TSSI 8-K
TSS, Inc. (TSSI)
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Item 5.02.
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Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
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Item 9.01
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Financial Statements and Exhibits
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99.1
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99.2
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99.3
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99.4
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99.5
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104
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Cover Page Interactive Data File (embedded within the Inline XBRL document).
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TSS, INC.
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By:
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/s/ John Penver
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John Penver
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Chief Financial Officer
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Exhibit 99.1
TSS, INC. REPORTS THIRD QUARTER 2022 RESULTS
ROUND ROCK, TX – November 14, 2022 – TSS, Inc. (Other OTC: TSSI), a data center facilities and technology services company, reported results for its third quarter ended September 30, 2022.
Third Quarter Highlights (unaudited):
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Third quarter 2022 revenue of $8.1 million compared with $4.6 million in the third quarter of 2021. |
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Gross margin of 34% in the third quarter of 2022 compared with 42% in the third quarter of 2021. |
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Operating income of $871,000 in the third quarter of 2022 compared to operating income of $228,000 in the third quarter of 2021. |
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Net income of $605,000 or $0.03 per share in the third quarter of 2022 compared to net income of $123,000 or $0.01 per share in the third quarter of 2021. |
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Adjusted EBITDA income of $1,043,000 in the third quarter of 2022 compared with Adjusted EBITDA income of $476,000 in the third quarter of 2021. |
Year-to-date Highlights (unaudited):
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2022 revenue of $19.7 million compared with $12.8 million in 2021. Reseller revenues were $5.6 million in 2022 compared to $3.0 million in 2021. |
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Gross margin of 36% in 2022 and 2021. |
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Operating income of $1,637,000 compared to an operating loss of $730,000 in 2021. |
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Net income of $1,068,000 or $0.05 per share in 2022 compared to a net loss of $1,032,000 or $(0.06) per share in 2021. |
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Adjusted EBITDA income of $2,202,000 in 2022 compared with Adjusted EBITDA income of $36,000 in 2021. |
Prior to this earnings release, TSS announced the appointment of Darryll Dewan as President and CEO. Dewan commented, “I am looking forward to furthering my understanding of our business. It is clear the third quarter results reflect growth across all of our business units and strong net income and adjusted EBITDA. We expect to see strong demand continue into the fourth quarter. I will communicate further with our investors as I gain greater insight into our long-term strategy and investments we may consider in our business to maintain and expand our leadership in the data center infrastructure and IT services sectors.”
Quarterly Conference Call Details
The Company has scheduled a conference call to discuss the third quarter 2022 financial results for Monday, November 14, 2022, at 4:30 PM Eastern. To participate on the conference call, please dial 1-888-596-4144 toll free from the U.S., or 1-646-968-2525 for international callers. The event ID number is 3130474. Investors may also access a live audio web cast of this conference call under the “events” tab on the investor relations section of the Company's website at www.tssiusa.com.
An audio replay of the conference call will be available approximately four hours after the conclusion of the call and will be made available until December 14, 2022. The audio replay can be accessed at the following url: EVENT | ECHO PLAYBACK (registrations.events)
The conference ID to access the digital playback is 3130474. Additionally, a replay of the webcast will be available on the Company’s website approximately two hours after the conclusion of the call and will remain available for 30 calendar days.
About Non-GAAP Financial Measures
Adjusted EBITDA is a supplemental financial measure not defined under Generally Accepted Accounting Principles (GAAP). We define Adjusted EBITDA as net income (loss) before interest expense, income taxes, depreciation and amortization, impairment loss on goodwill and other intangibles, stock-based compensation, and provision for bad debts. We present Adjusted EBITDA because we believe this supplemental measure of operating performance is helpful in comparing our operating results across reporting periods on a consistent basis by excluding non-cash items that may, or could, have a disproportionate positive or negative impact on our results of operations in any particular period. We also use Adjusted EBITDA as a factor in evaluating the performance of certain management personnel when determining incentive compensation.
Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies. Adjusted EBITDA, while providing useful information, should not be considered in isolation or as an alternative to net income or cash flows as determined under GAAP. Consistent with Regulation G under the U.S. federal securities laws, Adjusted EBITDA has been reconciled to the nearest GAAP measure, and this reconciliation is located under the heading “Adjusted EBITDA Reconciliation” following the Consolidated Statements of Operations included in this press release.
About TSS, Inc.
TSS is a trusted single source provider of mission-critical planning, design, system integration, deployment, maintenance and evolution of data centers facilities and information infrastructure. TSS specializes in customizable end to end solutions powered by industry experts and innovative services that include technology consulting, engineering, design, construction, operations, facilities management, technology system installation and integration, as well as maintenance for traditional and modular data centers. For more information, visit www.tssiusa.com or call 888-321-4877.
Forward Looking Statements
This press release may contain “forward-looking statements” -- that is, statements related to future -- not past -- events, plans, and prospects. In this context, forward-looking statements may address matters such as our expected future business and financial performance, and often contain words such as “guidance,” “prospects,” “expects,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” “should,” or “will.” Forward-looking statements by their nature address matters that are, to different degrees, uncertain. Particular uncertainties that could adversely or positively affect the Company's future results include: we may not have sufficient resources to fund our business and may need to issue debt or equity to obtain additional funding; our reliance on a significant portion of our revenues from a limited number of customers; risks relating to operating in a highly competitive industry; risks relating to the failure to maintain effective internal control over financial reporting; risks relating to rapid technological, structural, and competitive changes affecting the industries we serve; risks involved in properly managing complex projects; risks relating to the possible cancellation of customer contracts on short notice; risks relating our ability to continue to implement our strategy, including having sufficient financial resources to carry out that strategy; risks relating to our ability to meet all of the terms and conditions of our debt obligations; uncertainty related to current economic conditions including the impact of the COVID-19 pandemic and the related impact on demand for our services; and other risks and uncertainties disclosed in our filings with the Securities and Exchange Commission, including the Annual Report on Form 10-K for the fiscal year ended December 31, 2021. These uncertainties may cause our actual future results to be materially different than those expressed in our forward-looking statements. We do not undertake to update our forward-looking statements.
Company Contact:
TSS, Inc.
John Penver, CFO
Phone: (512) 310-1000
TSS, Inc.
Consolidated Balance Sheets
(In thousands except par values)
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September 30, |
December 31, |
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2022 |
2021 |
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(unaudited) |
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Assets |
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Current Assets |
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Cash and cash equivalents |
$ | 9,605 | $ | 7,992 | ||||
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Contract and other receivables, net |
3,046 | 1,846 | ||||||
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Costs and estimated earnings in excess of billings on uncompleted contracts |
3,098 | 573 | ||||||
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Inventories, net |
1,739 | 847 | ||||||
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Prepaid expenses and other current assets |
291 | 550 | ||||||
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Total current assets |
17,779 | 11,808 | ||||||
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Property and equipment, net |
314 | 281 | ||||||
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Lease right-of-use assets |
5,050 | 5,566 | ||||||
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Goodwill |
780 | 780 | ||||||
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Intangible assets, net |
58 | 126 | ||||||
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Other assets |
908 | 720 | ||||||
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Total assets |
$ | 24,889 | $ | 19,281 | ||||
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Liabilities and Stockholders’ Equity |
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Current Liabilities |
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Accounts payable and accrued expenses |
$ | 11,619 | $ | 7,016 | ||||
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Deferred revenues |
4,274 | 2,435 | ||||||
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Current portion of long-term borrowings |
- | 2,023 | ||||||
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Current portion of lease liabilities |
621 | 644 | ||||||
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Total current liabilities |
16,514 | 12,118 | ||||||
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Non-current portion of lease liabilities |
4,469 | 4,938 | ||||||
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Non-current portion of deferred revenues |
- | 22 | ||||||
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Total liabilities |
20,983 | 17,078 | ||||||
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Stockholders’ Equity |
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Preferred stock- $.0001 par value; 1,000 shares authorized at September 30, 2022 and December 31, 2021; none issued |
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Common stock- $.0001 par value, 49,000 shares authorized at September 30, 2022 and December 31, 2021: 22,917 and 20,286 shares issued at September 30, 2022 and December 31, 2021, respectively |
2 | 2 | ||||||
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Additional paid-in capital |
71,299 | 70,584 | ||||||
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Treasury stock 1,572 and 1,424 shares at cost at September 30, 2022 and December 31, 2021, respectively |
(2,151 | ) | (2,071 | ) | ||||
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Accumulated deficit |
(65,244 | ) | (66,312 | ) | ||||
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Total stockholders' equity |
3,906 | 2,203 | ||||||
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Total liabilities and stockholders’ equity |
$ | 24,889 | $ | 19,281 | ||||
TSS, Inc.
