Exhibit 10.1
TRANSITION AGREEMENT AND RELEASE
TRANSITION AGREEMENT AND RELEASE made as of the 18th day of March, 2003
(the "Effective Date"), by and between CollaGenex Pharmaceuticals, Inc., a
Delaware corporation (the "Company") and Brian Gallagher (the "Employee").
WHEREAS, the parties wish to recognize the Employee's past contributions
to the Company as well as define the Employee's transition from the Company and
establish the terms thereof; and
WHEREAS, the parties wish to provide for an orderly transition of the
Company's Chief Executive Officer position from the Employee to his successor;
and
NOW, THEREFORE, in consideration of the promises and conditions set forth
herein, the sufficiency of which is hereby acknowledged, the Company and the
Employee agree as follows:
1. SEPARATION DATE. The Employee's date of separation from employment with
the Company will be the earlier of: (i) the first day of employment of the
Company's new Chief Executive Officer; (ii) such earlier date as may be
determined by the Company's Board of Directors and communicated to the Employee
with a minimum of thirty (30) days advance notice; or (iii) December 31, 2003
(the "Separation Date"). Employee's rights to all employment-related benefits
shall cease on the Separation Date, except as expressly provided herein to the
contrary. If the Board determines it will be in the best interest of an
effective transition, the Employee will agree to resign his position as a
director on the Company's Board of Directors.
2. TRANSITION PERIOD.
The Employee shall continue to be employed by the Company as its Chief
Executive Officer and shall provide such other services as may reasonably be
requested by the Board of Directors during a transition period which shall run
from the Effective Date through the Separation Date (the "Transition Period").
Upon the new Chief Executive Officer's commencing employment, the Employee shall
relinquish both the title and decision-making authority attendant with the
position of Chief Executive Officer. In addition to the day to day operational
and management duties which the Employee shall continue to perform during the
Transition Period, he shall also assist the Board of Directors in its search for
a new Chief Executive Officer and work with the Company's new Chief Executive
Officer to transfer information and knowledge and provide for an orderly
transition of the Company's Chief Executive Officer position.
3. CONSIDERATION. Provided that Employee has executed and not revoked his
acceptance of this Agreement or Attachment A during their respective seven (7)
day revocation periods, the Employee shall be eligible for the following:
(a) Commencing after the Separation Date, the Company shall retain
the Employee's services as a consultant pursuant to the independent contractor
agreement attached hereto as Attachment B (the "Consulting Agreement"), which is
hereby incorporated by reference. In no event shall the first payment of
consulting fees be made earlier than the eighth (8th) day after execution of
both this Agreement and Attachment A and assuming no revocation of either such
agreement.
(b) Bonuses - The Employee is eligible for a one-time, lump sum
bonus
- 2 -
payment in the gross amount of up to One Hundred Fifty Thousand Dollars
($150,000.00) (representing approximately two times the Employee's average
yearly bonus over the past 3 years) (the "Bonus"). After the Separation Date,
the Bonus which has been earned shall be paid to the Employee in accordance with
the Company's normal payroll practices, but in no event shall the payment be
made earlier than the eighth (8th) day after execution of both this Agreement
and Attachment A and assuming no revocation of either such agreement. The exact
amount of the bonus shall be determined based upon the following:
(i) Retention Portion - $50,000.00 of the Bonus shall be earned
by the Employee automatically on the Separation Date; and
(ii) Performance Portion - $100,000.00 of the Bonus shall be
earned by the Employee on the Separation Date; provided, however, that the
payment of such $100,000 shall be conditioned upon the affirmation of each of:
(i) Ms. Nancy C. Broadbent, or, if Ms. Broadbent is no longer affiliated with
the Company, the Company's then Chief Financial Officer; and (ii) Mr. James
O'Shea, or, if Mr. O'Shea is no longer then affiliated with the Company, the
Company's then head of its Compensation Committee, that Employee in fact, at all
times prior to the Separation Date, cooperated fully with any search committee
formed by the Company's Board of Directors to locate and hire a successor to the
Employee and that Employee continued to perform services for the Company in such
manner and with such commitment, both in time and in effort, as Employee has
historically performed services for the Company.
