EXHIBIT 10.32
RELEASE AND CONSULTING AGREEMENT
(Purus, Inc., Russell K. Burbank, Peter Friedli, and The Purus Stockholders
Protective Committee)
This agreement (hereinafter "Agreement") is made effective November 19,
1996, by and between Russell K. Burbank, an individual (hereinafter
"Burbank"), on the one part, and jointly and severally Purus, Inc., a
Delaware corporation (hereinafter "Purus"); Peter Friedli, a citizen of
Switzerland (hereinafter "Friedli"); and The Purus Stockholders Protective
Committee, a committee formed by members of a group of dissident
stockholders (hereinafter "the Committee"), on the other part. This
Agreement is made and is to be performed in the City and County of San
Francisco, California, United States of America, and is based upon the
following representations of the parties:
a. Russell K. Burbank warrants and represents that he has the capacity and
authority to enter into this Agreement for himself individually, and in
any other capacity.
b. The signatories of this Agreement for the party Purus, Inc. warrant and
represent that they have the necessary capacity and authority to enter
into this Agreement for Purus and to bind Purus to perform the
obligations of this Agreement to be performed by it, to make all
waivers and releases, and to do or refrain from doing all things
necessary to completely and fully effect this Agreement.
c. Peter Friedli warrants and represents that he has the capacity and
authority to enter into this Agreement for himself individually, and in
any other capacity.
d. The signatories of this Agreement for the party The Purus Stockholders
Protective Committee warrant and represent that they have the necessary
capacity and authority to enter into this Agreement for the Committee
and to bind the Committee to perform the obligations of this Agreement
to be performed by it, to make all waivers and releases, and to do or
refrain from doing all things necessary to completely and fully effect
this Agreement.
e. On November 11, 1996, the Committee initiated a "proxy fight" for the
purpose of replacing a majority of the Board of Directors of Purus in
order to resolve a dispute concerning the Company's future plans and
direction.
f. On November 15, 1996, at a Special Meeting of the Board of Directors of
Purus, the Directors discussed the benefits that would accrue to the
Company if an agreement could be reached between the parties to end the
proxy fight.
g. On November 18, 1996, Russell K. Burbank received a proposal from Peter
Friedli with terms that Friedli believed would satisfy the Committee
and the dissident group of stockholders that he represents and cause
the Committee to discontinue the "proxy fight." Friedli's proposal
included the resignation of Burbank as an employee and director or the
Company, a follow-on consulting agreement with Burbank, and provisions
connected with Burbank's severance compensation.
h. On November 18, 1996, Burbank discussed the Friedli proposal with the
Board and was told, without a formal resolution of the Board, that if
he could negotiate an agreement satisfactory to him and Friedli, then
he should present such agreement to the Board for its consideration.
i. Russell Burbank warrants that according to his signed time sheets and
Purus records, on November 19, 1996, he had accrued 235 hours of earned
vacation, notwithstanding that paragraph 1.01 of this Agreement limits
the accrued vacation to which he is entitled to 120 hours.
j. Russell Burbank warrants that his expense reports to the date of the
execution of this Agreement are properly documented and cover only (i)
out of pocket business expenses incurred by Burbank solely for the
benefit of Purus, and (ii) out of pocket dental, medical and vision
expenses in accordance with a resolution adopted by the Board of
Directors at its Regular Meeting of May 23, 1996.
k. Each of the parties has been represented by independent legal counsel
of his or its choice concerning the negotiation and drafting of this
Agreement. Each of the parties has had the legal significance of this
Agreement explained to him or it by such independent legal counsel
prior to executing this Agreement, and each party to this Agreement is
freely, voluntarily and knowingly entering into this Agreement.
NOW, THEREFORE, in consideration of the mutual terms, covenants and
conditions set forth in this Agreement, the parties each contract, covenant
and agree as follows:
1. Consideration by Purus:
1.01 LUMP-SUM PAYMENT: Upon the execution of this Agreement, Purus
will pay to Russell K. Burbank, by check, the sum of $US
250,000.00, plus any accrued salary or vacation pay to which he is
entitled (such vacation pay not to exceed 120 hours) up to and
including the date of the execution of this Agreement.
