Exhibit 10.3
SEPARATION AGREEMENT AND
GENERAL RELEASE
This SEPARATION AGREEMENT AND GENERAL
RELEASE (“Agreement”) is made as of this 30
th day of December 2005 by and between MEDIALINK
WORLDWIDE INCORPORATED, a Delaware corporation, having an address
at 708 Third Avenue, New York, New York (“Medialink”),
and J. GRAEME McWHIRTER, with an address of 22 Eglantine Avenue,
Pennington, New Jersey (“McWhirter”).
NOW, THEREFORE, in consideration of the mutual promises and
covenants hereinafter set forth, the parties agree as
follows:
1. McWhirter’s Employment with Medialink will
terminate effective at the close of business on December 31, 2005
(the “Effective Date”). McWhirter shall resign as an
officer and director of Medialink and its subsidiaries as of the
Effective Date.
2. McWhirter acknowledges that he fully understands
the terms and implications of this Agreement.
3. McWhirter has carefully considered other
alternatives to executing this Agreement and has decided that he
will execute this Agreement.
4. McWhirter understands that he will have up to
twenty-one (21) days from the date hereof to review and execute
this Agreement and that he shall have the right, within seven (7)
days after his execution of this Agreement, to revoke same unless
such right is waived by McWhirter.
5. McWhirter further recognizes that he executes
this Agreement voluntarily and acknowledges that he has discussed
this Agreement and the terms hereof with Charles Crow, Esq., his
legal advisor. McWhirter further acknowledges that he has a full
and thorough knowledge of the legal significance of this
Agreement.
6. In consideration for McWhirter signing and
adhering to the terms and conditions of this Agreement and in
consideration for certain consulting services and other obligations
as specified below, McWhirter will, commencing on Medialink’s
next regularly scheduled payroll date after the expiration of the
seven (7) day revocation period pursuant to Section 4 hereof,
receive the following:
(a) One Hundred Seventy-Nine Thousand Six Hundred
Eight and 56/100 ($179,608.56) Dollars (the “Consulting
Payment”). Such Consulting Payment will be payable in twelve
semi-monthly installments of Fourteen Thousand Nine Hundred
Sixty-Seven and 38/100 ($14,967.38) Dollars, in accordance with
Medialink’s normal payroll schedule, through the period
ending June 30, 2006 (the period from the Effective Date through
June 30, 2006 hereinafter referred to as the “Consulting
Period”) in consideration for the provision of certain
consulting services as follows;
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i.
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Within ten (10)
days of the date hereof, McWhirter shall deliver a written report
to Medialink reasonably detailing his activities on behalf of
Medialink and shall be available to provide additional information
and advice on the matters for which he has had responsibility
during the term of his employment with Medialink;
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ii.
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From the
Effective Date to and including June 30, 2006, McWhirter shall
continue to provide information and advice to Medialink regarding
(a) all matters in which he had responsibility prior to the
Effective Date; and (b) the search for a successor to
McWhirter as CEO of Teletrax, including interviews, general advice,
etc. and transition with such new CEO; and
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iii.
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Such other
services as Medialink shall reasonably request of McWhirter with
regard to any transitional activities and any other activities in
the furtherance of Medialink’s business.
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During the
Consulting Period, Medialink shall pay all necessary and reasonable
costs of consultant in providing such services, including but not
limited to, the attorneys’ fees associated with negotiating
this Agreement, any subsequent agreement and any future consulting
agreement, provided that in no event shall such legal fees exceed
$5,000 in the aggregate. Medialink further agrees to provide
McWhirter with, and access to, the reasonably necessary resources
required for McWhirter to provide the consulting services during
the Consulting Period.
(b) One Million Four Hundred Eighty-Two Thousand Two
Hundred Fifty-Nine and 92/100 (1,482,259.92) Dollars (the
“Severance Payment”). Such Severance Payment shall be
payable over the four and one-half year period from July 1, 2006
through December 31, 2010 (the period from July 1, 2006 through
December 31, 2010 hereinafter referred to as the “Severance
Period”) as follows:
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i.
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One Hundred
Seventy-Nine Thousand Six Hundred Eight and 56/100 ($179,608.56)
Dollars payable in twelve semi-monthly installments of Fourteen
Thousand Nine Hundred Sixty-Seven and 38/100 ($14,967.38) Dollars,
in accordance with Medialink’s normal payroll schedule,
during the period July 1, 2006 through and including December 31,
2006;
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ii.
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Three Hundred
Ninety Thousand Seven Hundred Ninety-Five and 41/100 ($390,795.41)
Dollars payable in twenty-four semi-monthly installments of Sixteen
Thousand Two Hundred Eighty-Three and 14/100 ($16,283.14) Dollars,
in accordance with Medialink’s normal payroll schedule,
during the period January 1, 2007 through and including December
31, 2007;
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iii.
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Three Hundred
Forty-Seven Thousand Three Hundred Seventy-Three and 70/100
($347,373.70) Dollars payable in twenty-four semi-monthly
installments of Fourteen Thousand Four Hundred Seventy-Three and
90/100 ($14,473.90) Dollars, in accordance with Medialink’s
normal payroll schedule, during the period January 1, 2008 through
and including December 31, 2008;
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iv.