(c) Commencing after the Separation Date, and provided that Employee
has not revoked his acceptance of this Agreement or Attachment A during their
respective seven (7) day revocation periods, the Company shall, to the extent
that he has elected to continue medical, dental, vision and prescription drug
benefits pursuant to a valid COBRA election, reimburse the
- 3 -
Employee for the COBRA premiums. The right to receive such reimbursement shall
end on the earlier of: (i) the Employee's becoming eligible to receive benefits
pursuant to the plan of a new employer; and (ii) eighteen (18) months from the
Separation Date. On or about the first of each month beginning in the month that
is nineteen (19) months from the Separation Date and through and including the
month that is twenty-four (24) months from the Separation Date, the Company
shall pay Employee an amount in cash equal to the amount of the COBRA payment
made by the Company on behalf of the Employee during the eighteenth (18th) month
from the Separation Date, on a grossed up basis for taxes; provided, however,
that the Company's obligations to make payments to the Employee pursuant to this
sentence shall terminate at such time as the Employee becomes eligible to
receive benefits pursuant to the plan of a new Employer.
(d) After the Separation Date, the Company shall pay the Employee a
lump sum payment in the gross amount of fifteen thousand dollars ($15,000.00)
(representing payment by the Company for outplacement services and expenses -
although the Employee shall have the right to spend such sum as he deems
appropriate). The lump sum pay will be paid to the Employee in accordance with
the Company's normal payroll practices, but in no event shall the payment be
made earlier than the eighth (8th) day after execution of both this Agreement
and Attachment A and assuming no revocation of either such agreement.
(e) As of the Effective Date, the Company will accelerate the
Employee's right to exercise all unvested stock options previously granted to
the Employee. In addition, the exercise date for: (i) all stock options which
are contained in stock options grants which were not fully vested on the day
before the Effective Date; and (ii) those options to purchase 50,000 shares of
the Company's Common Stock pursuant to that certain Stock Option Agreement dated
February 7, 1997, shall be extended to the latest date on which the options
would have expired
- 4 -
according to the terms in each respective option agreement, had the Employee
remained actively employed by the Company. Other than as expressly stated
herein, the provisions of the Employee's stock option agreement(s) and the
Company's stock option plan(s) shall not be altered hereby and they shall remain
in full force and effect and continue to govern all aspects of the Employee's
stock options. In addition, except for that certain grant dated February 7, 1997
as and to the extent referenced above, stock option grants which were fully
vested on the day before the Effective Date are not altered in any way by this
Agreement. Nothing in this Agreement is intended to alter the Employee's current
ownership of the Company's common stock. The aforementioned modifications to the
stock option agreements are irrevocable.
(f) The Employee shall not be required to mitigate the amount of any
payment contemplated by this Agreement, nor shall any such payment be reduced by
any earnings that the Employee may receive from any other source.
(g) Although the parties do not intend for this Agreement to provide
any greater or lesser benefit on the Employee in the event of a change in
control, notwithstanding anything in this Transition Agreement to the contrary,
if it shall be determined that any payment or distribution by the Company to or
for the benefit of Employee (whether paid or payable or distributed or
distributable pursuant to the terms of this Transition Agreement or otherwise)