Condensed Consolidated Statements of Operations
(In thousands except per-share values, unaudited)
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Three Months Ended |
Nine Months Ended |
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September 30, |
September 30, |
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2022 |
2021 |
2022 |
2021 |
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Results of Operations: |
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Revenue |
$ | 8,077 | $ | 4,587 | $ | 19,690 | $ | 12,825 | ||||||||
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Cost of revenue |
5,312 | 2,666 | 12,647 | 8,147 | ||||||||||||
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Gross profit |
2,675 | 1,921 | 7,043 | 4,678 | ||||||||||||
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Operating expenses: |
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Selling, general and administrative expenses |
1,826 | 1,560 | 5,158 | 5,002 | ||||||||||||
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Depreciation and amortization |
68 | 133 | 248 | 406 | ||||||||||||
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Total operating costs |
1,894 | 1,693 | 5,406 | 5,408 | ||||||||||||
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Income (loss) from operations |
871 | 228 | 1,637 | (730 | ) | |||||||||||
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Interest income (expense), net |
(255 | ) | (83 | ) | (537 | ) | (271 | ) | ||||||||
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Income (loss) from operations before income taxes |
616 | 145 | 1,100 | (1,001 | ) | |||||||||||
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Income tax expense |
11 | 22 | 32 | 31 | ||||||||||||
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Net income (loss) |
$ | 605 | $ | 123 | $ | 1,068 | $ | (1,032 | ) | |||||||
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Basic net income (loss) per share: |
$ | 0.03 | $ | 0.01 | $ | 0.05 | $ | (0.06 | ) | |||||||
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Diluted net income (loss) per share: |
$ | 0.03 | $ | 0.01 | $ | 0.05 | $ | (0.06 | ) | |||||||
TSS, Inc.
Adjusted EBITDA Reconciliation
(In thousands, unaudited)
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Three Months Ended |
Nine Months Ended |
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September 30, |
September 30, |
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2022 |
2021 |
2022 |
2021 |
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Net income (loss) |
$ | 605 | $ | 123 | $ | 1,068 | $ | (1,032 | ) | |||||||
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Interest expense (income), net |
255 | 83 | 537 | 271 | ||||||||||||
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Depreciation and amortization |
68 | 133 | 248 | 406 | ||||||||||||
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Income tax expense |
11 | 22 | 32 | 31 | ||||||||||||
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EBITDA profit (loss) |
$ | 939 | $ | 361 | $ | 1,885 | $ | (324 | ) | |||||||
| 104 | 115 | 317 | 360 | |||||||||||||
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Stock based compensation |
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Adjusted EBITDA profit |
$ | 1,043 | $ | 476 | $ | 2,202 | $ | 36 | ||||||||
Exhibit 99.2
TSS, INC. ANNOUNCES DARRYLL DEWAN SUCCEEDS ANTHONY ANGELINI AS PRESIDENT & CEO.
ROUND ROCK, TX – November 14, 2022 – TSS, Inc. (Other OTC: TSSI), a data center facilities and technology services company, today announced that Darryll Dewan is succeeding Anthony Angelini as President and CEO of TSS. Mr. Dewan was also appointed to the Board of Directors of TSS.
“TSS has been resilient and has transformed itself in many ways over the last ten years. The Board of Directors is very appreciative of the efforts of the team under Anthony’s leadership that have helped us to succeed. The timing of this change could not be better. The Company is in an exciting time with a solid foundation financially and operationally. We are pleased to have Darryll join and drive the next level of growth. Darryll brings decades of experience successfully growing businesses. He is a proven leader and throughout his career has created tremendous wealth for investors,” said Peter Woodward, Chairman of the Board of Directors of TSS.
Anthony Angelini commented, “I am very excited to have Darryll lead TSS. I believe he is the right person at the right time. I appreciate the collective support from the Board and the Company in assisting this transition. I am extremely confident that Darryll will take this business to new heights. I want to thank everyone for all of their support for the past decade as we reinvented TSS. Welcome, Darryll.”
“This is a great opportunity to join TSS,” said Darryll Dewan. “The Company has tremendous opportunities. The marketplace we support is evolving and we must demonstrate our ability to scale our business. I look forward to driving our strategic direction as CEO.”
Dewan is an industry veteran with over 30 years of experience leading various managed service organizations supporting the IT industry. Prior to his role at TSS, he was Vice President – Global Sales and Field Marketing for Dell Technologies. He has extensive executive level sales and service experiences with Credant Technologies, VA Software Solutions, and was President of i2 Technologies. Dewan’s early career was spent at IBM.
About TSS, Inc.
TSS is a trusted single source provider of mission-critical planning, design, system integration, deployment, maintenance and evolution of data centers facilities and information infrastructure. TSS specializes in customizable end to end solutions powered by industry experts and innovative services that include technology consulting, engineering, design, construction, operations, facilities management, technology system installation and integration, as well as maintenance for traditional and modular data centers. For more information, visit www.tssiusa.com or call 888-321-4877.
Forward Looking Statements.
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements. These statements are based on management’s current assumptions and are neither promises nor guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. For factors that could cause actual results to differ materially from the forward-looking statements in this press release, please see the risks and uncertainties identified under the heading “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2021 filed with the SEC, as such factors may be updated from time to time in our other filings with the SEC, which are accessible on the SEC website at www.sec.gov and on our Investor Relations website at www.tssiusa.com. All forward-looking statements reflect our beliefs and assumptions only as of the date of this press release. TSS undertakes no obligation to update forward-looking statements to reflect future events or circumstances.
Company Contact:
TSS, Inc.
John Penver, CFO
Phone: (512) 310-1000
Exhibit 99.3
Employment Agreement
This Employment Agreement (the “Agreement”) is made and entered into as of November 14, 2022, by and between Darryll Dewan (the “Executive”) and TSS, Inc., a Delaware corporation (the “Company”).
WHEREAS, the Company desires to employ the Executive on the terms and conditions set forth herein; and
WHEREAS, the Executive desires to be employed by the Company on such terms and conditions.
NOW, THEREFORE, in consideration of the mutual covenants, promises, and obligations set forth herein, the parties agree as follows:
1. Term. The Executive’s employment hereunder shall be effective as of November 14, 2022 (the “Effective Date”) and shall continue until the first anniversary thereof, unless terminated earlier pursuant to Section 5 of this Agreement; provided that, on such first anniversary of the Effective Date and each annual anniversary thereafter (such date and each annual anniversary thereof, a “Renewal Date”), the Agreement shall be deemed to be automatically extended, upon the same terms and conditions, for successive periods of one year, unless either party provides written notice of its intention not to extend the term of the Agreement at least 60 days prior to the applicable Renewal Date. The period during which the Executive is employed by the Company hereunder is hereinafter referred to as the “Employment Term.”
2. Position and Duties.
2.1 Position. During the Employment Term, the Executive shall serve as the President and Chief Executive Officer of the Company, reporting to Board of Directors. In such position, the Executive shall have such duties, authority, and responsibilities as shall be determined from time to time by Board of Directors, which duties, authority, and responsibilities are consistent with the Executive’s position. The Executive shall, if requested, also serve as a member of the board of directors of the Company (the “Board”) or as an officer or director of any affiliate of the Company for no additional compensation.
2.2 Duties. During the Employment Term, the Executive shall devote substantially all of the Executive’s business time and attention to the performance of the Executive’s duties hereunder and will not engage in any other business, profession, or occupation for compensation or otherwise which would conflict or interfere with the performance of such services either directly or indirectly without the prior written consent of the Board. Notwithstanding the foregoing, the Executive will be permitted to (a) with the prior written consent of the Board (which consent can be withheld by the Board in its discretion) act or serve as a director, trustee, committee member, or principal of any type of business, civic, or charitable organization, and (b) purchase or own less than five percent (5%) of the publicly traded securities of any corporation; provided that, such ownership represents a passive investment and that the Executive is not a controlling person of, or a member of a group that controls, such corporation; provided further that, the activities described in clauses (a) and (b) do not interfere with the performance of the Executive’s duties and responsibilities to the Company as provided hereunder.
3. Place of Performance. The principal place of Executive’s employment shall be the Company’s principal executive office currently located in Round Rock, Texas; provided that, the Executive may be required to travel on Company business during the Employment Term.
4. Compensation.
4.1 Base Salary. The Company shall pay the Executive an annual base salary of $385,000 in periodic installments in accordance with the Company’s customary payroll practices and applicable wage payment laws, but no less frequently than monthly. The Executive’s annual base salary, as in effect from time to time, is hereinafter referred to as “Base Salary”.
4.2 Annual Bonus.
(a) For each calendar year of the Employment Term, the Executive shall be eligible to receive an annual bonus (the “Annual Bonus”) in an amount initially targeted to be fifty percent (50%) of Base Salary. Notwithstanding the foregoing, the decision to provide any Annual Bonus and the amount and terms of any Annual Bonus shall be in the sole and absolute discretion of the Compensation Committee of the Board.
(b) The Annual Bonus, if any, will be paid during the calendar year immediately following the applicable calendar year and in no event later than fifteen (15) days following the date the Company’s annual audit for the applicable fiscal year has been finalized and delivered.
(c) Except as otherwise provided in Section 5, in order to be eligible to receive an Annual Bonus, the Executive must be employed by the Company on the date that Annual Bonuses are paid.
4.3 Equity Awards. In consideration of the Executive entering into this Agreement and as an inducement to join the Company, on the Effective Date, the Company will grant to the Executive options to purchase one million two hundred fifty thousand (1,250,000) shares of the Company’s common stock, which shall vest in three equal installments on the first, second, and third anniversaries of the Effective Date. All other terms and conditions of such awards shall be governed by the terms and conditions of the award agreement governing such options.
4.4 Housing Allowance. During the first twelve (12) months of the Employment Term, the Executive shall receive a housing allowance of $5,000 per month.
4.5 Employee Benefits. During the Employment Term, the Executive shall be entitled to participate in all employee benefit plans, practices, and programs maintained by the Company, as in effect from time to time (collectively, “Employee Benefit Plans”), on a basis which is no less favorable than is provided to other similarly situated executives of the Company, to the extent consistent with applicable law and the terms of the applicable Employee Benefit Plans. The Company reserves the right to amend or terminate any Employee Benefit Plans at any time in its sole discretion, subject to the terms of such Employee Benefit Plan and applicable law.
