SEPARATION AGREEMENT AND RELEASE
This
Separation Agreement and Release (the
“Agreement”), is made and entered as of the 14th
day of April, 2008 (the “Effective Date”), by and
between Avantair, Inc. (the “Company”) and John
Waters (the “Executive”).
WHEREAS ,
the Executive was an employee of the Company holding the position
of Chief Financial Officer, and was a member of the Board of
Directors of the Company; and
WHEREAS ,
the Company and the Executive severed their employment relationship
with the Executive on April 11, 2008 (the “Separation
Date”);
NOW, THEREFORE ,
in consideration of the promises herein contained, and other good
and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the Company and the Executive, intending
to be legally bound hereby, agree as follows:
1.
Other
than for the payment of salary and benefits through the
Separation Date, which the Company agrees to pay, the
Executive acknowledges that he is entitled to no damages,
payments, benefits, compensation, remuneration, back pay,
front pay, costs, expenses or fees of any kind as a result of
his employment with the Company and/or the termination of that
employment, except as provided in this Agreement.
2.
Simultaneously
with the delivery by Executive to Company of an executed copy
of this Agreement, Company shall deliver to Executive (a)
warrants for One Cent ($.01) exercisable for an aggregate of
Two Hundred Thousand (200,000) shares of the Company’s
common stock and (b) a stock certificate for Thirty-Three
Thousand Three Hundred Thirty-Four (33,334) shares of the
Company’s common stock.
3.
In
consideration for the Executive’s promises contained
herein, and in
full satisfaction of the Company’s obligations, if any,
described in the Employment Agreement between the Executive
and the Company (the “Employment
Agreement”), the
Company shall:
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a.
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within
a reasonable time, not to exceed ten (10) days from the Effective
Date, pay the Executive an amount equal to eight (8) months pay at
the Executive’s salary on the Separation Date;
and
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b.
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reimburse
the Executive for all premiums for COBRA benefits upon presentation
of documentary evidence of payment of same by the Executive, for a
period of eight (8) months from the date of this Agreement or until
such time that Executive obtains employment providing health
benefits, whichever time period is shorter, and the Executive
agrees to notify the Company immediately of any employment during
this eight (8) month period which provides health insurance
benefits.
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4.
Executive
agrees not to transfer by any method any or all of the shares
of the Company’s stock under his ownership or control
for a period of six (6) months following the date this
Agreement becomes effective, subject to its terms
(“Trading
Restriction Period”). Notwithstanding the prior
sentence, however, the Trading Restriction Period shall become
null and void should Barry
J. Gordon, Chairman of the Board of the Company, Arthur H.
Goldberg, a director of the Company, or Steven F. Santo, Chief
Executive Officer of the Company transfer by any method any or
all of their respective shares during the Trading Restriction
Period.
5.
At
the conclusion of the Trading Restriction Period,
Executive’s unrestricted shares shall be freely tradable
in the open market, subject to the Company’s
“Right of First Refusal” described in Paragraph 6
below, and in compliance with applicable securities
laws.
6.
For
a twelve (12) month period following the conclusion of the
Trading Restriction Period, the Company shall have a superior
right to that of any third party to purchase the
Executive’s shares of the Company’s common stock
(“Right of First Refusal”). The Company shall have
five (5) days after Executive provides notice of his intent to
sell his shares in the open market or pursuant to a bona fide
offer in a private transaction, to exercise its Right of First
Refusal, in accordance with the following
provisions:
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a.
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If
the Executive intends to sell his shares in the open market, such
sale(s) shall be limited to 20,000 shares during any two-week
period and the notice Executive provides to the Company pursuant to
this Paragraph 6 shall state that Executive intends to sell his
shares in the open market. If the Company exercises its Right of
First Refusal in response to Executive’s notice of his intent
to sell the shares in the open market, the Company shall pay
Executive the higher of (a) the market price of the
Executive’s shares at 4:00 p.m. Eastern Standard Time on the
day Executive provides notice of his intent to sell his shares and
(b) the highest market price of Executive’s shares during the
period from the time Executive provides notice of his intent to
sell his shares and the Company exercises its Right of First
Refusal;
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b.
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In
the event the Executive desires to sell any or all of his shares in
private transaction, the notice Executive provides to the Company
pursuant to this Paragraph 6 shall state that Executive intends to
sell his shares pursuant to a bona fide offer in a private
transaction and further shall provide sufficient facts to afford
the Company notice of the number of shares to be sold and the
purchase price of those shares. If the Company exercises its Right
of First Refusal in response to Executive’s notice of his
intent to sell any or all of his shares in a private transaction,
the Company shall pay the same price per share, and purchase all of
the shares encompassed by the bona fide offer; and
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c.
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Any
transfer of Executive’s shares made in violation of this
Agreement shall be null and void.
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7.
Neither
party’s performance of its obligations under this
Agreement shall be construed or interpreted as an admission of
any wrongdoing, fault, or liability.
8.
In
addition to the parties’ obligations described in
Paragraphs 1-7 above, the parties’ obligations under
this Agreement are further expressly conditioned upon the
following:
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a.
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The
Executive’s
delivery
to the Company of one copy of this Agreement, properly executed by
the Executive and containing his original signature, along with
further execution and/or delivery by the Executive of any and all
other documents necessary to effectuate the provisions of this
Agreement;
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b.
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The
Executive’s agreement to cooperate fully with the
Company’s reasonable requests for assistance from the
Executive in transitioning his duties and responsibilities as
former Chief Financial Officer of the Company to the
Company’s designee(s) to ensure an orderly transition of
those responsibilities for a period of eight (8) months following
execution of this Agreement provided, however, that (i) the Company
reimburses the Executive for all reasonable expenses incurred in
connection with the Executive’s performance of his
obligations under this Paragraph 8(b), only when such expenses have
been pre-approved by an officer or director of the Company prior to
the Executive incurring any such expense, (ii) the Executive will
not have any responsibility for the accuracy of internal or
external financial statements and (iii) the Company hereby
indemnifies, and agrees to hold harmless, the Executive with
respect to any claim or liability arising from, or relating to such
assistance, only upon a final determination by a court of competent
jurisdiction that any liability for such claim is not the result of
Executive’s own negligent or intentionally wrongful
conduct.
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c.
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The
Executive’s representation that he has not instituted, and
will not institute in the future, any actions, suits, claims,
appeals, grievances, arbitration, complaints or charges with any
court, tribunal or federal, state or city agency or other remedial
body against the Company, its principals and/or affiliates
relating
to matters arising out of or involving the Executive’s
employment with the Company, or the termination of that employment;
except that nothing in this Agreement precludes the Executive from
instituting a claim, charge, suit, action or appeal for the purpose
of enforcing his contractual rights under this
Agreement;
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d.
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The
Executive’s agreement not to solicit or contact any person
concerning the maintenance of any claims or actions whatsoever
against the Company, its principals and/or affiliates; except
that nothing
in
this Agreement precludes the Executive from responding to legal
process. The Executive further agrees that in the event the
Executive or his counsel is served with a subpoena order or other
legal process seeking disclosure of information rendered
confidential by this Agreement, Executive or his counsel will
inform the Company by telephone on the date on which the Executive
becomes aware such subpoena or legal process is served and provide
the Company’s counsel a copy of such subpoena or legal
process no later than the third business day from the date that
Executive or his counsel receives same. Execut
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