(a "Payment") would be subject to the excise tax imposed by Section 4999 of the
Internal Revenue code of 1986, as amended (the "Code") or any interest or
penalties are incurred by the Employee with respect to such excise tax (such
excise tax, together with any such interest and penalties, are hereinafter
collectively referred to as the "Excise Tax"), the Company shall pay to the
Employee (a "Gross-Up Payment") an amount such that after payment by the
Employee of all taxes (including any interest or penalties imposed with respect
to such taxes), including, without
- 5 -
limitation, any income taxes, calculated at the maximum federal and state rates
for individuals in the year in which a Payment is made (and any interest and
penalties imposed with respect thereto) and Excise Tax (and interest and
penalties thereon) imposed upon the Gross-Up Payment, the Employee retains an
amount of the Gross-Up Payment equal to the amount of the Excise Tax imposed
upon the Payments. The Employee undertakes and agrees that he will notify the
Chief Executive Officer and Chief Financial Officer of the Company immediately
if he is contacted or notified by any taxing authority that they will be doing
any of the following: (i) reviewing this Agreement; (ii) reviewing whether any
Excise Tax is to be imposed upon the Employee in relation the this Agreement; or
(iii) imposing any Excise Tax on the Employee in relation to this Agreement
4. RELEASES.
(a) The Employee hereby fully, forever, irrevocably and
unconditionally releases, remises and discharges the Company, its officers,
directors, stockholders, corporate affiliates, subsidiaries, parent companies,
agents, employees and attorneys (each in their individual and corporate
capacities) (hereinafter, the "Released Parties") from any and all claims,
charges, complaints, demands, actions, causes of action, suits, rights, debts,
sums of money, costs, accounts, reckonings, covenants, contracts, agreements,
promises, doings, omissions, damages, executions, obligations, liabilities, and
expenses (including attorneys' fees and costs), of every kind and nature which
he ever had or now has against the Released Parties arising out of his
employment with and/or separation from the Company, including, but not limited
to: all employment discrimination claims under Title VII of the Civil Rights Act
of 1964, 42 U.S.C. ss.2000e et seq., the Age Discrimination in Employment Act,
29 U.S.C. ss. 621 et seq., the Americans With Disabilities Act of 1990, 42
U.S.C. ss.12101 et seq., the Pennsylvania Human
- 6 -
Relations Act, all as amended; all claims arising out of the Family and Medical
Leave Act, 29 U.S.C. ss. 2601 et seq., the Fair Credit Reporting Act, 15 U.S.C.
ss.1681 et seq., and the Employee Retirement Income Security Act of 1974
("ERISA"), 29 U.S.C. ss.1001 et seq., all as amended; all other statutory
claims, including but not limited to, any state discrimination or employment
law, and any state whistleblower protection law; all common law claims
including, but not limited to, actions in tort, defamation and breach of
contract; all claims to any non-vested ownership interest in the Company,
contractual or otherwise; and any claim or damage arising out of the Employee's
employment with and/or separation from the Company (including a claim for
retaliation) under any common law theory or any federal, state or local statute
or ordinance not expressly referenced above; provided, however, that nothing in
this Agreement prevents the Employee from filing, cooperating with, or
participating in any proceeding before the Equal Employment Opportunity
Commission or a state fair employment practices agency (except that the Employee
acknowledges that he may not be able to recover any monetary benefits in
connection with any such claim, charge or proceeding). Nothing herein shall
release the Employee's rights to take action against the Company for a breach of
this Agreement or the Consulting Agreement. Such a breach will not, however, act
to invalidate this release as to all other claims.
(b) In consideration of the payment of the consideration described
in paragraph 3, which the Employee acknowledges he would not otherwise be
entitled to receive, the Employee agrees that on the Separation Date, he will
sign the Release attached hereto as Attachment A.
(c) The Company hereby fully, forever, irrevocably and
unconditionally releases, remises and discharges the Employee, his heirs and
administrators, or any of them, of
- 7 -
and from any and all claims, charges, complaints, demands, actions, causes of
action, suits, rights, debts, sums of money, costs, accounts, reckonings,
covenants, contracts, agreements, promises, doings, omissions, damages,
executions, obligations, liabilities, and expenses (including attorneys' fees
and costs), of every kind and nature, which the Company ever had or now has, and
whether presently known or hereafter discovered, against the Employee, his heirs
and administrators, or any of them, arising out of the Employee's employment
with and/or separation from the Company. Nothing herein shall release the
Company's right to take action against the Employee for a breach of this
Agreement or the Consulting Agreement. Such a breach will not, however, act to
invalidate this release as to all other claims.