1.02 INSTALLMENT PAYMENTS: Upon the execution of this Agreement, Purus
will deposit into an irrevocable escrow account of Burbank's
choice the sum of $US 100,000.00, with instructions that such
amount be paid to Burbank in four equal monthly installments, with
the first installment to be paid on December 19, 1996, and the
three remaining installments to be paid on January 19, 1997,
February 19, 1997 and March 19, 1997. (Ref.: Appendix A "Escrow
Instructions.")
1.03 Postponement of Annual Meeting: Immediately following the
execution of this Agreement, Purus will reschedule its Annual
Meeting to a date no later than February 1997.
1.04 Purchase of 22,000 shares of Purus Common Stock from Burbank: If,
for any reason or no reason, within ten (10) days following the
execution of this Agreement, Friedli cannot arrange and execute
the purchase of 22,000 shares of Purus common stock from Burbank
for exactly $88,000.00, based on the closing price of Purus common
stock on November 13, 1996, the last day it traded in the week
ending November 15, 1996, then within five (5) days thereafter,
Purus will purchase such shares from Burbank for the same price
(see paragraph 4.01, herein).
2. Consideration by Burbank:
2.01 Resignation as Officer and Director: Upon the execution of this
Agreement, Burbank will resign as President, Chief Executive
Officer and Chairman of the Board of Directors and as a director
of Purus.
2.02 Termination of Burbank Severance Agreements: Upon the fourth and
final installment payment by Purus of the Installment Payments
described in Section 1.02 above, each of Burbank and Purus
stipulate and agree that the Burbank Severance Agreements,
included herein as "Appendix B" shall terminate. However, if for
any reason, Burbank does not irrevocably receive all of the moneys
provided for in Section 1 herein, his rights under the agreements
included in Appendix B shall not be released or extinguished.
2.03 Agreement to be party to a Consulting Agreement: As further
consideration, Burbank agrees to accept retention as an
independent contractor to Purus pursuant to the provisions of
Section 5 of this Agreement entitled "Burbank Consulting
Agreement."
3. Consideration by the Committee:
3.01 Termination of Proxy Fight: Immediately following the execution
of this Agreement, the Committee will stop soliciting proxies in
connection with Purus' 1996 Annual Meeting and will cancel its
notice of and stop soliciting proxies for a Special Meeting.
4. Consideration by Peter Friedli:
4.01 Purchase of 22,000 shares of Purus Common Stock from Burbank:
Within ten (10) days following the full execution of the
Agreement, Peter Friedli will arrange and execute the purchase of
22,000 shares of Purus common stock from Burbank for exactly
$88,000.00, based on the closing price of Purus common stock on
November 13, 1996, the last day it traded in the week ending
November 15, 1996. If, for any reason, or no reason, Friedli
cannot arrange and execute the preceding purchase within the
aforementioned ten (10) day period, then within five (5) days
thereafter, Purus will purchase such shares from Burbank for the
same price.
5. Burbank Consulting Agreement: Upon full execution of this Agreement,
Purus and Burbank shall be a party to a consulting agreement as
follows:
5.01 Term; Cancellation or Extension: This Consulting Agreement shall
be dated effective on the date of the full execution of this
Agreement and shall become contractually binding upon the full
payment of the moneys due Burbank and the escrow account, as
provided under Section 1 herein, and shall terminate on March 19,
1997. This Consulting Agreement may be canceled at any time
during its term upon written notice to Burbank from Purus pursuant
to the provisions of this Agreement concerning notices; however,
termination of this Consulting Agreement shall have no effect on
the considerations and obligations of the parties as described in
Sections 1, 2 and 3 herein and Burbank shall be entitled to keep
all moneys covered by Section 1 herein. This Agreement can be
extended at any time by the mutual consent of both Burbank and
Purus.