4.6 Vacation; Paid Time Off. During the Employment Term, the Executive will be entitled to paid vacation on a basis that is at least as favorable as that provided to other similarly situated executives of the Company. The Executive shall receive other paid time off in accordance with the Company’s policies for executive officers as such policies may exist from time to time.
4.7 Business Expenses. The Executive shall be entitled to reimbursement for all reasonable and necessary out-of-pocket business, entertainment, and travel expenses incurred by the Executive in connection with the performance of the Executive’s duties hereunder in accordance with the Company’s expense reimbursement policies and procedures.
4.8 Indemnification. In the event that the Executive is made a party or threatened to be made a party to any action, suit, or proceeding, whether civil, criminal, administrative, or investigative (a “Proceeding”), other than any Proceeding initiated by the Executive or the Company related to any contest or dispute between the Executive and the Company or any of its affiliates with respect to this Agreement or the Executive’s employment hereunder, by reason of the fact that the Executive is or was a director or officer of the Company, or any affiliate of the Company, or is or was serving at the request of the Company as a director, officer, member, employee, or agent of another corporation or a partnership, joint venture, trust, or other enterprise, the Executive shall be indemnified and held harmless by the Company to the maximum extent permitted under applicable law and the Company’s bylaws from and against any liabilities, costs, claims, and expenses, including all costs and expenses incurred in defense of any Proceeding (including attorneys’ fees). Costs and expenses incurred by the Executive in defense of such Proceeding (including attorneys’ fees) shall be paid by the Company in advance of the final disposition of such litigation upon receipt by the Company of: (i) a written request for payment; (ii) appropriate documentation evidencing the incurrence, amount, and nature of the costs and expenses for which payment is being sought; and (iii) an undertaking adequate under applicable law made by or on behalf of the Executive to repay the amounts so paid if it shall ultimately be determined that the Executive is not entitled to be indemnified by the Company under this Agreement.
5. Termination of Employment. The Employment Term and the Executive’s employment hereunder may be terminated by either the Company or the Executive at any time and for any reason; provided that, unless otherwise provided herein, either party shall be required to give the other party at least 30 days advance written notice of any termination of the Executive’s employment. On termination of the Executive’s employment during the Employment Term, the Executive shall be entitled to the compensation and benefits described in this Section 5 and shall have no further rights to any compensation or any other benefits from the Company or any of its affiliates.
5.1 Non-Renewal by the Executive, For Cause, or Without Good Reason.
(a) The Executive’s employment hereunder may be terminated upon the Executive’s failure to renew the Agreement in accordance with Section 1, by the Company for Cause, or by the Executive without Good Reason. If the Executive’s employment is terminated upon the Executive’s failure to renew the Agreement, by the Company for Cause, or by the Executive without Good Reason, the Executive shall be entitled to receive:
(i) any accrued but unpaid Base Salary and accrued but unused vacation which shall be paid within one (1) week following the Termination Date (as defined below);
(ii) reimbursement for unreimbursed business expenses properly incurred by the Executive, which shall be subject to and paid in accordance with the Company’s expense reimbursement policy; and
(iii) such employee benefits (including equity compensation), if any, to which the Executive may be entitled under the Company’s employee benefit plans as of the Termination Date; provided that, in no event shall the Executive be entitled to any payments in the nature of severance or termination payments except as specifically provided herein.
Items 5.1(a)(i) through 5.1(a)(iii) are referred to herein collectively as the “Accrued Amounts”.
(b) For purposes of this Agreement, “Cause” shall mean:
(i) the Executive’s failure to perform Executive’s duties (other than any such failure resulting from incapacity due to physical or mental illness);
(ii) the Executive’s failure to comply with any valid and legal directive of the Board of Directors;
(iii) the Executive’s engagement in dishonesty, illegal conduct, or misconduct, which is, in each case, injurious to the Company or its affiliates;
(iv) the Executive’s embezzlement, misappropriation, or fraud, whether or not related to the Executive’s employment with the Company;
(v) the Executive’s conviction of or plea of guilty or nolo contendere to a crime that constitutes a felony (or state law equivalent) or a crime that constitutes a misdemeanor involving moral turpitude;
(vi) the Executive’s violation of the Company’s written policies or codes of conduct, including written policies related to discrimination, harassment, performance of illegal or unethical activities, and ethical misconduct;
(vii) the Executive’s willful unauthorized disclosure of Confidential Information (as defined below);
(viii) the Executive’s material breach of any material obligation under this Agreement or any other written agreement between the Executive and the Company; or
(ix) the Executive’s engagement in conduct that brings or is reasonably likely to bring the Company negative publicity or into public disgrace, embarrassment, or disrepute.
Except for a failure, breach, or refusal which, by its nature, cannot reasonably be expected to be cured, the Executive shall have ten (10) business days from the delivery of written notice by the Company within which to cure any acts constituting Cause; provided however, that, if the Company reasonably expects irreparable injury from a delay of ten (10) business days, the Company may give the Executive notice of such shorter period within which to cure as is reasonable under the circumstances, which may include the termination of the Executive’s employment without notice and with immediate effect. The Company may place the Executive on paid leave for up to 30 days while it is determining whether there is a basis to terminate the Executive’s employment for Cause. Any such action by the Company will not constitute Good Reason.
(c) For purposes of this Agreement, “Good Reason” shall mean the occurrence of any of the following, in each case during the Employment Term without the Executive’s written consent:
(i) a material reduction in the Executive’s Base Salary other than a general reduction in Base Salary that affects all similarly situated executives in substantially the same proportions; or
(ii) any material breach by the Company of any material provision of this Agreement.
The Executive cannot terminate employment for Good Reason unless the Executive has provided written notice to the Company of the existence of the circumstances providing grounds for termination for Good Reason within 30 days of the initial existence of such grounds and the Company has had at least 30 days from the date on which such notice is provided to cure such circumstances. If the Executive does not terminate employment for Good Reason within 30 days after the first occurrence of the applicable grounds, then the Executive will be deemed to have waived the right to terminate for Good Reason with respect to such grounds.
5.2 Non-Renewal by the Company, Without Cause, or for Good Reason. The Employment Term and the Executive’s employment hereunder may be terminated by the Executive for Good Reason or by the Company without Cause or on account of the Company’s failure to renew the Agreement in accordance with Section 1. In the event of such termination, the Executive shall be entitled to receive the Accrued Amounts and subject to the Executive’s compliance with Section 6, Section 7, Section 8, and Section 9 of this Agreement and the Executive’s execution of a release of claims in favor of the Company, its affiliates and their respective officers and directors in a form provided by the Company (the “Release”) and such Release becoming effective within 10 days following the Termination Date (such 10-day period, the “Release Execution Period”), the Executive shall be entitled to receive the following:
(a) if the Employment Term and the Executives employment hereunder is terminated under this Section 5.2 within twelve (12) months following the Effective Date, continued Base Salary for three (3) months following the Termination Date payable in equal installments in accordance with the Company’s normal payroll practices, but no less frequently than monthly, which shall commence within 14 days following the Termination Date;
(b) if the Employment Term and the Executives employment hereunder is terminated under this Section 5.2 following the first anniversary of the Effective Date, continued Base Salary for twelve (12) months following the Termination Date payable in equal installments in accordance with the Company’s normal payroll practices, but no less frequently than monthly, which shall commence within 14 days following the Termination Date; and
(c) a payment equal to the product of (i) the Annual Bonus, if any, that the Executive would have earned for the calendar year in which the Termination Date (as determined in accordance with Section 5.5) occurs based on achievement of the applicable performance goals for such year and (ii) a fraction, the numerator of which is the number of days the Executive was employed by the Company during the year of termination and the denominator of which is the number of days in such year (the “Pro-Rata Bonus”). This amount shall be paid on the date that annual bonuses are paid to similarly situated executives.
5.3 Death or Disability.
(a) The Executive’s employment hereunder shall terminate automatically on the Executive’s death during the Employment Term, and the Company may terminate the Executive’s employment on account of the Executive’s Disability.
(b) If the Executive’s employment is terminated during the Employment Term on account of the Executive’s death or Disability, the Executive (or the Executive’s estate and/or beneficiaries, as the case may be) shall be entitled to receive the following:
(i) the Accrued Amounts; and
(ii) a lump sum payment equal to the Pro-Rata Bonus, if any, that the Executive would have earned for the calendar year in which the Termination Date occurs based on the achievement of applicable performance goals for such year, which shall be payable on the date that annual bonuses are paid to the Company’s similarly situated executives.
Notwithstanding any other provision contained herein, all payments made in connection with the Executive’s Disability shall be provided in a manner which is consistent with federal and state law.
(c) For purposes of this Agreement, “Disability” shall mean a condition that entitles the Executive to receive long-term disability benefits under the Company’s long-term disability plan, or if there is no such plan, the Executive’s inability, due to physical or mental incapacity, to perform the essential functions of the Executive’s job, with or without reasonable accommodation, for one hundred eighty (180) days out of any three hundred sixty-five (365) day period. Any question as to the existence of the Executive’s Disability as to which the Executive and the Company cannot agree shall be determined in writing by a qualified independent physician mutually acceptable to the Executive and the Company. If the Executive and the Company cannot agree as to a qualified independent physician, each shall appoint such a physician and those two physicians shall select a third who shall make such determination in writing. The determination of Disability made in writing to the Company and the Executive shall be final and conclusive for all purposes of this Agreement.
