*NOTE: CERTAIN PORTIONS OF THIS DOCUMENT HAVE BEEN MARKED TO
INDICATE THAT CONFIDENTIAL INFORMATION HAS BEEN OMITTED.
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR THIS CONFIDENTIAL
INFORMATION. THE CONFIDENTIAL PORTIONS HAVE BEEN PROVIDED
SEPARATELY TO THE SECURITIES AND EXCHANGE
COMMISSION.
SEPARATION AGREEMENT AND MUTUAL
RELEASE
This
six-page SEPARATION AGREEMENT AND MUTUAL RELEASE (hereinafter
referred to as the “Agreement” and/or
“Separation Agreement and Mutual Release”) is made
and entered into by and between William Scigliano (hereinafter
referred to as "Mr. SCIGLIANO") and Wherify Wireless, Inc.
(hereinafter referred to as "WHERIFY"). (Mr. SCIGLIANO and
WHERIFY are hereinafter collectively referred to as the
“Parties.”)
RECITALS
A.
Mr. SCIGLIANO, who is employed by WHERIFY as its President of
Government Services and is also a member of WHERIFY’s
Board of Directors, is resigning.
B.
In order to smooth Mr. SCIGLIANO’s transition and in
order to provide closure for the Parties, WHERIFY desires to
provide Mr. SCIGLIANO with certain benefits, and Mr. SCIGLIANO
desires to accept such benefits, all on the terms and
conditions set forth below.
NOW,
THEREFORE, in consideration of the premises and promises
herein contained, the adequacy and receipt of which are hereby
acknowledged by both Parties, the Parties agree as
follows:
AGREEMENTS
1.
Resignation .
Mr. SCIGLIANO hereby resigns his employment and his position on the
Board of Directors as of the “Effective Date”. Thus, at
that time, he shall cease to hold any office or title at
WHERIFY.
2.
Monetary Separation Benefits From WHERIFY
: In
consideration for Mr. SCIGLIANO’s signing and complying with
this Agreement, WHERIFY shall:
(a)
Provide
to Mr. SCIGLIANO, in a lump sum and within two (2) days of the
“Effective Date” of this Agreement, as such term
is hereinafter defined in Section 15 below, severance pay in
the gross amount of One Hundred Thirty Thousand Dollars
($130,000), subject to regular payroll deductions and
withholding.
(b)
Issue
to Mr. SCIGLIANO, within two (2) days of the Effective Date of
this Agreement,
shares of WHERIFY’s S8 stock worth One Hundred
Forty-Five Thousand Dollars ($145,000) as determined by the
market price of the stock at the time of Mr. SCIGLIANO’s
execution of this Agreement, which shares shall, after the
statutory 90-day restriction on trading such stock due to his
insider status, be subject to a three-month
“lock-up,” pursuant to which lock-up Mr. SCIGLIANO
shall have the right to sell up to one-third of the shares in
each month of the three-month lock-up; provided, however, that
he shall sell only One Hundred Forty-Five Thousand Dollars
($145,000) worth of these shares (as determined by the price
received for the shares upon their sale by Mr. SCIGLIANO)
during the lock-up period and shall return any remaining
shares to WHERIFY without charge; and provided, however, that
if Mr. SCIGLIANO sells all of the aforementioned shares for
less than One Hundred Forty-Five Thousand Dollars ($145,000)
(as determined by the price received for the shares upon their
sale by Mr. SCIGLIANO) during the lock-up period, WHERIFY
shall issue such additional shares of its S8 stock as
necessary to make up the difference between what Mr. SCIGLIANO
sold the shares for and One Hundred Forty-Five Thousand
Dollars ($145,000), the amount of any such additional shares
to be determined by the market price of the stock at the time
of the expiration of the three-month lock-up and not to be
adjusted due to fluctuations in the market price of the stock
at any time after the expiration of the three-month lock up.
The Parties agree that, except as provided above in this
Section 2(b), there shall be no obligation on the part of
WHERIFY or Mr. SCIGLIANO to make adjustments or provide
accommodations in regard to the shares to be granted to him
pursuant to this Section 2(b).
(c)
Provide a bonus to Mr. SCIGLIANO should he assist WHERIFY
after the Effective Date of this Agreement in connection with
WHERIFY’s efforts to do business with *[
CONFIDENTIAL ]*;
provided, however, that the bonus shall be provided only if any
such assistance is requested and approved by WHERIFY’s Chief
Executive Officer and only if *[
CONFIDENTIAL ]*
enter into an announced business relationship with WHERIFY within
six months of the Effective Date of this Agreement, and also
provided that any such bonus shall be in the form of shares of
WHERIFY S8 stock, without any lock-up, and in an amount to be
determined in the sole discretion of WHERIFY but in no event in an
amount worth more than Fifty Thousand Dollars ($50,000) as
determined by the market price of the stock at the time of any such
bonus.
Mr.
SCIGLIANO acknowledges that it is his intent and understanding
that he is entitled to no severance or separation benefits
other than as expressly provided for in this Agreement, and he
acknowledges that he has received payment in full for all
compensation earned by him during his employment with
WHERIFY.
3.
Taxes
: Mr.
SCIGLIANO acknowledges and agrees that WHERIFY has made no
representations to him regarding the tax consequences of any
amounts or benefits received by him pursuant to this Agreement. Mr.
SCIGLIANO also acknowledges that he is solely responsible for
payment of all taxes, state, federal and/or local, if any, for
which he may be liable on the amounts or benefits he receives
pursuant to this Agreement. He also agrees to indemnify and hold
harmless WHERIFY, and all of its employees, principals and agents,
from and against any and all loss, cost, damage, or expense,
including, but not limited to, attorney’s fees incurred by
any of them, arising out of his failure to pay the taxes, if any,
for which he is liable.
4.
Mutual Release Of Claims
:
(a)
As a material inducement to Mr. SCIGLIANO to enter into this
Agreement, WHERIFY (on behalf of itself, its successors, and
assigns) hereby releases and forever discharges Mr. SCIGLIANO
and his heirs, assigns, representatives, attorneys, insurers,
and all persons or entities acting by, through, under or in
concert with any of them, of and from any and all liabilities,
claims, obligations, promises, agreements, demands, damages,
actions, charges, complaints, costs, losses, debts and
expenses (including attorney’s fees and costs actually
incurred), and causes of action of every kind, known or
unknown, disclosed or undisclosed, matured or unmatured, which
WHERIFY may have now or in the future arising from any act or
omission or condition arising prior to its signing this
Agreement, including, but not limited to, all claims under
state, federal, or common law, whether based in contract,
tort, statute or otherwise, and including, but not limited to,
claims in any way related to Mr. SCIGLIANO's employment by
WHERIFY or the termination of such employment; provided,
however, that this Separation Agreement and Mutual Release
does not release any claims that cannot lawfully be released
by this Agreement, and does not impact any right that it may
have pursuant to any WHERIFY benefit plan, including any stock
option plan.
(b)
As a material inducement to WHERIFY to enter into this
Agreement, Mr. SCIGLIANO (on behalf of himself, his heirs, and
assigns) hereby releases and forever discharges WHERIFY
and
