Not to Contest Re: Spousal Maintenance . Employer agrees not to contest, refute, deny
or otherwise challenge, except in response to a request for
verification by any court, administrative agency, or other
governmental unit, or by any third party pursuant to a valid
subpoena, any characterization of the termination of
Employee’s employment (as being either a voluntary
resignation or an involuntary discharge of employment) that
Employee may hereafter choose to include as part of an attempt by
Employee to modify his current spousal maintenance obligations. In
the event that such inquiry is made by any court, administrative
agency, other governmental unit, or by any third party pursuant to
a valid subpoena, Employer shall truthfully respond to such
inquiry. Nothing in this Agreement shall impose on Employer any
responsibility for or liability arising out of any effort by
Employee to modify his spousal maintenance and Employee shall
indemnify Employer for reasonable attorney’s fees and expense
incurred by Employer relative to such effort.
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E.
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Severance
Payment is Additional Compensation. The parties agree that the Consideration set
forth in Section 3 is over and above anything owed to Employee
by law or contract, and will be provided to Employee in exchange
for, and specifically contingent upon, his entering into this
Agreement and the attached Release.
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F.
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Modification
of Effect of Separation on Options . The parties agree that each of
Employee’s option agreements is amended to the extent
necessary to provide that each option or portion thereof vested as
of the Separation Date will remain exercisable through the date set
forth on Exhibit B; provided, however, no further options will vest
subsequent to the Separation Date and all other terms of each
applicable option agreement and the Employer’s 1993 Stock
Option Plan will remain in effect, including, but not limited to,
the term of each option and the ability to terminate all rights of
Employee with respect to the options in the event Employee
materially breaches the terms of any confidentiality or non-compete
agreement entered into with the Employer.
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4. Compliance with Prior
Agreements and Employer Policies Regarding Confidentiality
. The Employee remains
bound by the continuing obligations to which he agreed under his
Employee Non-Compete Agreement and Employee Confidentiality and
Assignment of Inventions Agreement, the terms of which are hereby
incorporated by reference into this Agreement.
5. Employee Warranties and
Covenant Not to Sue .
Employee warrants and represents that he has not heretofore
assigned or transferred in any manner, or purported to assign or
transfer in any manner, to any person or entity, any claim or
portion thereof or interest therein that is the subject of this
Agreement. Employee further warrants that he has not filed nor
caused to be filed any claims, complaints, or actions against
Employer before any federal, state, or local court, administrative
agency, arbitration organization, or other forum. Employee further
understands that he will not have any right to receive or retain
the payments described in Section 3 of this Agreement if he
commences or is part of a legal action that is based on any claim
waived under the Release. Upon the occurrence of any such event
(aside from an action brought to challenge the validity of a
release of claims covered by the Age Discrimination in Employment
Act or the Older Worker’s Benefit Protection Act), the
Employee will forfeit to the Employer the payments described in
Section 3 of this Agreement, and the value of any other
consideration he received pursuant to this Agreement. Employee will
also be liable to Employer for attorneys fees and costs directly
incurred by the Employer in defending any claim released by
Employee under this Agreement.
This covenant not to sue does not
apply to an action brought to challenge the validity of a release
of claims covered by the Age Discrimination in Employment Act or
the Older Worker’s Benefit Protection Act.
6.
Non-Disparagement . The parties to this Agreement agree that they
will make no disparaging comments regarding the other parties in
any respect or make any comments concerning any aspect of their
relationship or the conduct or events which precipitated
Employee’s separation or negotiation of this Agreement.
Furthermore, each party agrees not to assist or encourage in any
way any individual or group of individuals to bring or pursue a
lawsuit, charge, complaint, or grievance, or make any other demands
against the other party. In any and all future proceedings of
whatever nature, each party agrees that he/it will testify
truthfully and will testify against the other party to this
Agreement only to the extent that he/it is compelled to do so by a
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