5.4 Notice of Termination. Any termination of the Executive’s employment hereunder by the Company or by the Executive during the Employment Term (other than termination pursuant to Section 5.3(a) on account of the Executive’s death) shall be communicated by written notice of termination (“Notice of Termination”) to the other party hereto in accordance with Section 25. The Notice of Termination shall specify:
(a) The termination provision of this Agreement relied upon;
(b) To the extent applicable, the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated; and
(c) The applicable Termination Date.
5.5 Termination Date. The Executive’s “Termination Date” shall be:
(a) If the Executive’s employment hereunder terminates on account of the Executive’s death, the date of the Executive’s death;
(b) If the Executive’s employment hereunder is terminated on account of the Executive’s Disability, the date that it is determined that the Executive has a Disability;
(c) If the Company terminates the Executive’s employment hereunder for Cause, the date the Notice of Termination is delivered to the Executive;
(d) If the Company terminates the Executive’s employment hereunder without Cause, the date specified in the Notice of Termination, which shall be no less than 30 days following the date on which the Notice of Termination is delivered; provided that, the Company shall have the option to provide the Executive with a lump sum payment equal to 5 days’ Base Salary in lieu of such notice, which shall be paid in a lump sum on the Executive’s Termination Date and for all purposes of this Agreement, the Executive’s Termination Date shall be the date on which such Notice of Termination is delivered;
(e) If the Executive terminates the Executive’s employment hereunder with or without Good Reason, the date specified in the Executive’s Notice of Termination, which shall be no less than 30 days following the date on which the Notice of Termination is delivered; provided that, the Company may waive all or any part of the 30 day notice period for no consideration by giving written notice to the Executive and for all purposes of this Agreement, the Executive’s Termination Date shall be the date determined by the Company; and
(f) If the Executive’s employment hereunder terminates because either party provides notice of non-renewal pursuant to Section 1, the Renewal Date immediately following the date on which the applicable party delivers notice of non-renewal.
Notwithstanding anything contained herein, the Termination Date shall not occur until the date on which the Executive incurs a “separation from service” within the meaning of Section 409A.
5.6 Resignation of All Other Positions. On termination of the Executive’s employment hereunder for any reason, the Executive shall be deemed to have resigned from all positions that the Executive holds as an officer or member of the Board (or a committee thereof) of the Company or any of its affiliates.
6. Cooperation. The parties agree that certain matters in which the Executive will be involved during the Employment Term may necessitate the Executive’s cooperation in the future. Accordingly, following the termination of the Executive’s employment for any reason, to the extent reasonably requested by the Board, the Executive shall cooperate with the Company in connection with matters arising out of the Executive’s service to the Company; provided that, the Company shall make reasonable efforts to minimize disruption of the Executive’s other activities. The Company shall reimburse the Executive for reasonable expenses incurred in connection with such cooperation and, to the extent that the Executive is required to spend substantial time on such matters, the Company shall compensate the Executive at an hourly rate based on the Executive’s Base Salary on the Termination Date.
7. Confidential Information. The Executive understands and acknowledges that during the Employment Term, the Executive will have access to and learn about Confidential Information, as defined below.
7.1 Confidential Information Defined. For purposes of this Agreement, “Confidential Information” includes, but is not limited to, all information not generally known to the public, in spoken, printed, electronic, or any other form or medium, of the Company Group or its businesses, or of any other person or entity that has entrusted information to the Company or its subsidiaries (collectively, the “Company Group”) in confidence. The Executive understands that Confidential Information also includes information that is marked or otherwise identified as confidential or proprietary or that would otherwise appear to a reasonable person to be confidential or proprietary in the context and circumstances in which the information is known or used. The Executive understands and agrees that Confidential Information includes information developed by Executive in the course of employment by the Company as if the Company furnished the same Confidential Information to the Executive in the first instance. Confidential Information shall not include information that is generally available to and known by the public at the time of disclosure to the Executive; provided that, such disclosure is through no direct or indirect fault of the Executive or person(s) acting on the Executive’s behalf.
7.2 Company Creation and Use of Confidential Information. The Executive understands and acknowledges that the Company Group has invested, and continues to invest, substantial time, money, and specialized knowledge into developing its resources, creating a customer base, generating customer and potential customer lists, training its employees, and improving its offerings in the field of data centers. The Executive understands and acknowledges that as a result of these efforts, the Company Group has created, and continues to use and create Confidential Information. This Confidential Information provides the Company Group with a competitive advantage over others in the marketplace.
7.3 Disclosure and Use Restrictions. The Executive agrees and covenants: (i) to treat all Confidential Information as strictly confidential; (ii) not to directly or indirectly disclose, publish, communicate, or make available Confidential Information, or allow it to be disclosed, published, communicated, or made available, in whole or part, to any entity or person whatsoever (including other employees of the Company Group) not having a need to know and authority to know and use the Confidential Information in connection with the business of the Company Group and, in any event, not to anyone outside of the direct employ of the Company Group except as required in the performance of the Executive’s authorized employment duties to the Company or with the prior consent of Chairman of Board of Directors acting on behalf of the Company Group in each instance (and then, such disclosure shall be made only within the limits and to the extent of such duties or consent); and (iii) not to access or use any Confidential Information, and not to copy any documents, records, files, media, or other resources containing any Confidential Information, or remove any such documents, records, files, media, or other resources from the premises or control of the Company Group, except as required in the performance of the Executive’s authorized employment duties to the Company or with the prior consent of Chairman of Board of Directors acting on behalf of the Company Group in each instance (and then, such disclosure shall be made only within the limits and to the extent of such duties or consent).
7.4 Permitted disclosures. Nothing herein shall be construed to prevent disclosure of Confidential Information as may be required by applicable law or regulation, or pursuant to the valid order of a court of competent jurisdiction or an authorized government agency, provided that the disclosure does not exceed the extent of disclosure required by such law, regulation, or order.
7.5 Permitted Communications. Nothing herein prohibits or restricts the Executive (or the Executive’s attorney) from initiating communications directly with, responding to an inquiry from, or providing testimony before the Securities and Exchange Commission (SEC), the Financial Industry Regulatory Authority (FINRA), any other self-regulatory organization, or any other federal or state regulatory authority regarding a possible securities law violation.
8. Restrictive Covenants.
8.1 Acknowledgement. The Executive understands that the nature of the Executive’s position gives the Executive access to and knowledge of Confidential Information and places the Executive in a position of trust and confidence with the Company Group. The Executive understands and acknowledges that the intellectual or artistic services the Executive provides to the Company Group are unique, special, or extraordinary. The Executive further understands and acknowledges that the Company Group’s ability to reserve these for the exclusive knowledge and use of the Company Group is of great competitive importance and commercial value to the Company Group, and that improper use or disclosure by the Executive is likely to result in unfair or unlawful competitive activity.
8.2 Non-Competition. Because of the Company Group ‘s legitimate business interest as described herein and the good and valuable consideration offered to the Executive, during the Employment Term and for the two years, to run consecutively, beginning on the last day of the Executive’s employment with the Company, regardless of the reason for the termination and whether employment is terminated at the option of the Executive or the Company Group, the Executive agrees and covenants not to engage in Prohibited Activity within the North America. For purposes of this Section 8, “Prohibited Activity” is activity in which the Executive contributes the Executive’s knowledge, directly or indirectly, in whole or in part, as an employee, employer, owner, operator, manager, advisor, consultant, agent, employee, partner, director, stockholder, officer, volunteer, intern, or any other similar capacity to an entity engaged in the same or similar business as the Company Group, including those engaged in the business of providing technology consulting, design and engineering, project management, systems integration, systems installation, facilities management and IT procurement services. Prohibited Activity also includes activity that may require or inevitably requires disclosure of trade secrets, proprietary information or Confidential Information. Nothing herein shall prohibit the Executive from purchasing or owning less than five percent (5%) of the publicly traded securities of any corporation, provided that such ownership represents a passive investment and that the Executive is not a controlling person of, or a member of a group that controls, such corporation. This Section 8 does not, in any way, restrict or impede the Executive from exercising protected rights to the extent that such rights cannot be waived by agreement or from complying with any applicable law or regulation or a valid order of a court of competent jurisdiction or an authorized government agency, provided that such compliance does not exceed that required by the law, regulation, or order.
8.3 Non-Solicitation of Employees. The Executive agrees and covenants not to directly or indirectly solicit, hire, recruit, attempt to hire or recruit, or induce the termination of employment of any employee of the Company Group, or attempt to do so, for a period of one year beginning on the last day of the Executive’s employment with the Company.
8.4 Non-Solicitation of Customers. The Executive understands and acknowledges that because of the Executive’s experience with and relationship to the Company Group, the Executive will have access to and learn about much or all of the Company Group’s customer information. “Customer Information” includes, but is not limited to, names, phone numbers, addresses, email addresses, order history, order preferences, chain of command, decisionmakers, pricing information, and other information identifying facts and circumstances specific to the customer and relevant to services. The Executive understands and acknowledges that loss of this customer relationship and/or goodwill will cause significant and irreparable harm. The Executive agrees and covenants, during one year, to run consecutively, beginning on the last day of the Executive’s employment with the Company, not to directly or indirectly solicit, contact (including but not limited to e-mail, regular mail, express mail, telephone, fax, instant message, or social media), attempt to contact, or meet with the Company’s current, former or prospective customers for purposes of offering or accepting goods or services similar to or competitive with those offered by the Company. This restriction shall only apply to:
(a) Customers or prospective customers the Executive contacted in any way during the past 12 months;
(b) Customers about whom the Executive has trade secret or confidential information;
(c) Customers who became customers during the Executive’s employment with the Company; and
(d) Customers about whom the Executive has information that is not available publicly.