5. NON-DISCLOSURE; NON-COMPETITION, NON-SOLICITATION, ASSIGNMENT OF
RIGHTS. The Employee acknowledges his obligation to keep confidential all
non-public information concerning the Company which he acquired during the
course of his employment with the Company. The parties acknowledge and agree
that any non-competition or non-solicitation agreements previously signed by the
Employee in the Company's favor shall be superceded by this Agreement. Employee
acknowledges and agrees:
(a) that all information, whether or not in writing, of a private,
secret or confidential nature concerning the Company's business, business
relationships or financial affairs (collectively, "Proprietary Information") is
and shall be the exclusive property of the Company. By way of illustration, but
not limitation, Proprietary Information may include inventions, products,
processes, methods, techniques, formulas, compositions, compounds, projects,
developments, plans, research data, clinical data, financial data, personnel
data, computer programs, customer and supplier lists, and contacts at or
knowledge of customers or prospective customers of the Company. Proprietary
Information shall not include any general
- 8 -
"know-how" of Employee or information that the Employee knew prior to his
employment with the Company that has not been previously assigned to the
Company. The Employee will not disclose any Proprietary Information at any time
without written approval by an executive officer, unless and until such
Proprietary Information has become public knowledge without fault by the
Employee or the Employee is compelled to disclose any such information by
process of law. If compelled to disclose, however, the Employee shall give the
Company a minimum of 5 business days notice of his intent to so disclose.
(b) that all files, letters, memoranda, reports, records, data,
sketches, drawings, laboratory notebooks, program listings, or other written,
photographic, or other tangible material containing Proprietary Information,
whether created by the Employee or others, which have or shall come into his
custody or possession, shall be and are the exclusive property of the Company.
All such materials or copies thereof and all tangible property of the Company in
the custody or possession of the Employee shall be delivered to the Company,
upon the earlier of (i) a request by the Company or (ii) termination of
Employee's employment. After such delivery, the Employee shall not retain any
such materials or copies thereof or any such tangible property.
(c) that his obligation not to disclose or to use information and
materials of the types set forth in paragraphs (a) and (b) above, and his
obligation to return materials and tangible property, set forth in paragraph (b)
above, also extends to such types of information, materials and tangible
property of customers of the Company or suppliers to the Company or other third
parties who may have disclosed or entrusted the same to the Company or to the
Employee.
(d) to assign and does hereby assign to the Company (or any person
or entity
- 9 -
designated by the Company) all his right, title and interest in and to all
inventions, improvements, discoveries, methods, developments, software, and
works of authorship, whether patentable or not, which are created, made,
conceived or reduced to practice by him or under his direction or jointly with
others during his employment by the Company, whether or not during normal
working hours or on the premises of the Company (all of which are collectively
referred to herein as "Developments") and all related patents, patent
applications, copyrights and copyright applications. However, this paragraph (d)
shall not apply to Developments which do not relate to the business or research
and development conducted or planned to be conducted by the Company and which
are made and conceived by the Employee not during normal working hours, not on
the Company's premises and not using the Company's tools, devices, equipment or
Proprietary Information. This paragraph (d) shall also not apply to the
Employee's general know how to which no property rights could otherwise attach.
The Employee understands that, to the extent this Agreement shall be construed
in accordance with the laws of any state which precludes a requirement in an
employee agreement to assign certain classes of inventions made by an employee,
this paragraph (d) shall be interpreted not to apply to any invention which a
court rules and/or the Company agrees falls within such classes. The Employee
also hereby waives all claims to moral rights in any Developments.
(e) to cooperate fully with the Company, both during and after his
employment with the Company, with respect to the procurement, maintenance and
enforcement of copyrights, patents and other intellectual property rights (both
in the United States and foreign countries) relating to Developments. The
Employee shall sign all papers, including, without limitation, copyright
applications, patent applications, declarations, oaths, formal assignments,
assignments of priority rights, and powers of attorney, which the Company may
deem necessary
- 10 -
or desirable in order to protect its rights and interests in any Development.
