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Exhibit 10.1
SEPARATION
AGREEMENT
AND GENERAL RELEASE OF CLAIMS
1. Donald
Morgan ("Employee") was employed by RAE Systems (the "Company") as
its Vice President and Chief Financial Officer since
January 2005. Employee has decided to retire from his
employment with the Company. It is the Company’s desire to
provide Employee with certain benefits that he would not otherwise
be entitled to receive upon his separation from service and to
resolve any claims that Employee has or may have against the
Company. Accordingly, Employee and the Company agree as set forth
below. This Agreement will become effective on the eighth day after
it is signed by Employee (the "Effective Date"), provided that
Employee has not revoked this Agreement (by written notice to Greg
Vervais at the Company) prior to that date.
2. Employee’s
employment relationship with the Company will be terminated on a
date to be mutually agreed upon between Employee and the Company
(the "Termination Date").
3. The
Company shall provide Employee with the following benefits after
this Agreement becomes effective:
(a) Consulting
Services Agreement for the six (6) month period immediately
following the Termination Date (the "Consulting Period"). The terms
and conditions of this consulting assignment are set forth in the
Consulting Services Agreement attached hereto as
Exhibit 1;
(b) A
severance payment equal to $100,000.00 less applicable withholding,
payable in a lump sum within seven days following the last day of
the Consulting Period; and
(c) A
lump sum payment equal to the cost of six months of COBRA premiums
payable at the same time as the severance payment.
Employee understands that as of his Termination Date, he will be
paid all wages and accrued, unused vacation that Employee earned
during his employment with the Company through the Termination
Date. Employee understands and acknowledges that he shall not be
entitled to any payments or benefits from the Company other than
those expressly set forth in this paragraph 3.
4. Employee
and his successors and assigns release the Company and its related
entities, past and present affiliates, shareholders, investors,
directors, officers, employees, agents, attorneys, insurers, legal
successors and assigns (the "Released Parties") of and from any and
all claims, actions and causes of action, whether now known or
unknown, which Employee now has, or at any other time had, or shall
or may have against those Released Parties based upon or arising
out of any matter, cause, fact, thing, act or omission whatsoever
occurring or existing at any time up to and including the
Termination Date, including, but not limited to, any claims of
breach of contract, wrongful termination, retaliation, fraud,
defamation, infliction of emotional distress or national origin,
race, age, sex, sexual orientation, disability or other
discrimination or harassment under the Civil Rights Act of 1964,
the Age Discrimination In Employment Act of
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1967, the Older Workers Benefit Protection Act, the Americans
with Disabilities Act, the Fair Employment and Housing Act or any
other applicable law.
5. Employee
acknowledges that he has read section 1542 of the Civil Code of the
State of California, which states in full:
A general release does not extend to claims which the creditor
does not know or suspect to exist in his favor at the time of
executing the release, which if known by him must have materially
affected his settlement with the debtor.
Employee waives any right which he has or may have under section
1542 to the full extent that he may lawfully waive such rights
pertaining to this general release of claims.
As additional consideration for the compensation and benefits
described in this Agreement, Employee agrees that he will affirm
and extend this Release of Claims for the period beginning on the
date this Agreement is initially signed and ending on the
Termination Date by re-signing this Agreement in the space at the
end of the Agreement on or shortly following the Termination
Date.
6. This
Agreement is intended to satisfy the requirements of the Older
Workers’ Benefit Protection Act, 29 U.S.C. sec. 626(f).
Employee, by this Agreement, is advised to consult with an attorney
before executing this Agreement.
Employee acknowledges and agrees
that (a) Employee has read and understands the terms of this
Agreement; (b) Employee has been advised in writing to consult
with an attorney before executing this Agreement; (c) that
Employee has obtained and considered such legal counsel as Employee
deems necessary; (d) that Employee has been given up to
twenty-one (21) days to consider whether or not to enter into
this Agreement (although Employee may elect not to use the full
21 day period at Employee’s option); and (e) that
by signing this Agreement, Employee acknowledges that Employee does
so freely, knowingly, and voluntarily.
This Agreement shall not become
effective or enforceable until the eighth day after Employee signs
this Agreement. In other words, Employee may revoke
Employee’s acceptance of this Agreement within seven
(7) days after the date Employee signs it. Employee’s
revocation must be in writing and received by Greg Vervais by 5:00
p.m. Pacific Time on the seventh day in order to be effective. If
Employee does not revoke acceptance within the seven (7) day
period, Employee’s acceptance of this Agreement shall become
binding and enforceable on the eighth day ("Effective Date"). The
benefits described above shall become due and payable in accordance
with paragraph 3, provided this Agreement has not been revoked.
This Agreement does not waive or
release any rights or claims that Employee may have under the Age
Discrimination in Employment Act that arise after the execution of
this Agreement. In addition, this Agreement does not prohibit
Employee from challenging the validity of this Agreement’s
waiver and release of claims under the Age Discrimination in
Employment Act of 1967, as amended.
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7. Employee
acknowledges and agrees that he shall continue to be bound by and
comply with the terms of any proprietary rights, assignment of
inventions and/or confidentiality agreements between the Company
and Employee. On or before the Effective Date, Employee will return
to the Company, in good working condition, all Company property and
equipment that is in Employee’s possession or control,
including, but not limited to, any files, records, computers,
computer equipment, cell phones, credit cards, keys, programs,
manuals, business plans, financial records, and all documents (and
any copies thereof) that Employee prepared or received in the
course of his employment with the Company.
8. Employee
agrees that he shall not directly or indirectly disclose any of the
terms of this Agreement to anyone other than his immediate family
or counsel, except as such disclosure may be required for
accounting or tax reporting purposes or as otherwise may be
required by law. Employee further agrees that he will not, at any
time in the future, make any critical or disparaging statements
about the Company, its products, services or its employees, unless
such statements are made truthfully in response to a subpoena or
other legal process. The Company also agrees that it will not, at
any time in the future, make any critical or disparaging statements
about the Employee, unless such statements are made truthfully in
response to a subpoena or other legal process. In response to
inquiries from prospective employers regarding Employee, the
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