9. Non-Disparagement. The Executive agrees and covenants that the Executive will not at any time make, publish or communicate to any person or entity or in any public forum any defamatory or disparaging remarks, comments, or statements concerning the Company Group or its businesses, or any of its employees, officers, and existing and prospective customers, suppliers, investors, and other associated third parties. This Section 9 does not, in any way, restrict or impede the Executive from exercising protected rights to the extent that such rights cannot be waived by agreement or from complying with any applicable law or regulation or a valid order of a court of competent jurisdiction or an authorized government agency, provided that such compliance does not exceed that required by the law, regulation, or order.
10. Acknowledgement. The Executive acknowledges and agrees that the services to be rendered by the Executive to the Company are of a special and unique character; that the Executive will obtain knowledge and skill relevant to the Company’s industry, methods of doing business and marketing strategies by virtue of the Executive’s employment; and that the restrictive covenants and other terms and conditions of this Agreement are reasonable and reasonably necessary to protect the legitimate business interest of the Company Group. The Executive further acknowledges that the benefits provided to the Executive under this Agreement, including the amount of the Executive’s compensation reflects, in part, the Executive’s obligations and the Company’s rights under Section 7, Section 8, and Section 9 of this Agreement; that the Executive has no expectation of any additional compensation, royalties or other payment of any kind not otherwise referenced herein in connection herewith; and that the Executive will not suffer undue hardship by reason of full compliance with the terms and conditions of Section 7, Section 8, and Section 9 of this Agreement or the Company’s enforcement thereof.
11. Remedies. In the event of a breach or threatened breach by the Executive of Section 7, Section 8, or Section 9 of this Agreement, the Executive hereby consents and agrees that the Company shall be entitled to seek, in addition to other available remedies, a temporary or permanent injunction or other equitable relief against such breach or threatened breach from any court of competent jurisdiction, and that money damages would not afford an adequate remedy, without the necessity of showing any actual damages, and without the necessity of posting any bond or other security. The aforementioned equitable relief shall be in addition to, not in lieu of, legal remedies, monetary damages, or other available forms of relief.
12. Proprietary Rights.
12.1 Work Product. The Executive acknowledges and agrees that all right, title, and interest in and to all writings, works of authorship, technology, inventions, discoveries, processes, techniques, methods, ideas, concepts, research, proposals, materials, and all other work product of any nature whatsoever, that are created, prepared, produced, authored, edited, amended, conceived, or reduced to practice by the Executive individually or jointly with others during the Employment Term and relate in any way to the business or contemplated business, products, activities, research, or development of the Company or result from any work performed by the Executive for the Company (in each case, regardless of when or where prepared or whose equipment or other resources is used in preparing the same), all rights and claims related to the foregoing, and all printed, physical and electronic copies, and other tangible embodiments thereof (collectively, “Work Product”), as well as any and all rights in and to US and foreign (a) patents, patent disclosures and inventions (whether patentable or not), (b) trademarks, service marks, trade dress, trade names, logos, corporate names, and domain names, and other similar designations of source or origin, together with the goodwill symbolized by any of the foregoing, (c) copyrights and copyrightable works (including computer programs), and rights in data and databases, (d) trade secrets, know-how, and other confidential information, and (e) all other intellectual property rights, in each case whether registered or unregistered and including all registrations and applications for, and renewals and extensions of, such rights, all improvements thereto and all similar or equivalent rights or forms of protection in any part of the world (collectively, “Intellectual Property Rights”), shall be the sole and exclusive property of the Company. For purposes of this Agreement, Work Product includes, but is not limited to, Company Group information.
12.2 Work Made for Hire; Assignment. The Executive acknowledges that, by reason of being employed by the Company at the relevant times, to the extent permitted by law, all of the Work Product consisting of copyrightable subject matter is “work made for hire” as defined in 17 U.S.C. § 101 and such copyrights are therefore owned by the Company. To the extent that the foregoing does not apply, the Executive hereby irrevocably assigns to the Company, for no additional consideration, the Executive’s entire right, title, and interest in and to all Work Product and Intellectual Property Rights therein, including the right to sue, counterclaim, and recover for all past, present, and future infringement, misappropriation, or dilution thereof, and all rights corresponding thereto throughout the world. Nothing contained in this Agreement shall be construed to reduce or limit the Company’s rights, title, or interest in any Work Product or Intellectual Property Rights so as to be less in any respect than that the Company would have had in the absence of this Agreement.
12.3 Further Assurances; Power of Attorney. During and after the Employment Term, the Executive agrees to reasonably cooperate with the Company to (a) apply for, obtain, perfect, and transfer to the Company the Work Product as well as any and all Intellectual Property Rights in the Work Product in any jurisdiction in the world; and (b) maintain, protect and enforce the same, including, without limitation, giving testimony and executing and delivering to the Company any and all applications, oaths, declarations, affidavits, waivers, assignments, and other documents and instruments as shall be requested by the Company. The Executive hereby irrevocably grants the Company power of attorney to execute and deliver any such documents on the Executive’s behalf in the Executive’s name and to do all other lawfully permitted acts to transfer the Work Product to the Company and further the transfer, prosecution, issuance, and maintenance of all Intellectual Property Rights therein, to the full extent permitted by law, if the Executive does not promptly cooperate with the Company’s request (without limiting the rights the Company shall have in such circumstances by operation of law). The power of attorney is coupled with an interest and shall not be affected by the Executive’s subsequent incapacity.
12.4 No License. The Executive understands that this Agreement does not, and shall not be construed to, grant the Executive any license or right of any nature with respect to any Work Product or Intellectual Property Rights or any Confidential Information, materials, software, or other tools made available to the Executive by the Company.
13. Security.
13.1 Security and Access. The Executive agrees and covenants (a) to comply with all Company Group security policies and procedures as in force from time to time (“Facilities and Information Technology Resources”); (b) not to access or use any Facilities and Information Technology Resources except as authorized by the Company; and (iii) not to access or use any Facilities and Information Technology Resources in any manner after the termination of the Executive’s employment by the Company, whether termination is voluntary or involuntary. The Executive agrees to notify the Company promptly in the event the Executive learns of any violation of the foregoing by others, or of any other misappropriation or unauthorized access, use, reproduction, or reverse engineering of, or tampering with any Facilities and Information Technology Resources or other Company Group property or materials by others.
13.2 Exit Obligations. Upon (a) voluntary or involuntary termination of the Executive’s employment or (b) the Company’s request at any time during the Executive’s employment, the Executive shall (i) provide or return to the Company any and all Company Group property and all Company Group documents and materials belonging to the Company and stored in any fashion, including but not limited to those that constitute or contain any Confidential Information or Work Product, that are in the possession or control of the Executive, whether they were provided to the Executive by the Company Group or any of its business associates or created by the Executive in connection with the Executive’s employment by the Company; and (ii) delete or destroy all copies of any such documents and materials not returned to the Company that remain in the Executive’s possession or control, including those stored on any non- Company Group devices, networks, storage locations, and media in the Executive’s possession or control.
14. Publicity. The Executive hereby consents to any and all uses and displays, by the Company Group and its agents, representatives and licensees, of the Executive’s name, voice, likeness, image, appearance, and biographical information in, on or in connection with any pictures, photographs, audio and video recordings, digital images, websites, television programs and advertising, other advertising and publicity, sales and marketing brochures, at any time during the Employment Term, for all legitimate commercial and business purposes of the Company Group (“Permitted Uses”) without further consent from or royalty, payment, or other compensation to the Executive. Any other use of the Executive’s name, voice, likeness, image, appearance or biographical information outside of legitimate commercial and business purpose of the Company Group or any use of such material not during the Employment Term will require the prior written consent of the Executive. The Executive hereby forever waives and releases the Company Group and its directors, officers, employees, and agents from any and all claims, actions, damages, losses, costs, expenses, and liability of any kind, arising under any legal or equitable theory whatsoever at any time during or after the Employment Term, arising directly or indirectly from the Company Group’s and its agents’, representatives’, and licensees’ exercise of their rights in connection with any Permitted Uses.
15. Governing Law: Jurisdiction and Venue. This Agreement, for all purposes, shall be construed in accordance with the laws of Texas without regard to conflicts of law principles. Any action or proceeding by either of the parties to enforce this Agreement shall be brought only in a state or federal court located in the state of Texas. The parties hereby irrevocably submit to the jurisdiction of such courts and waive the defense of inconvenient forum to the maintenance of any such action or proceeding in such venue.
16. Entire Agreement. Unless specifically provided herein, this Agreement contains all of the understandings and representations between the Executive and the Company pertaining to the subject matter hereof and supersedes all prior and contemporaneous understandings, agreements, representations, and warranties, both written and oral, with respect to such subject matter. The parties mutually agree that the Agreement can be specifically enforced in court and can be cited as evidence in legal proceedings alleging breach of the Agreement.
17. Modification and Waiver. No provision of this Agreement may be amended or modified unless such amendment or modification is agreed to in writing and signed by the Executive and by Chairman of the Board of Directors of the Company. No waiver by either of the parties of any breach by the other party hereto of any condition or provision of this Agreement to be performed by the other party hereto shall be deemed a waiver of any similar or dissimilar provision or condition at the same or any prior or subsequent time, nor shall the failure of or delay by either of the parties in exercising any right, power, or privilege hereunder operate as a waiver thereof to preclude any other or further exercise thereof or the exercise of any other such right, power, or privilege.