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Three Hundred
Three Thousand Nine Hundred Fifty-One and 98/100 ($303,951.98)
Dollars payable in twenty-four semi-monthly installments of Twelve
Thousand Six Hundred Sixty-Four and 67/100 ($12,664.67) Dollars, in
accordance with Medialink’s normal payroll schedule, during
the period January 1, 2009 through and including December 31, 2009;
and
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v.
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Two Hundred
Sixty Thousand Five Hundred Thirty and 27/100 ($260,530.27) Dollars
payable in twenty-four semi-monthly installments of Ten Thousand
Eight Hundred Fifty-Five and 43/100 ($10,855.43) Dollars, in
accordance with Medialink’s normal payroll schedule, during
the period January 1, 2010 through and including December 31,
2010;
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(c) Immediate vesting of all Medialink stock options
now held by McWhirter. All stock options held by McWhirter may be
exercised only until the earlier of (i) their expiration date or
(ii) December 31, 2006. All stock options not exercised by such
date will thereafter no longer be exercisable; and
(d) In the event McWhirter elects to continue to
participate in the hospitalization, group health benefit, group
term life insurance and disability plans of Medialink, then
McWhirter shall be entitled to continue in such plans on the same
terms and conditions as immediately prior to the Effective Date,
for the period ending on the earlier of (i) December 31, 2006 or
(ii) the date that he becomes eligible for similar coverage through
a new employer. McWhirter acknowledges that after the Effective
Date his continuing participation in Medialink’s
hospitalization and group health benefit plans shall be pursuant to
COBRA. In the event that McWhirter continues to remain eligible for
Medialink’s hospitalization and group health benefit plans
under COBRA beyond December 31, 2006, then McWhirter’s
continuing participation beyond such date shall be at
McWhirter’s sole cost and expense.
All payments
referenced herein are gross amounts and shall be paid on a net
amount after all applicable deductions and shall be paid only on
the condition that McWhirter executes this Agreement, does not
revoke same, and adheres to its terms. All payments referenced
herein shall be payable regardless of Employee’s death or
disability.
7. McWhirter acknowledges that he was paid his
accrued and unpaid salary and any bonuses to which he was entitled
through the Effective Date and is not entitled to any further
payments for same.
8. As a condition to McWhirter’s receiving
the payments referenced above and as a further material inducement
for Medialink to enter into this Agreement:
(a) McWhirter agrees that upon the delivery of this
Agreement from Medialink to McWhirter, McWhirter shall deliver all
Medialink Property, as hereinafter defined, in his custody or
possession to Medialink or its representatives, and McWhirter
represents and warrants that no such Medialink Property or copies
thereof have been retained by him, any of his representatives or
any person, firm or corporation owned or controlled by him or
delivered to any third party. The term “Medialink
Property” as used herein means any and all confidential or
proprietary materials belonging to Medialink which are in
McWhirter’s possession, including but not limited to books,
records, files, documents, accounting or financial records,
statements, reports, equipment, computer hardware, computer
software, programs, contact lists, information/customer data and
files (hardcopies and electronic), any proprietary information or
data of Medialink in any format and any and all copies thereof,
hard drive disks, keys to McWhirter’s offices and files,
computer passwords provided by Medialink to McWhirter, passwords
established by McWhirter on Medialink hardware and passwords
established by McWhirter on any file containing Medialink
information. Notwithstanding the foregoing, McWhirter shall be
permitted to retain the cell phone/PDA (make: Palm, model: Treo
650) and laptop computer (make: IBM, model: T43, serial #:
L3-AD598) that were used by McWhirter immediately prior to the
Effective Date; provided however, that such equipment shall be
subject to review by Medialink’s IT personnel to ensure that
all Medialink Property has been permanently removed.
(b) McWhirter acknowledges that the principal
business of Medialink is providing video and audio production and
satellite and other distribution services to television and radio
stations and Internet sites for corporations and other
organizations seeking to communicate their news to the public;
corporation communications consultation and production primarily
employing audio and video capabilities; distribution of public
relations text, audio and video to news media and the general
public via satellite, streaming media, cassette, wire or other
means; distribution of press releases by the Internet, mail and
facsimile; the maintenance of databases of media contacts for and
on behalf of clients; providing closed-captioned text and
associated streaming video clips; electronic tracking of watermark
embedded materials that are distributed or broadcast for the
purpose of reporting such broadcast or distribution; and such other
businesses as Medialink may conduct from time to time (the
“Business”). McWhirter acknowledges that he has
acquired confidential information concerning Medialink and the
Business and that, among other things, his knowledge of the
Business was enhanced through his employment by Medialink.
McWhirter acknowledges that such information is of great value to
Medialink, is the sole property of Medialink, and was acquired by
him in confidence.
(c) McWhirter agrees that he will not, at any time,
now or hereafter, use, reveal, divulge or make known to any person,
any information which is treated as confidential by Medialink and
not otherwise in the public domain, except as required by
law.
(d) McWhirter acknowledges that it is reasonably
necessary for the protection of Medialink that McWhirter agrees,
and, accordingly, McWhirter does hereby agree, that he will not,
directly or indirectly, in the entire world, at any time during the
three-year period from the Effective Date (the “Restricted
Period”):
i. engage in the Business for his account or render
any services that constitute engaging in the Business, in any
capacity to any entity; or become interested in any entity engaged
in the Business either on his own behalf or as an officer,
director, stockholder, partner, principal, consultant, associate,
employee, owner, agent, creditor, independent contractor, or
co-venturer of any third
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