Exhibit 10.23
SEPARATION
AGREEMENT & RELEASE OF ALL CLAIMS
This Separation Agreement (hereinafter referred to as “
Agreement ”) is made and entered into by and between
Hossein Arjomand (hereinafter referred to as “
Employee ”), and Align Technology, Inc.
(hereinafter referred to as “ Company ”).
In consideration of the mutual covenants and promises herein
contained and other good and valuable consideration, receipt of
which is hereby acknowledged, it is hereby agreed by and between
the parties as follows:
WHEREAS, Employee has been for a time employed by the
Company;
WHEREAS, Employee and the Company have previously entered into an
employment agreement dated as of November 5, 2005 (the “
Employment Agreement ”);
WHEREAS, the parties have agreed that the Employment Agreement be
terminated immediately upon the execution of this Agreement and
that Employee ceases to be an executive officer of the
Company;
WHEREAS, despite the termination of the
Employment Agreement, the parties desire for there to be a
transition period (the “ Transition Period ”)
from the date hereof until Employee’s termination date of
February 28, 2008 (the “ Separation Date
”);
WHEREAS, the parties wish to permanently resolve all disputes that
exist or may exist between them in the future arising out of
Employee’s employment with the Company and the termination
thereof;
NOW, THEREFORE, for and in consideration of the promises and
undertakings described below, the parties agree as
follows:
AGREEMENT
1.
The Employment Agreement shall be terminated effective
February 6, 2008, and Employee shall immediately cease to be
an executive officer of the Company, but shall continue during the
Transition Period until the Separation Date as an employee of the
Company.
2.
During the Transition Period, the Company shall continue to pay
Employee his current regular salary according to the
Company’s standard payroll schedule and practices, less
applicable deductions and withholdings. Employee has no right to
employment with the Company after the Separation Date, and the
Company has no obligation to employ him after the Separation
Date. During the Transition Period, Employee shall not report
to work, but shall make himself available to the Company, upon its
written request, to provide services, support, advice and
cooperation commensurate with his last position. Employee
understands and agrees that he is not authorized to provide any
services or support for or on behalf of the Company without prior
written authorization from the Company. Employee shall not
represent himself or otherwise hold himself out to any third party
or other person or entity as authorized to provide services, enter
agreements, or otherwise commit the Company to any action or course
of action during the Transition period without prior written
authorization. Employee acknowledges and agrees that the
continued payment of his salary during the Transition Period, as
well as the other promises
and
undertakings described herein, are adequate consideration for his
promises and undertakings and release of claims set forth
herein.
3.
Employee’s employment with the Company shall terminate on the
Separation Date, and his obligation to perform any requested
services on behalf of the Company shall cease. On the
Separation Date, the Company shall pay Employee all salary and all
accrued but unusued vacation earned by him through the Separation
Date.
4.
Employee agrees that prior to the execution of this Agreement he
was not entitled to receive any monetary payments or benefits from
the Company beyond the Separation Date, and that the only payments
and benefits that Employee is entitled to receive from the Company
in the future are those specified in this Agreement and/or the
“Subsequent Release Agreement,” described below, if the
Agreement and Subsequent Release Agreement are not
revoked.
5.
Provided that Employee executes the general release agreement
attached hereto as Exhibit A (the “ Subsequent
Release Agreement ”), on the Separation Date,
(a) Employee shall be entitled to the
payment of a gross amount equal to one year of
Employee’s last base salary, which was two hundred fifty six
thousand five hundred seventy three dollars and zero cents
($256,573.00) per year. Said payment shall be made in a lump sum
and shall be paid to Employee within ten days of either the
Separation Date or the running of the revocation period set forth
in the Subsequent Release Agreement, whichever is later. Said
payments are subject to necessary and authorized deductions, and
will be mailed to Employee’s current home address.
During the period of said payments and/or as a result of said
payments, Employee shall not be employed by the Company, shall not
be authorized to act on behalf of the Company, and shall not
represent himself to any third party as a representative, agent or
employee of the Company.