5.02 Compensation of Burbank: For the term of this Consulting
Agreement, Burbank shall work without compensation for sixty (60)
hours per month. For services beyond sixty (60) hours per month,
Burbank shall be compensated at the rate of $150.00 per hour.
Burbank shall be reimbursed for out of pocket business expenses
incurred by Burbank for the sole benefit of Purus. Burbank shall
invoice Purus monthly for compensation and business expenses
during the term of this Consulting Agreement, and Purus shall
promptly pay all such invoices. Burbank shall provide
documentation of the time he spends providing services and of the
business expenses he incurs for the sole benefit of Purus.
Burbank shall not bill Purus for more than sixty (60) hours per
month for services or incur business expenses of more than $500.00
per month, without the prior approval of Purus.
5.03 Consulting Agreement Services: Burbank shall provide consulting
services to Purus' Board of Directors (herein (the Board() related
to Purus' operations. These services shall include:
(i) overseeing and directing, on behalf of the Board, the work
activities of Purus' service employees and sub-contractors,
(ii) representing Purus, on behalf of the Board, in warranty and
service matters in connection with former customers of Purus
whose PADRE(r) installations are currently covered under
warranty agreements and in connection with former customers
who are contesting Purus' notice that their warranties have
expired,
(iii)assisting the Board with the preparation of public
disclosure documents for Nasdaq and the SEC,
(iv) assisting Purus' lawyers in developing strategies, preparing
documents, and providing declarations and depositions to
defend against the pending Class Action lawsuit and toxic
emissions lawsuit, and other lawsuits that may arise from
Purus' obligations under purchase contracts with former
customers,
(v) presenting to the Board for its review and approval such
things as invoices, purchase requisitions, contracts, and
settlement agreements, along with appropriate justification,
that are connected with the preceding activities, and
(vi) other activities and assistance that the Board may request
and that Burbank may agree to provide, provided however, that
such other activities are not related to matters connected
with corporate governance, stockholder relations, or new
business development.
5.04 Consulting Agreement Conditions: Burbank shall provide consulting
services to Purus' Board subject to the following conditions:
a) Burbank acknowledges that all information and communications
between Purus and Burbank concerning the subject matter of
the Consulting Agreement are confidential and are trade and
business practice secrets unless specifically otherwise
classified by Purus in writing. Burbank agrees to keep all
such information confidential and secret, and to maintain and
require the maintenance of systems and procedures designed to
preserve the secrecy and confidentiality of all
communications and information provided by Purus to Burbank
pursuant to this Consulting Agreement. Burbank shall not
disclose any portion of any information provided to Burbank
by Purus pursuant to this Consulting Agreement without the
prior written consent of Purus, except to his accountants,
attorneys and business consultants.
b) All work, results, reports, recommendations, conclusions,
data and work product of whatever nature created by Burbank
for Purus pursuant to this Consulting Agreement is work for
hire, the exclusive property of Purus, secret and
confidential, and subject to the confidentiality and secrecy
requirements of subpart (a) above. Burbank shall hold all of
the foregoing work and work product in trust for the
exclusive benefit of Purus, and subject to the direction of
Purus concerning its maintenance, dissemination, return and
destruction. Burbank shall request Purus to authorize the
release of any and all such information Burbank believes is
necessary for optimal performance of the Consulting
Agreement.
c) Burbank shall not subcontract to others for or assign the
performance of any of the services to be performed by Burbank
pursuant to this Consulting Agreement without the prior
written consent of Purus.
d) Subject to the provisions of this Consulting Agreement,
Burbank shall have complete control over the manner in which
he provides services hereunder, and Burbank shall maintain
his autonomy as an independent contractor separate from Purus
with his own business office, over which Burbank shall
continue to exercise complete and autonomous control during
his performance of this Consulting Agreement. Burbank is
retained by Purus as an independent contractor, and no
employer-employee relationship, joint venture or any other
business relationship other than involving an independent
contractor relationship is created by this Consulting
Agreement.
e) In the performance of all services to be performed by Burbank
pursuant to this Consulting Agreement, Burbank shall comply
with all applicable United States Laws and Regulations.
f) Burbank shall not hold himself out as or represent that he is
an agent, employee or legal representative of Purus in any
capacity or for any purpose whatsoever. Burbank shall have
no power or authority to incur or create any obligations or
liability of any kind for or on behalf of Purus.
