SEPARATION AGREEMENT AND GENERAL
RELEASE
Dolan Media Company and its affiliates,
subsidiaries, divisions, successors and assigns and its current and
former employees, officers, directors and agents (collectively,
“Employer”) and Mark Baumbach (“Baumbach”)
hereby agree as follows:
1. End of Employment
Relationship. The parties mutually agreed to end their
employment relationship effective at the close of business
July 22, 2009 (the “Last Day of
Employment”).
2. Release of Claims by
Baumbach . In exchange for the Severance Payment set out in
Paragraph 3 below, Baumbach knowingly and voluntarily releases and
forever discharges Employer, of and from any and all claims, known
and unknown, which Baumbach, his heirs, executors, administrators
or successors and assigns (collectively, “Baumbach”)
have or may have as of the Last Day of Employment, including, but
not limited to the following (the
“Release”):
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a.
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all claims that arise out of or
that relate to his employment, or the end of the employment
relationship, with Employer;
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b.
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all claims that arise out of or
that relate to the statements or actions of Employer;
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c.
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all claims for any alleged
violation of (i) the National Labor Relations Act, as amended;
(ii) Title VII of the Civil Rights Act of 1964, as amended;
(iii) the Civil Rights Act of 1991;
(iv) Sections 1981 through 1988 of Title 42 of the United
States Code, as amended; (v) the Employee Retirement Income
Security Act of 1974, as amended; (vi) the Immigration Reform
Control Act, as amended; (vii) the Americans with Disabilities
Acts of 1990, as amended; (viii) the Rehabilitation Act of
1973, 29 U.S.C. §791 et seq. ; (ix) the Age
Discrimination Act of 1967, as amended; (x) the Equal Pay Act
of 1963, as amended, (xi) the Occupational Safety and Health
Act, as amended; (xii) the Consolidated Omnibus Budget
Reconciliation Act of 1985, 26 U.S.C. §4980B; (xiii) the
Minnesota Human Rights Act, Minn. Stat. §363A.01 , et.
seq. ; (xiv) the Minnesota wage-hour and wage payment
laws; (xv) Minnesota’s Whistleblower Act, Minn. Stat. §181.932; and
(xvi) retaliation under M inn. Stat.
§176.82;
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d.
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all claims for an alleged violation
of any other federal, state, city or local human rights, civil
rights, wage-hour, wage payment, pension, employee benefits, labor
or other laws, rules, regulations, and/or guidelines,
constitutions, ordinances, public policy, contract or tort
laws;
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e.
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any and all other claims for
alleged (i) breach of contract; (ii) assault or battery;
(iii) defamation; (iv) employment discrimination;
(v) sexual or other harassment; (vi) retaliation;
(vii) reprisal; (viii) wrongful termination; (ix)
constructive discharge; (x) pain and suffering;
(xi) invasion of privacy; (xii) false imprisonment;
(xiii) fraud; (xiv) intentional or negligent
misrepresentation; (xv) interference with contractual or business
relationships; (xvi) negligence, (xvii) mental anguish;
(xviii) intentional and/or negligent infliction of emotional
distress; (xix) breach of fiduciary duty; (xx) breach of
the covenant of good faith and fair dealing; and
(xxi) promissory or equitable estoppel;
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f.
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any and all other claims arising
under the common law, whether state or federal, or any other
action, based upon any conduct of the Employer occurring up to and
including the Last Day of Employment;
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g.
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all claims arising out of the
execution, performance, or termination of any employment agreement
or any other agreement or contract of any kind with Employer;
provided, however that all rights pursuant to this Separation
Agreement are exempted from the terms of this Release;
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h.
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all claims to any non-vested
ownership interest in the Employer, contractual or otherwise,
including but not limited to claims for stock, stock options or
restricted stock; provided however that the Vested Stock Option
given pursuant to this Separation Agreement is exempted from the
terms of this Release; and
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i.
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all claims for compensatory
damages, liquidated damages, punitive damages, attorney’s
fees, costs and disbursements.
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Baumbach hereby
agrees that the Release set forth in this paragraph is a general
release and waives and assumes the risk of any and all claims for
damages which exist as of the Last Day of Employment of which he
does not know, whether through ignorance, error, oversight,
negligence or otherwise, and which, if known, would materially
affect his decision to enter this Separation Agreement and General
Release (the “Agreement and Release”).