18. Severability. Should any provision of this Agreement be held by a court of competent jurisdiction to be enforceable only if modified, or if any portion of this Agreement shall be held as unenforceable and thus stricken, such holding shall not affect the validity of the remainder of this Agreement, the balance of which shall continue to be binding upon the parties with any such modification to become a part hereof and treated as though originally set forth in this Agreement. The parties further agree that any such court is expressly authorized to modify any such unenforceable provision of this Agreement in lieu of severing such unenforceable provision from this Agreement in its entirety, whether by rewriting the offending provision, deleting any or all of the offending provision, adding additional language to this Agreement, or by making such other modifications as it deems warranted to carry out the intent and agreement of the parties as embodied herein to the maximum extent permitted by law. The parties expressly agree that this Agreement as so modified by the court shall be binding upon and enforceable against each of them. In any event, should one or more of the provisions of this Agreement be held to be invalid, illegal, or unenforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other provisions hereof, and if such provision or provisions are not modified as provided above, this Agreement shall be construed as if such invalid, illegal, or unenforceable provisions had not been set forth herein.
19. Captions. Captions and headings of the sections and paragraphs of this Agreement are intended solely for convenience and no provision of this Agreement is to be construed by reference to the caption or heading of any section or paragraph.
20. Counterparts. This Agreement may be executed in separate counterparts, each of which shall be deemed an original, but all of which taken together shall constitute one and the same instrument.
21. Tolling. Should the Executive violate any of the terms of the restrictive covenant obligations articulated herein, the obligation at issue will run from the first date on which the Executive ceases to be in violation of such obligation.
22. Section 409A.
22.1 General Compliance. This Agreement is intended to comply with Section 409A or an exemption thereunder and shall be construed and administered in accordance with Section 409A. Notwithstanding any other provision of this Agreement, payments provided under this Agreement may only be made upon an event and in a manner that complies with Section 409A or an applicable exemption. Any payments under this Agreement that may be excluded from Section 409A either as separation pay due to an involuntary separation from service or as a short-term deferral shall be excluded from Section 409A to the maximum extent possible. For purposes of Section 409A, each installment payment provided under this Agreement shall be treated as a separate payment. Any payments to be made under this Agreement upon a termination of employment shall only be made upon a “separation from service” under Section 409A. Notwithstanding the foregoing, the Company makes no representations that the payments and benefits provided under this Agreement comply with Section 409A, and in no event shall the Company be liable for all or any portion of any taxes, penalties, interest, or other expenses that may be incurred by the Executive on account of non-compliance with Section 409A.
22.2 Specified Employees. Notwithstanding any other provision of this Agreement, if any payment or benefit provided to the Executive in connection with the Executive’s termination of employment is determined to constitute “nonqualified deferred compensation” within the meaning of Section 409A and the Executive is determined to be a “specified employee” as defined in Section 409A(a)(2)(b)(i), then such payment or benefit shall not be paid until the first payroll date following the six-month anniversary of the Termination Date or, if earlier, on the Executive’s death (the “Specified Employee Payment Date”). The aggregate of any payments that would otherwise have been paid before the Specified Employee Payment Date shall be paid to the Executive in a lump sum on the Specified Employee Payment Date and thereafter, any remaining payments shall be paid without delay in accordance with their original schedule.
22.3 Reimbursements. To the extent required by Section 409A, each reimbursement or in-kind benefit provided under this Agreement shall be provided in accordance with the following:
(a) the amount of expenses eligible for reimbursement, or in-kind benefits provided, during each calendar year cannot affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other calendar year;
(b) any reimbursement of an eligible expense shall be paid to the Executive on or before the last day of the calendar year following the calendar year in which the expense was incurred; and
(c) any right to reimbursements or in-kind benefits under this Agreement shall not be subject to liquidation or exchange for another benefit.
23. Notification to Subsequent Employer. When the Executive’s employment with the Company terminates, the Executive agrees to notify any subsequent employer of the restrictive covenants sections contained in this Agreement. The Executive will also deliver a copy of such notice to the Company before the Executive commences employment with any subsequent employer. In addition, the Executive authorizes the Company to provide a copy of the restrictive covenants sections of this Agreement to third parties, including but not limited to, the Executive’s subsequent, anticipated, or possible future employer.
24. Successors and Assigns. This Agreement is personal to the Executive and shall not be assigned by the Executive. Any purported assignment by the Executive shall be null and void from the initial date of the purported assignment. The Company may assign this Agreement to any successor or assign (whether direct or indirect, by purchase, merger, consolidation, or otherwise) to all or substantially all of the business or assets of the Company. This Agreement shall inure to the benefit of the Company and permitted successors and assigns.
25. Notice. Notices and all other communications provided for in this Agreement shall be in writing and shall be delivered personally or sent by registered or certified mail, return receipt requested, or by overnight carrier to the parties at the addresses set forth below (or such other addresses as specified by the parties by like notice):
If to the Company:
TSS, Inc.
110 E. Old Settlers Blvd
Round Rock, TX 78664
Chairman, Board of Directors
If to the Executive:
4400 Via Esperanza
Santa Barbara, CA 93110
26. Representations of the Executive. The Executive represents and warrants to the Company that (a) the Executive’s acceptance of employment with the Company and the performance of duties hereunder will not conflict with or result in a violation of, a breach of, or a default under any contract, agreement, or understanding to which the Executive is a party or is otherwise bound, and (b) the Executive’s acceptance of employment with the Company and the performance of duties hereunder will not violate any non-solicitation, non-competition, or other similar covenant or agreement of a prior employer.
27. Withholding. The Company shall have the right to withhold from any amount payable hereunder any Federal, state, and local taxes in order for the Company to satisfy any withholding tax obligation it may have under any applicable law or regulation.
28. Survival. Upon the expiration or other termination of this Agreement, the respective rights and obligations of the parties hereto shall survive such expiration or other termination to the extent necessary to carry out the intentions of the parties under this Agreement.
29. Acknowledgement of Full Understanding. THE EXECUTIVE ACKNOWLEDGES AND AGREES THAT THE EXECUTIVE HAS FULLY READ, UNDERSTANDS AND VOLUNTARILY ENTERS INTO THIS AGREEMENT. THE EXECUTIVE ACKNOWLEDGES AND AGREES THAT THE EXECUTIVE HAS HAD AN OPPORTUNITY TO ASK QUESTIONS AND CONSULT WITH AN ATTORNEY OF THE EXECUTIVE’S CHOICE BEFORE SIGNING THIS AGREEMENT.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.
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TSS, INC.
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By /s/ Peter Woodward Name: Peter Woodward Title: Chairman, Board of Directors |
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EXECUTIVE |
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Signature: /s/ Darryll Dewan______________________ Print Name: Darryll Dewan |
Exhibit 99.4
AWARD AGREEMENT
This Award Agreement (this “Agreement”) is made as of November 14, 2022 (“Grant Date”), between TSS, Inc. (the “Company”) and Darryll Dewan (the “Executive”). The Board of Directors of the Company has authorized the grant to the Executive of an option (the “Option”) to purchase shares of the Company’s common stock (“Common Stock”), subject to the terms and provisions of this Agreement. For the avoidance of doubt, the Option is not being granted under the Company’s 2015 Omnibus Incentive Compensation Plan. The Company and the Executive have entered into that certain Executive Employment Agreement effective as of the date hereof (the “Employment Agreement”). Capitalized terms used in this Agreement and not otherwise defined in this Agreement shall have the meanings set forth in the Employment Agreement.