6. Mutual Release:
6.01 Upon the full payment of all moneys due Burbank under Section 1
herein, Burbank and each of Purus, the Committee, and Friedli,
individually and collectively agree that such payment by Purus
shall be payment in full of all moneys due from Purus to Burbank
and a full and complete and accord and satisfaction of all
obligations of Purus and its officers, directors, stockholders,
employees, agents, successors and assigns to Burbank,
individually, or in any other capacity.
6.02 Upon the full payment of all moneys due Burbank under Section 1
herein, thereupon and not before, Burbank shall give a full and
complete waiver of all claims, including, but not limited to,
claims of wrongful discharge, breach of contract, breach of the
covenant of good faith and fair dealing, violation of public
policy, defamation, personal injury, emotional distress, claims
under Title VII of the Civil Rights Act of 1964, as amended, the
Fair Labor Standards Act, the California Fair Employment and
Housing Act, the Equal Pay Act of 1963, California Labor Code
Section 1197.5, the Age Discrimination in Employment Act of 1967,
and any other state or federal laws and regulations relating to
employment or employment discrimination. Burbank further
understands that by this Release, he agrees not to assist,
encourage, institute, or cause to be instituted the filing of any
administrative charge or proceeding against Purus relating to
employment or employment discrimination, excluding any claims he
might have for unemployment insurance benefits, state disability
compensation, and/or workers' compensation benefits.
6.03 Nothing herein shall, however, waive any right or indemnification
of Burbank pursuant to the obligation to indemnify as set forth in
Purus bylaws.
6.04 Upon the full execution of this Agreement, Purus, the Committee,
and Friedli, collectively and individually fully and forever
release and discharge Burbank from any claims and damages and
causes of action it may have against him and covenants not to sue
or otherwise institute or cause to be instituted or in any way
participate in legal or administrative proceedings against Burbank
with respect to any matter arising out of or connected with
Burbank's employment with Company or the termination of that
employment, including any and all liabilities, claims, demands,
contracts, debts, obligations and causes of action of every
nature, kind and description, in law, equity, or otherwise,
whether or not now known or ascertained, which heretofore do or
may exist; provided, however, no claim is released on account of
any act by Burbank which was a knowing and willful violation of
law.
6.05 The parties also agree, individually and collectively, that
nothing contained in this Release shall constitute or be treated
as an admission of liability or wrongdoing by Burbank, Purus,
Friedli, or the Committee.
7. Waiver of Provisions of California Civil Code Section 1542: Concerning
the Section 5 Release of the Agreement, each of Burbank, Purus, Friedli
and the Committee, hereby waive the provisions of California Civil Code
Section 1542, which provides in pertinent part:
"A general release does not extend to claims to which
the creditor does not know or it suspects 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."
8. Notices: All notices and invoices shall be in writing, and shall be
sent to the parties at the following addresses:
To Burbank:
Russell K. Burbank
224 Corte Madera Avenue
Mill Valley, CA 94941
Tel: 415-381-9229
Fax: 415-381-9779
To Purus:
Purus, Inc.
600 California Street, Suite 1300
San Francisco, CA 94108
Tel: (415) 788-1903
Fax: (415) 788-2415
To Friedli:
Friedli Corporate Finance AG
Freigutstrasse 5
Zurich, Switzerland CH-8002
Attn.: Peter Friedli
Tel: 011-41-1-201-4919
Fax: 011-41-1-201-7819
To The Committee:
Friedli Corporate Finance AG
Freigutstrasse 5
Zurich, Switzerland CH-8002
Attn.: Peter Friedli
Tel: 011-41-1-201-4919
Fax: 011-41-1-201-7819
Written notices sent via premium mail service, such as DHL, FedEx, Overseas
Express Mail, etc., shall be deemed received upon either confirmation of
delivery by the premium mail carrier, or upon the first notification by the
premium mail carrier of an attempt to deliver, whether successful or not.