(b)
Beginning after the running of the revocation period set forth in
the Subsequent Release Agreement, in addition, the Company shall
pay Employee’s COBRA premiums for twelve (12) months
beginning with the premium for March 1, 2008 and ending with
the premium for February 1, 2009, or until such time as
Employee obtains comparable benefits, whichever is sooner.
Employee expressly agrees that he shall provide notice to the
Company at such time as he receives comparable benefits, so that
the COBRA coverage and payments can be discontinued. The
Company will not withhold taxes or other amounts from said premium
payments and Employee shall be responsible for any tax liability
associated with such payments. Employee is solely responsible
for timely electing COBRA coverage and his failure to do so will
result in forfeiture of the COBRA premiums identified in this
Paragraph 1(b).
(c)
The Company will also pay $4,500 worth of outplacement services
with Lee Hecht Harrison. The Company will not withhold taxes or
other amounts from any payments for outplacement services and
Employee shall be responsible for any tax liability associated with
such payments.
(d)
The consideration set forth in Paragraphs 5(a), 5(b) and
5(c) are not payable to Employee if Employee does not execute
the Subsequent Release Agreement or elects to revoke this Agreement
as set forth in Paragraph 13, below, or otherwise, or elects to
revoke the Subsequent Release Agreement as set forth
therein.
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(e)
Employee understands and agrees that the Subsequent Release
Agreement is attached hereto and therefore the twenty one (21) day
review period shall begin on February 5, 2008. Employee
shall have at least twenty one (21) days to consider the Subsequent
Release Agreement, but he may not execute the Subsequent Release
Agreement prior to the Separation Date. Notwithstanding
the fact that the twenty one (21) day review period expires prior
to the Separation Date, the Company agrees that it will not rescind
the Subsequent Release Agreement until March 1,
2008.
6.
Employee expressly agrees that:
(a)
The foregoing payments set forth in Paragraphs 2, 5(a),
5(b) and 5(c) shall constitute an accord and satisfaction
and a full and complete settlement of Employee’s claims,
shall constitute the entire amount of monetary consideration
provided to Employee under this Agreement except as provided
herein, and that Employee will not seek any further compensation
for any other claimed damage, costs or attorneys’ fees in
connection with the matters encompassed in this
Agreement.
(b)
The Company has made no representations to Employee regarding the
tax consequences of any amounts received by Employee pursuant to
this Agreement. Employee agrees to pay any and all federal,
state, county or local taxes, which are required by law to be paid
with respect to this Agreement. Employee agrees to indemnify
and hold the Company harmless from any claims, demands,
deficiencies, levies, assessments, executions, judgments or
recoveries by any governmental entity against the Company for any
amounts claimed due on account of this Agreement or pursuant to
claims made under any federal, state, county or local tax laws, and
any costs, expenses or damages sustained by the Company by reason
of any such claims.
7.
Employee promises that within seven days of the execution of this
Agreement, he will return to the Company all Company property, as
well as all Company proprietary information, including, but not
limited to, any documents or other data in Employee’s
possession at the time of termination.
8.
Employee represents that he has not filed any complaint, claims or
actions against the Company, its affiliated companies, or their
current or former officers, agents, directors, supervisors,
employees, attorneys or representatives with any state, federal or
local agency or court and that Employee will not do so at any time
hereafter, except that Employee understands that nothing in this
Agreement shall be construed to prohibit him from filing a charge
with, or participating in any investigation or proceeding conducted
by, the Equal Employment Opportunity Commission, National Labor
Relations Board, and/or any federal, state or local agency.
Notwithstanding the foregoing, Employee hereby waives any and all
rights to recover monetary damages in any charge, complaint or
lawsuit filed by him or by anyone else on his behalf.
9.
Employee shall refrain from communicating any disparaging,
derogatory, libelous or scandalous statements to any third party
regarding the Company, its products, services, employees, agents,
or representatives. The Company agrees that its Executive
Officers have not and will not make any derogatory, disparaging or
negative statements about Employee.
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10.