The Company and the Executive agree as follows:
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The Company grants to the Executive, subject to the terms and conditions of this Agreement, an Option to purchase 1,250,000 shares of Common Stock (“Option Shares”) in installments as set forth in the following sentence at an exercise price per share of $0.62 (the “Exercise Price”), which is equal to the volume weighted average price per share of the Common Stock reported daily on the OTCQB marketplace during the 30 calendar days immediately preceding the Grant Date. The Option shall become exercisable and may be exercised in installments in accordance with the following schedule: (a) with respect to 416,666.66 Option Shares, on November 14, 2023; (b) with respect to 416,666.66 Option Shares, on November 14, 2024; and (c) with respect to 416,666.67 Option Shares, on November 14, 2025. Notwithstanding the foregoing, the Option shall become immediately exercisable upon the occurrence of a Change in Control of the Company. The Option may not be exercised after November 14, 2032. |
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Except as otherwise set forth in this Agreement, the Option shall terminate effective the close of business on the Termination Date, except (a) to the extent previously exercised, (b) as provided in paragraph 4 of this Agreement, and (c) in the case termination of employment by the Company other than for Cause, for a period of 60 days thereafter the Executive shall be entitled to exercise that portion of the Option that was exercisable at the close of business on the Termination Date, provided that in no event may any portion of the Option be exercised after November 14, 2032. |
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The Option is nontransferable otherwise than by will or the laws of descent and distribution, and, during the lifetime of the Executive, the Option may be exercised only by the Executive or, during the period the Executive is under a legal disability, by the Executive’s guardian or legal representative. Except as provided above, the Option may not be assigned, transferred, pledged, hypothecated or disposed of in any way (whether by operation of law or otherwise) and shall not be subject to execution, attachment or similar process. |
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If the Executive dies without the Option having been exercised in full, the executor or administrator of the Executive’s estate or the person who inherits the right to exercise the Option by bequest or inheritance shall have the right within three years of the Executive’s death to purchase the number of Option Shares the Executive was entitled to purchase at the date of death, after which the Option will lapse, provided that in no event may the Option be exercised after November 14, 2032. |
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The Option shall be exercised by the delivery of a written notice of exercise to the Company, setting forth the number of Option Shares with respect to which the Option is to be exercised, accompanied by full payment for the Option Shares. The Exercise Price shall be payable to the Company in full either: (a) in cash or its equivalent, (b) by tendering previously acquired shares of Common Stock having an aggregate Fair Market Value at the time of exercise equal to the total Exercise Price (provided that the shares that are tendered must have been held by the Executive for at least six (6) months prior to their tender to satisfy the Exercise Price), (c) by withholding shares of Common Stock issuable pursuant to the exercise of the Option having an aggregate Fair Market Value at the time of exercise equal to the total Exercise Price, or (d) such other methods as the Company shall authorize. The Company may permit the exercise of the Option upon the receipt from a third party of payment (or a commitment to make payment) in full in cash for the Exercise Price prior to the issuance of the Option Shares in the manner and subject to the procedures as may be established by the Company. As soon as practicable after receipt of a written notification of exercise and full payment, the Company shall deliver to the Executive, in the Executive’s name, certificates in an appropriate amount based upon the number of Option Shares purchased under the Option. For purposes of this Agreement, “Fair Market Value” means the fair market value of a share of Common Stock as determined in good faith by the Company’s Board of Directors. |
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The Option may be exercised non-sequentially in respect of any other option to acquire Common Stock granted to the Executive, whether in the Executive’s possession or hereafter acquired. |
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At the time the e Option is exercised, in whole or in part, or at any time thereafter as requested by the Company, the Executive hereby authorizes withholding from payroll or any other payment of any kind due the Executive and otherwise agrees to make adequate provision for foreign, federal, state and local taxes required by law to be withheld, if any, which arise in connection with the exercise of the Option. The Company may require the Executive to make a cash payment to cover any withholding tax obligation as a condition of issuance of share certificates representing Option Shares. The Company may permit the Executive to satisfy, in whole or in part, any withholding tax obligation that may arise in connection with the exercise of the Option either by electing to have the Company withhold from the shares of Common Stock to be issued upon exercise that number of shares of Common Stock, or by electing to deliver to the Company already-owned shares of Common Stock, in either case having a Fair Market Value equal to the amount necessary to satisfy the statutory minimum withholding amount due. If the Executive elects to satisfy the tax withholding obligation by having the Company withhold shares of Common Stock upon the exercise of the Option, the number of shares of Common Stock to be withheld shall be based on the minimum estimated federal, state and local taxes payable by the Exercise as a result of the exercise of the Option. |
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The Executive acknowledges and agrees that any sales of shares of Common Stock shall be made in accordance with the requirements of the Securities Act of 1933, as amended. The Company intends to file a registration statement with the Securities and Exchange Commission with respect to the Common Stock to be issued hereunder. The Company intends to maintain this registration statement but has no obligation to do so. If the Company fails to file such registration statement or the registration statement ceases to be effective for any reason or there is a restriction under foreign law, the Executive will not be able to transfer or sell any of the shares of Common Stock issued to the Executive under this Agreement unless exemptions from registration or filings under applicable securities laws are available. The Company shall not be obligated to either issue the Common Stock or permit the resale of any shares of Common Stock if such issuance or resale would violate any applicable securities law, rule or regulation. |
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Nothing in this Agreement shall interfere with or limit in any way the right of the Company to terminate the Executive’s employment at any time, nor confer upon the Executive any right to continue in the employ of the Company. |
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No provision of this Agreement may be amended unless such amendment is in writing and signed by the Executive and the Company. |
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All obligations of the Company under this Agreement shall be binding on any successor to the Company, whether the existence of such successor is the result of a direct or indirect purchase, merger, consolidation, or otherwise, of all or substantially all of the business and/or assets of the Company. |
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To the extent not preempted by federal law, this Agreement shall be construed in accordance with and governed by the laws of the State of Delaware, without giving effect to the conflict of laws principles thereof. |
The undersigned parties have executed this Agreement as of the day and year first above written.
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TSS, INC. |
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By: |
/s/ John Penver |
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John Penver Chief Finanical Officer |
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| EXECUTIVE | |||
| /s/ Darryll Dewan | |||
| Darryll Dewan | |||
Exhibit 99.5
Transition Services and
Separation Agreement
This Transition Services and Separation Agreement (this “Agreement”), effective as of November 14, 2022 (the “Effective Date”), is entered into by and between TSS, Inc (formerly known as Fortress International Group, Inc.), a Delaware corporation (“TSS” or “the Company”), and Anthony Angelini (“Executive”) (collectively referred to as the “Parties”).
WHEREAS, Executive is currently employed by the Company as its President and Chief Executive Officer and the parties have agreed for Executive to cease being the President and Chief Executive Officer of the Company as of the Effective Date, to provide certain transition services to the Company during the period from the Effective Date through the Separation Date (as defined below), and to separate his employment with the Company as of the Separation Date;
WHEREAS, the parties entered into that certain Executive Employment Agreement (the “Employment Agreement”) effective January 3, 2012, as amended by that certain Amendment No. 1 to Employment Agreement effective March 14, 2012, and an Award Agreement dated as of August 6, 2020 (the “Award Agreement”).
NOW, THEREFORE in consideration of the promises described below, the Parties agree as follows:
1. Transition Services. Effective as of the Effective Date, Executive shall no longer serve as the President and Chief Executive Officer of the Company. During the period from the Effective Date until the Separation Date (the “Transition Period”), Executive shall serve as a “Special Advisor to the CEO” of the Company, reporting to the Chief Executive Officer of the Company (the “CEO”). In such position, Executive shall have such duties, authority, and responsibilities as shall be determined by the CEO in the sole discretion of the CEO, shall make himself available to respond to and cooperate with requests for information and questions from the Company, and shall conduct himself professionally when dealing with employees, customers and vendors both in person and by email, phone or any other form of electronic communication. During the Transition Period, the Company shall pay Executive an annual base salary of $385,000 in periodic installments in accordance with the Company’s customary payroll practices and applicable wage payment laws, but no less frequently than monthly, and Executive shall continue to receive his benefits.
2. Acceleration of Vesting. The 166,666 shares of Restricted Stock (as defined in the Award Agreement) that become fully vested on August 6, 2023, under the Award Agreement shall become fully vested on the Effective Date.
3. Separation of Employment. During the Transition Period, Executive’s final day of employment shall be December 31, 2022, unless the Company terminates Executive’s employment prior to such date. For purposes of this Agreement, the term “Separation Date” means the earlier of (a) the date either Executive or the Company terminates Executive’s employment, or (b) December 31, 2022. Subject to the terms of this Agreement, Executive acknowledges that, if his employment terminates prior to the December 31, 2022, he is entitled to compensation and benefits through the actual date of termination only.
4. Board of Directors. Upon the Separation Date, Executive shall tender his resignation from the Board of Directors of the Company and from all other positions the Executive then holds with the Company.
5. General Release of Claims. In consideration for the benefits described in this Agreement, Executive forever releases and discharges the Company from any claims, rights, or causes of actions of any kind or nature, both known or unknown, up through and including the date Executive signs this Agreement. Executive provides this General Release not only on behalf of himself but also his heirs, executors, successors and assigns. Executive further agrees that this release and discharge of “the Company” includes not only the Company but also any of their respective current and former parents, subsidiaries, affiliates, joint ventures, predecessor and successor companies, and with respect to each such entity, all of its past, present and future officers, directors, agents and/or employees (all collectively referred to as the “Releasees”). This General Release includes, to the maximum extent permitted by law, claims, rights, and causes of action arising (a) under all federal, state or local law relating to employment and employment discrimination, termination rights, compensation or benefits, such as the Fair Labor Standards Act, the Age Discrimination in Employment Act (“ADEA”), the Older Worker Benefits Protection Act, Title VII of the Civil Rights Act of 1964, the Family and Medical Leave Act (“FMLA”), the Americans with Disabilities Act, the Civil Rights Act of 1866, the National Labor Relations Act, or any claims arising under the law of any state or locality within it, including but not limited to the laws of the State of Texas, and all common law claims in law or equity of any nature that he ever had or has, shall or may have against any of the Releasees that relate to any act, event, or omission, known or unknown, intentional, unintentional, or negligent, suspected or unsuspected, from the beginning of time up to and including the date of this Release, including, but not limited to, all claims known or unknown, asserted or unasserted which relate to any aspect of Executive’s employment by or termination from the Company and promises not to sue on any such claims; and/or (b) upon any other basis for legal, equitable or administrative relief, whether based on express or implied contract, tort, statute, regulation or other legal or equitable ground, and whether employment-related or not, including but not limited to breach of employment contract, fraud, negligence (including negligent hiring and retention), tort, implied contracts or implied covenants of good faith and fair dealing, and any and all other federal, state and local statutes, cases, authorities or laws providing a cause of action. Despite its generality, this General Release does not waive (1) Executive’s right to enforce this Agreement; (2) rights to vested benefits Executive may have under the Company’s benefit plans; (3) the right to file a charge or complaint with the U.S. Equal Employment Opportunity Commission or any state or local government agency and to participate in its investigation and proceedings, except that Executive waives the right to recover any damages as a result of such complaints or filings; (4) any claims or rights that cannot be lawfully waived by Executive; and (5) any claims, rights or causes of action arising after the date Executive signs this Agreement.