The Employee further agrees that if the Company is unable, after reasonable
effort, to secure the signature of the Employee on any such papers, the Company
may take any and all actions as the Company may deem necessary or desirable in
order to protect its rights and interests in any Development.
(f) For a period of eighteen (18) months after the date hereof, the
Employee will not directly or indirectly:
(i) Engage in any business or enterprise (whether as owner,
partner, officer, director, employee, consultant, investor, lender or otherwise,
except as the holder of not more than 1% of the outstanding stock of a
publicly-held company) that develops, manufactures, markets, licenses, sells or
provides any Product or Service that competes with any Product or Service
developed, manufactured, marketed, licensed, sold or provided, or planned to be
developed, manufactured, marketed, licensed, sold or provided, by the Company
while the Employee was employed by the Company. For the purposes of this
subsection 5(f)(i), the term "Product or Service" shall only apply to products
and services in the following business lines: (A) pharmaceuticals indicated for
dental indications, (B) branded mid-potency corticosteroids, (C) tetracycline
and tetracycline-based Rx products for acne/rosacea, including, but not limited
to, ocular rosacea, (D) topical sulfacetamide/sulfur products for acne/rosacea;
and (E) lipid based drug delivery skin barrier restoration products;
(ii) Solicit, divert or take away, or attempt to divert or to
take away, the business or patronage of any of the clients, customers, accounts,
or business partners of the Company with which the Company was engaged during
the term of the Employee's employment with the Company; or
(iii) Either alone or in association with others solicit for
employment,
- 11 -
hire or engage as an independent contractor, or assist any organization to
solicit for employment, hire or engage as an independent contractor, any person
who was employed or engaged as an independent contractor by the Company at any
time during the term of the Employee's employment with the Company; provided,
that this clause shall not apply to the solicitation, hiring or engagement of
any individual whose employment or engagement with the Company has been
terminated for a period of twelve (12) months or longer. Nothing in this
Agreement shall prevent the Employee from retaining or otherwise utilizing the
services of contract research organizations or industry consultants who were
utilized by the Company during the Employee's employment, so long as such use
does not violate section (f)(i) above and does not adversely interfere in the
Company's business.
(g) If any restriction set forth in this Section 5 is found by any
court of competent jurisdiction to be unenforceable because it extends for too
long a period of time or over too great a range of activities or in too broad a
geographic area, it shall be interpreted to extend only over the maximum period
of time, range of activities or geographic area as to which it may be
enforceable.
6. RETURN OF COMPANY PROPERTY. The Employee agrees and acknowledges that
he shall return, no later than the Separation Date all Company property
including, but not limited to, keys, files, records (and copies thereof),
computer hardware and software, cellular phones, pagers, and Company vehicle,
which is in his possession or control. The Employee further agrees to leave
intact all electronic Company documents, including those which he developed or
helped to develop during his employment.
7. INDEMNIFICATION. The Company hereby agrees that after the Separation
Date, it shall provide the Employee with indemnification against any and all
claims, charges, complaints,
- 12 -
demands, actions, causes of action, suits, rights, debts, sums of money, costs,
accountings, reckonings, covenants, contracts, agreements, promises, doings,
omissions, damages, executions, obligations, liabilities and expenses, at the
same level as is received by actively employed Executive Officers of the Company
at the time Employee makes such claims of indemnification to the Company.
8. NON-DISPARAGEMENT. The Employee understands and agrees that as a
condition for payment to him of the consideration described herein, he will not
make any false, disparaging or derogatory statements to any media outlet,
industry group, financial institution or current or former employee, consultant,
client or customer of the Company regarding the Company or any of its directors,
officers, employees, agents or representatives or about the Company's business
affairs and financial condition. The Company agrees that its current executive
officers and directors will not make any false, disparaging or derogatory
statements about the Employee to any media outlet, industry group, financial
institution or current or former employee, consultant, client or customer of the
Company.