Employee hereby agrees that all rights he may have under section
1542 of the California Civil Code are hereby waived by
Employee. Section 1542 provides as follows:
“A
GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES
NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF
EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE
MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE
DEBTOR.”
11.
Notwithstanding the provisions of section 1542 of the Civil Code of
the State of California, Employee without limitation hereby
irrevocably and unconditionally releases and forever discharges the
Company, and its affiliated companies, their current and former
officers, agents, directors, supervisors, employees,
representatives, successors and assigns, and all persons acting by,
through, under, or in concert with any of them from any and all
charges, complaints, claims, causes of action, debts, sums of
money, controversies, agreements, promises, damages and liabilities
of any kind or nature whatsoever, both at law and equity, known or
unknown, suspected or unsuspected, arising from conduct occurring
on or before the date of this Agreement, including without
limitation any claims incidental to or arising out of
Employee’s employment with the Company or the termination
thereof. It is expressly understood by Employee that among
the various rights and claims being waived in this release are
those arising under the Age Discrimination in Employment Act of
1967 (29 U.S.C. § 621. et seq.), including the Older
Workers’ Benefit Protection Act (29 U.S.C. §
626(f)). This provision is intended by the parties to be all
encompassing and to act as a full and total release of any claim,
whether specifically enumerated herein or not, that Employee might
have or has had, that exists or ever has existed on or to the date
of this Agreement, except for any claims which may not legally be
released, including but not limited to claims for unemployment
insurance, workers’ compensation or indemnification under
California Labor Code section 2802. Employee acknowledges
that he has thoroughly investigated whether he has any rights to
indemnification and agrees that he is unaware of any such
rights. All released claims, including related
attorneys’ fees and costs, are forever barred by this
Agreement and without regard to whether those claims are based on
any alleged breach of a duty arising in contract or tort; any
alleged unlawful act, any other claim or cause of action; and
regardless of the forum in which it might be brought.
12.
This Agreement and compliance with its terms shall not be construed
as an admission by the Company of any liability whatsoever, or as
an admission by the Company of any violation of the rights of
Employee. The Company specifically disclaims any liability to
Employee for any alleged violation of any order, law, statute, duty
or contract on the part of the Company, or its employees or
agents.
13.
Employee understands and agrees that Employee:
(a)
Has had the opportunity of a full twenty-one (21) days within which
to consider this Agreement before signing it, and that if Employee
has not taken that full time period that Employee has failed to do
so knowingly and voluntarily.
(b)
Has carefully read and fully understands all of the provisions of
this Agreement.
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(c)
Is, through this Agreement, releasing the Company, its affiliated
companies, and their current and former officers, agents,
directors, supervisors, employees, attorneys, representatives,
successors and assigns and all persons acting by, through, under,
or in concert with any of them, from any and all claims Employee
may have against the Company or such individuals.
(d)
Knowingly and voluntarily agrees to all of the terms set forth in
this Agreement and intends to be legally bound by the
same.
(e)
Was advised and hereby is advised in writing to consider the terms
of this Agreement and consult with an attorney of Employee’s
choice prior to signing this Agreement.
(f)
Has a full seven (7) days following the execution of this
Agreement to revoke this Agreement, and has been and hereby is
advised in writing that this Agreement, all of its terms, and all
of the obligations of the Company contained herein, shall not
become effective or enforceable until the revocation period has
expired.
(g)
Understands that rights or claims under the Age Discrimination in
Employment Act of 1967 (29 U.S.C. § 621, et seq.) that may
arise after the date this Agreement is signed are not
waived.
14.
Employee agrees not to interfere with the Company’s
relationship with current employees, suppliers, customers or
investors. In furtherance of this obligation, for a period of
twelve (12) months following the date of Employee’s execution
of this Agreement, Employee shall not directly or indirectly, for
Employee or any other person, business or entity, solicit the
services of anyone employed by the Company during Employee’s
employment.
15.
The parties hereto represent and acknowledge that in executing this
Agreement they do not rely and have not relied upon any
representation or statement made by any of the parties or
by
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