Notices sent via any other type of mail shall be deemed received only
following actual receipt by the recipient. Notices transmitted via fax
shall be deemed received immediately upon the actual confirmed receipt of
the fax notice, if the notice is received in its entirety prior to 4:00 p.m.
on a business day in the place of receipt. Notices which are not received
in their entirety prior to 4:00 p.m. on a business day in the place of
receipt shall be deemed received at 9:00 a.m. on the next succeeding
business day in the place of receipt.
9. General Provisions:
9.01 Binding Agreement: This Agreement shall be binding upon and inure
to the benefit of the heirs, personal representatives, subrogors,
predecessors, assignors, successors and assigns of each of the
parties. The representations of the parties in this Agreement are
their warranties, and are each incorporated into this Agreement in
full.
9.02 Entire Agreement: This Agreement constitutes the entire agreement
between the parties and supersedes all prior negotiations,
communications, discussions and correspondence concerning the
subject matter of this Agreement. This Agreement may only be
modified by a writing executed by all of the parties this
Agreement.
9.03 Governing Law; Jurisdiction and Venue: This Agreement shall be
governed by and construed in accordance with the laws of the State
of California. Jurisdiction and Venue shall be proper in any
California Court of competent jurisdiction. Service of process
shall be in accordance with the California Code of Civil Procedure
and California law concerning service of process. To the extent
any provisions of any treaty or agreement which the United States
and Switzerland are signatories contradicts the provisions of the
California Code of Civil Procedure, the California Code of Civil
Procedure shall prevail. If personal service can not be made upon
any party to this Agreement, after the exercise of reasonable
diligence, each party to this Agreement appoints the Secretary of
State of the State of California as his, her, or its duly
appointed agent for service of process.
9.04 Validity of Agreement: If any portion or any provision of this
Agreement shall be prohibited by or be invalid under applicable
law, such provision shall be ineffective only to the extent of
such prohibition or invalidity without invalidating the remainder
of such provision or any remaining portion or provision of this
Agreement, which shall remain valid and fully enforceable against
the parties to this Agreement.
9.05 Execution in Counterpart: This Agreement may be executed in
multiple counterparts. Each iteration of this Agreement bearing,
in the aggregate, the original signatures of all of the parties to
this Agreement, whether or not all such signatures are contained
on the same page, shall be deemed a duplicate original of this
Agreement, and shall be enforceable as such. Transmission of a
facsimile of this Agreement shall be deemed the promise of the
transmitting party to promptly provide the other party or parties
with the original of this Agreement bearing the original of his,
her, or its signature upon demand of any party. The failure of
any party to promptly deliver to a demanding party such original
document bearing the original signature of the party to whom the
demand is directed shall be conclusively deemed to be the
stipulation and agreement of the party to whom the demand is
directed that he, she or it executed this Agreement, and that the
facsimile bearing the signature of the party to whom the demand is
directed, or a true copy thereof, is an original signature of such
party for all purposes, including enforcement of this Agreement in
a court or other proceeding or action.
IN WITNESS WHEREOF: the parties hereto have each duly executed this
Agreement as of the date first written above as if this Agreement were
executed in the City and County of San Francisco, California.
Russell K. Burbank, Individually and In All Other Capacities:
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By: Russell K. Burbank,
PURUS, INC.:
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By: Reinhard Siegrist
Director
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By: Hans Ochsner
Director
Peter Friedli, Individually and In All Other Capacities:
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By: Peter Friedli
The Purus Stockholders Protective Committee:
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By: Peter Friedli
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By: Hans Ochsner