9. CONFIDENTIALITY. To the extent permitted by law, the parties agree that
the contents of the negotiations and discussions resulting in this Agreement,
shall be maintained as confidential by the parties and their respective agents
and representatives, and shall not be disclosed except to the extent required by
federal or state law or as otherwise agreed to in writing by the Company. As
this Agreement will be filed with the Securities and Exchange Commission,
nothing herein will be deemed a prohibition on any parties' sharing this
document with others after it has been so filed.
10. NATURE OF AGREEMENT. The parties understand and agree that nothing in
this Agreement shall constitute an admission of liability or wrongdoing on the
part of either of the
- 13 -
parties.
11. AMENDMENT. This Agreement shall be binding upon the parties and may
not be abandoned, supplemented, changed or modified in any manner, orally or
otherwise, except by an instrument in writing of concurrent or subsequent date
signed by a duly authorized representative of the parties hereto.
12. WAIVER OF RIGHTS. No delay or omission by the Company in exercising
any rights under this Agreement shall operate as a waiver of that or any other
right. A waiver or consent given by the Company on any one occasion shall be
effective only in that instance and shall not be construed as a bar or waiver of
any right on any other occasion.
13. VALIDITY. Should any provision of this Agreement be declared or be
determined by any court of competent jurisdiction to be illegal or invalid, the
validity of the remaining parts, terms, or provisions shall not be affected
thereby and said illegal or invalid part, term or provision shall be deemed not
to be a part of this Agreement.
14. APPLICABLE LAW. This Agreement shall be governed by the laws of the
Commonwealth of Pennsylvania, without regard to conflict of laws provisions. The
parties hereby irrevocably submit to the jurisdiction of the courts of the
Commonwealth of Pennsylvania, or if appropriate, a federal court located in
Pennsylvania (which courts, for purposes of this Agreement, are the only courts
of competent jurisdiction), over any suit, action or other proceeding arising
out of, under, or in connection with this Agreement or its subject matter.
15. ACKNOWLEDGMENTS. The Employee acknowledges that he has been given
twenty-one (21) days to consider this Agreement, including Attachment A, and
that the Company
- 14 -
advised him to consult with an attorney of his own choosing prior to signing
this Agreement and Attachment A. The Employee further acknowledges he may revoke
this Agreement for a period of seven (7) days after the execution of this
Agreement, and the Agreement shall not be effective or enforceable until the
expiration of this seven (7) day revocation period. In addition, the Employee
further acknowledges that he may revoke Attachment A for a period of seven (7)
days after he executes it, and that Attachment A shall not be effective or
enforceable until the expiration of this seven (7) days revocation period.
16. VOLUNTARY ASSENT. The Employee affirms that no other promises or
agreements of any kind have been made to or with him by any person or entity
whatsoever to cause him to sign this Agreement, and that he fully understands
the meaning and intent of this Agreement. The Employee states and represents
that he has had an opportunity to fully discuss and review the terms of this
Agreement with an attorney. The Employee further states and represents that he
has carefully read this Agreement, understands the contents herein, freely and
voluntarily assents to all of the terms and conditions hereof, and signs his
name of his own free act.
17. ENTIRE AGREEMENT. This Agreement contains and constitutes the entire
understanding and agreement between the parties hereto with respect to the
subject matter hereof and supercedes all previous oral and written negotiations,
agreements, commitments, and writings in connection therewith. Without limiting
the foregoing, this Agreement supercedes in its entirety the CollaGenex
Pharmaceuticals, Inc. Change of Control Agreement signed by the Employee.
18. SUCCESSORS.
(a) Company's Successors. Any successor to the Company (whether
direct or indirect and whether by purchase, lease, merger, consolidation,
liquidation or otherwise) to all or
- 15 -
substantially all of the Company's business and/or assets shall assume the
Company's obligations under this Agreement in the same manner and to the same
extent as the Company. In addition all rights of the Company under this
agreement shall inure to the benefit of and be enforceable by any of its
successors, agents, employees, and assigns.
(b) Employee's Successors. Without the written consent of the Board
of Directors of the Company, the Employee shall not assign or transfer this
Agreement or any right or obligation under this Agreement to any other person or
entity. Notwithstanding the foregoing, the terms of this Agreement and all
rights of the Employee hereunder shall inure to the benefit of, and be
enforceable by, the Employee's executors, administrators, heirs, distributes,
devisees and legatees.