3. Payments to Baumbach .
Employer will make the payments and provide the other benefits set
forth in this paragraph to Baumbach, only if (i) Baumbach
signs this Agreement and Release; returns it to the Employer no
later than the last day of the review period set forth in paragraph
7 and does not rescind this Agreement and Release within the
Rescission Period described in paragraph 8; and (ii) Baumbach
has not breached his obligations pursuant to this Agreement and
Release, including without limitation, those set forth in paragraph
5 below or under the Restrictive Covenant Agreement (defined
below). The payments described in this Agreement and Release will
not modify or terminate the parties’ obligations to each
other as established by this Agreement and Release.
a. Severance Pay . Employer will
pay to Baumbach $271,750.00 (“Severance Payment”), less
applicable withholdings and other lawful deductions, said amount
representing (1) fifty-two weeks pay, at the rate in effect on
the Last Day of Employment, and (2) fifty percent of the
expected annual cash bonus that would be earned by Baumbach if he
were employed with the Company through December 31, 2009,
assuming that he would have fully satisfied all performance
targets.
b. Health and Dental Benefits. Employer
shall pay on behalf of Baumbach both the Company and
Baumbach’s portion of the premium for health and dental
coverage (the “Premium Payment”) through the earlier of
(x) July 31, 2010, or (y) the date Baumbach becomes
eligible for coverage under the health plan of a new employer.
Baumbach understands and agrees that he is only entitled to the
benefits under this subparagraph 3(b) if he timely elects
continuation of coverage under COBRA.
c. Outplacement Services . Employer will
reimburse up to $10,000 to Baumbach, which he has reasonably
incurred for resume writing, interviewing skills, job searching and
other similar outplacement services (the “Outplacement
Reimbursement”).
d. Immediate Vesting of Incentive Stock
Option. Employer will immediately vest the unvested portion of
the incentive stock option to purchase 4,500 shares (post-split) of
the Employer’s common stock, which the Employer granted to
Baumbach on October 11, 2006 under that certain Incentive
Stock Option Agreement between Employer and Baumbach dated as of
October 11, 2006. Such unvested portion represents an option
to purchase 1,125 shares (the “Vested Stock
Option”).
e. Extension of Time to Exercise Vested Stock
Options. Baumbach may exercise the vested portion of any stock
options granted to him during his employment, including the Vested
Stock Option, for a period of 120 days following the Last Day
of Employment. Baumbach acknowledges and understands that he
forfeited the unvested portion of any stock options granted to him,
except the Vested Stock Option, on the Last Day of
Employment
f. Laptop. Employer will allow Baumbach
to keep the laptop, exclusive of any peripherals, that he used
while he was employed with the Company (the “Laptop”);
provided that Baumbach surrenders it immediately upon the
termination of his employment so that the Company may remove all
information and data related to the Company.
The Severance
Payment, the Premium Payment, the Outplacement Reimbursement, the
Vested Stock Option and the Laptop are collectively referred to
hereafter as the “Total Benefits.” Baumbach
understands, acknowledges and agrees that he would not receive the
Total Benefits specified in this paragraph 3, except for his
execution of this Agreement and Release and the fulfillment of the
promises it contains.
4. Method of Payment . The
Severance Payment will be made in two lump sum payments. The first
lump sum payment , in the amount of $95,113.00, will be made on the
first regularly scheduled payroll date following the expiration of
the Rescission Period. The second lump sum payment, in the amount
of $176,637.00, will be made on the first regularly scheduled
payroll date following January 1, 2010. Such payments will be sent
by first-class mail to Baumbach’s last known residence
address, unless he advises Employer in writing that he wants the
payment(s) sent to a different address. To receive reimbursement
for the outplacement services described in paragraph 3.c, Baumbach
must submit receipts to Dolan Media Company, Attn. Scott Pollei,
222 South Ninth Street, Suite 2300, Minneapolis, MN 55402,
which will be reimbursed in accordance with the Company’s
usual practice, but, in no case, earlier than the expiration of the
Rescission Period. The Vested Options shall vest effective the
business day immediately following the expiration of the Rescission
Period. The Laptop will be available for Baumbach to pick up or for
delivery, at Baumbach’s sole expense, the business day
immediately following the expiration of the Rescission
Period.
5.
Expectations of Employee. Baumbach hereby represents,
warrants and agrees as follows:
a. Business Protection. He agrees to
abide by the terms of that certain Restrictive Covenant Agreement
between Baumbach and the Company dated effective August 1,
2007 (the “Restrictive Covenant Agreement”), a copy of
which is attached to and incorporated by reference into this
Agreement as Exhibit A.
b. Return of Employer Property. He hereby
warrants and represents that he has returned all property belonging
to Employer in his possession or control, including without
limitation, cell phone, any keys, access cards, equipment, tools,
documents and files, except the Laptop.
c. Further Assurances. Baumbach hereby
agrees to respond to and assist Employer with reasonable requests
for information relating to the work Baumbach performed for
Employer prior to the Last Day of Employment.
6. Employee Affirmations/Full
Compensation . Baumbach confirms that he has not filed,
caused to be filed, or is not a party to any claim, charge,
complaint or action against Employer in any forum or form. Baumbach
further confirms that he has no known workplace injuries, that he
has reported and been paid for all hours worked and that he has
received all compensation, benefits and leaves to which he has been
entitled. Baumbach understands that the payments made and other
benefits provided by Employer under this Agreement and Release will
fully compensate Baumbach for and extinguish any and all of the
claims Baumbach is releasing, including, but not limited to, any
claim for attorney’s fees and costs and any and all claims
for any type of legal or equitable relief h
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