19. COUNTERPARTS. This Agreement may be executed in two (2) signature
counterparts, each of which shall constitute an original, but all of which taken
together shall constitute but one and the same instrument.
IN WITNESS WHEREOF, all parties have set their hand and seal to this Agreement
as of the date written above.
By: CollaGenex Pharmaceuticals, Inc.
/s/ James O'Shea Date: March 18, 2003
---------------------------------- ------------------
James O'Shea
Member of the Board of Directors
/s/ Brian Gallagher Date: March 18, 2003
---------------------------------- ------------------
Brian Gallagher
- 16 -
ATTACHMENT A
RELEASE
In consideration of the payment of the consideration described in paragraph 3 of
the Transition Agreement and Release to which this Attachment A is attached,
which the Employee acknowledges he would not otherwise be entitled to receive,
the Employee hereby fully, forever, irrevocably and unconditionally releases,
remises and discharges the Company, its officers, directors, stockholders,
corporate affiliates, subsidiaries, parent companies, agents, employees and
attorneys (each in their individual and corporate capacities) (hereinafter, the
"Released Parties") from any and all claims, charges, complaints, demands,
actions, causes of action, suits, rights, debts, sums of money, costs, accounts,
reckonings, covenants, contracts, agreements, promises, doings, omissions,
damages, executions, obligations, liabilities, and expenses (including
attorneys' fees and costs), of every kind and nature which he ever had or now
has against the Released Parties arising out of his employment with and/or
separation from the Company, including, but not limited to: all employment
discrimination claims under Title VII of the Civil Rights Act of 1964, 42 U.S.C.
ss.2000e et seq., the Age Discrimination in Employment Act, 29 U.S.C. ss. 621 et
seq., the Americans With Disabilities Act of 1990, 42 U.S.C. ss.12101 et seq.,
the Pennsylvania Human Relations, all as amended; all claims arising out of the
Family and Medical Leave Act, 29 U.S.C. ss. 2601 et seq., the Fair Credit
Reporting Act, 15 U.S.C. ss.1681 et seq., and the Employee Retirement Income
Security Act of 1974 ("ERISA"), 29 U.S.C. ss.1001 et seq., all as amended; all
other statutory claims, including but not limited to, any state discrimination
or employment law, and any state whistleblower protection law; all common law
claims including, but not limited to, actions in tort, defamation and breach of
contract; all claims to any non-vested ownership interest in the Company,
contractual or otherwise, including but not limited to claims to stock or stock
options; and any claim or damage arising out of the Employee's employment with
and/or separation from the Company (including a claim for retaliation) under any
common law theory or any federal, state or local statute or ordinance not
expressly referenced above; provided, however, that nothing in this Agreement
prevents the Employee from filing, cooperating with, or participating in any
proceeding before the Equal Employment Opportunity Commission or a state fair
employment practices agency (except that the Employee acknowledges that he may
not be able to recover any monetary benefits in connection with any such claim,
charge or proceeding). Nothing herein shall release the Employee's rights to
take action against the Company for a breach of the Transition Agreement and
Release or the Consulting Agreement. Such a breach will not, however, act to
invalidate this Release as to all other claims.
The Employee acknowledges that he has been given twenty-one (21) days to
consider the Transition Agreement and Release and Attachment A and that the
Company advised him to consult with an attorney of his own choosing prior to
signing said Agreement and this Attachment A. The Employee may revoke this
Attachment A for a period of seven (7) days after the execution of it, and this
Attachment A shall not be effective or enforceable until the expiration of this
seven (7) day revocation period.
- 17 -
I hereby provide this release of claims as of the current date and acknowledge
that the execution of this Release is in further consideration of the
compensation and benefits provided and which I have received under the
Transition Agreement and Release, to which I acknowledge I would not be entitled
if I did not sign this Release.
Date:
---------------------------------- ------------------
Brian Gallagher
- 18 -