6. Severance Pay. Beginning with the first payroll period in calendar year 2023, Executive shall receive severance in the amount of three hundred eighty-five thousand dollars ($385,000), less all applicable deductions, paid through the Company’s normal payroll cycle and over a twelve month period. Further, Executive’s Employer-provided health benefits will terminate as of the Separation Date, subject to Executive’s right to continue his health insurance under COBRA. If Executive elects COBRA, for a period of twelve months from the Separation Date, the Company will pay the percentage of the premium in an amount equal to the percentage of the premium for health insurance paid by the Company prior to the Separation Date. Notwithstanding the foregoing, Executive shall forfeit his right to receive the severance benefits described in this Section 6, and the Company will owe no further payments or other benefits of any kind to Executive, if Executive (a) violates the provisions of this Agreement or the Employment Agreement, or (b) fails to execute the attached General Release Agreement no earlier than his final day of employment and the applicable revocation period expires without valid revocation.
7. Cooperation. Executive agrees to cooperate with the Company in the event of actual or threatened litigation, audits, or investigations by third parties involving facts known to him by virtue of his employment with the Company. The Company shall reimburse Executive for reasonable out-of-pocket expenses associated with such cooperation, including travel, lodging, and meal expenses. Unreasonable refusal on the part of Executive to cooperate with the Company’s requests for cooperation will constitute grounds for the Company to discontinue any outstanding severance payments immediately and the Company will owe no further payments or other benefits of any kind to Executive. The Company agrees to notify the Executive of any such unreasonable refusal and both parties will enter into a good faith discussion with the Executive for 7 business days to resolve any disagreement before taking any action.
8. Unemployment. The Company shall not contest Executive’s entitlement to unemployment benefits. Nothing in this or any other section of this Agreement shall prohibit the Company from responding truthfully to government inquiries.
9. Other Payments. Executive acknowledges that the payments set out in the Agreement will fully compensate him for all wages, bonuses, commissions, expenses, paid time off and any other benefit to which he was owed as a result of his employment with the Company. Executive acknowledges and agrees that the Company has complied with all of its obligations pursuant to the Agreement to date. Executive further acknowledges that he has been paid all salary and compensation due to him under the Fair Labor Standards Act and the wage and hour laws and wage payment and collection laws of Texas. Notwithstanding the foregoing, Executive shall participate in the 2022 Company Incentive Plan approved by the Compensation Committee of the Company’s Board of Directors on May 31, 2022, as if Executive had remained employed as CEO of the Company through the date any bonus payments are made under such plan.
10. Confidentiality. Executive agrees that he will keep all terms and conditions of this Agreement, all confidential business information of the Company and its parents, subsidiaries, affiliates, and their respective successors and assigns and their respective customers, and the circumstances surrounding the termination of Executive’s employment confidential, and that he will not disclose or cause to be disclosed any such terms or conditions, directly or indirectly, to any person or entity other than his spouse, domestic partner, legal counsel, auditor or accountant, except to the extent required by law or as required to enforce the terms of this Agreement. Executive acknowledges and agrees that any material violation of this Section 10 will constitute a breach of this Agreement. The Company agrees that it will instruct any employees of the Company who know the terms of this Agreement that they are to keep them confidential.
11. Non-Admission. Nothing in this Agreement shall be considered as or asserted to be an admission of any breach, wrongdoing, negligence, or discrimination on the part of either party.
12. Entire Agreement. This Agreement contains the entire understanding of the Company and Executive concerning the Executive’s separation and supersedes and cancels all previous agreements, commitments, and writings between Executive and the Company except as otherwise specified herein. Notwithstanding the foregoing, the following provisions in the Employment Agreement will survive and remain in full force and effect during the Transition Period and following the Separation Date: Section 7 (Non-Solicitation of Customers or Employees; Non-Competition); Section 9 (Arbitration), Section 10 (General Provisions) and Exhibit B (Invention Assignment And Confidentiality Agreement). The Parties further agree that there are no written or oral terms or representations made by either party other than those contained herein. This Agreement shall not be changed except by another written agreement signed by the Parties.
13. Severability. Each provision of this Agreement shall be considered severable. If any provision contained herein is held to be void, illegal, or unenforceable, such illegality or unenforceability shall not affect any of the other provisions herein, and the remaining provisions of this Agreement will continue to be given full force and effect.
14. Governing Law, Jurisdiction, and Venue. Any dispute arising from or related to this Agreement or the interpretation or operation of this Agreement shall be resolved solely in state or federal courts located in the State of Maryland. The Parties hereby consent to, elect, and waive any objection to the laying of jurisdiction and venue in such courts in the event of litigation under or relating to this Agreement. This Agreement shall be interpreted under the laws of the State of Texas or any applicable federal law.
15. Voluntary Agreement; Joint Drafting. By voluntarily executing this Agreement, each of the Parties confirms that they have been given sufficient time to review and consider this Agreement and that each is relying upon its own judgment and the advice of its legal counsel, and not on any recommendations or representations of the other party or any of its agents or representatives. By voluntarily executing this Agreement, each of the Parties confirms that it understands and accepts all terms and conditions of this Agreement as resolving fully all claims it has, had or may have against the other party. The Parties agree that this Agreement shall be treated as having been jointly drafted by the Parties.
16. Successors and Assigns. This Agreement shall be binding on and enforceable by the successors and assigns of the Parties.
17. Return of Company Property. Executive certifies and warrants that he will return all Company property in his possession to the Company within five (5) days after a request from the Company. This acknowledgement includes, but is not limited to, the following property: all computer equipment, software, computer files, flash drives or other portable storage devices, hard drives, discs, and all hard and electronic copies of documents, studies, reports, audits or files, including electronic copies, containing business information or analysis thereof received from the Company or any of its employees, vendors, customers or prospective customers or generated by Executive or his subordinates or colleagues during his employment with the Company, as well as keys, pass cards, credit cards, and electronic devices. Executive agrees that this provision covers any copies of documents saved on personal computer devices or the cloud. The Executive will notify the Company of any such downloads made before the Separation Date and cooperate with the Company in seeing that they are deleted or transferred back to the Company.
18. Waiver of Jury Trial. EACH OF THE PARTIES HEREBY WAIVES TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO WHICH EXECUTIVE AND THE COMPANY MAY BE PARTIES, ARISING OUT OF OR IN ANY WAY PERTAINING TO THIS AGREEMENT. IT IS AGREED AND UNDERSTOOD THAT THIS WAIVER CONSTITUTES A WAIVER OF TRIAL BY JURY OF ALL CLAIMS AGAINST ALL PARTIES TO SUCH ACTIONS OR PROCEEDINGS, INCLUDING CLAIMS AGAINST PARTIES WHO ARE NOT PARTIES HERETO. THIS WAIVER IS KNOWINGLY, WILLINGLY, AND VOLUNTARILY MADE BY EACH OF THE PARTIES.
19. No Pending Claims. Executive represents that he has not filed, directly or indirectly, or caused to be filed, any other claims against the Company or the Releasees released through the execution of this Agreement in any forum, including federal, state, or local court, in any arbitration, or any administrative proceeding with any federal, state, or any government agency. Executive acknowledges and agrees that should any government agency or third party pursue any claims on his behalf, he waives his right to any monetary or other recovery of any kind and/or acknowledges that the consideration paid to him by way of the Payment as described in this Agreement satisfies any such monetary or other recovery to the extent permitted by law.
20. Counterparts. The parties agree that this document can be signed in counterparts and that a facsimile or portable document file (.pdf) of a version of this Agreement shall be given the same force and effect as an original signature.
IN WITNESS THEREOF, THE UNDERSIGNED PARTIES AFFIX THEIR SIGNATURES TO THIS AGREEMENT. THIS IS A GENERAL RELEASE AND WAIVER OF CLAIMS. YOU ARE ADVISED TO READ AND CONSULT WITH LEGAL COUNSEL PRIOR TO SIGNING.
[Signatures on Following Page]
| TSS, Inc. | ||
| /s/ Anthony Angelini | By: | /s/ Peter Woodward |
| Anthony Angelini | Peter Woodward, Chairman | |
| November 14, 2022 | November 14, 2022 | |
| Date | Date |
GENERAL RELEASE OF CLAIMS AND PROMISE NOT TO SUE
This General Release of Claims and Promise Not to Sue (“General Release”) is entered into by and between TSS, Inc (formerly known as Fortress International Group, Inc.,)(“TSS” or “the Company”) and Anthony Angelini (“Executive”) (collectively referred to as the “Parties”).
NOW, THEREFORE in consideration of the promises set forth in the Transition Services and Separation Agreement entered between the Parties on November 14, 2022, and incorporated by reference into this General Release, the Parties agree as follows:
1. General Release of Claims and Promise Not to Sue. In consideration for the benefits described in the Separation Agreement, Executive forever releases and discharges the Company from any claims, rights, or causes of actions of any kind or nature, both known or unknown, up through and including the date Executive signs this Agreement. Executive provides this General Release not only on behalf of himself but also his heirs, executors, successors and assigns. Executive further agrees that this release and discharge of “the Company” includes not only the Company but also any of their respective current and former parents, subsidiaries, affiliates, joint ventures, predecessor and successor companies, and with respect to each such entity, all of its past, present and future officers, directors, agents and/or employees (all collectively referred to as the “Releasees”). This General Release includes, to the maximum extent permitted by law, claims, rights, and causes of action arising (a) under all federal, state or local law relating to employment and employment discrimination, termination rights, compensation or benefits, such as the Fair Labor Standards Act, the Age Discrimination in Employment Act (“ADEA”), the Older Worker Benefits Protection Act, Title VII of the Civil Rights Act of 1964, the Family and Medical Leave Act (“FMLA”), the Americans with Disabilities Act, the Civil Rights Act of 1866, the National Labor Relations Act, or any claims arising under the law of any state or locality within it, including but not limited to the laws of the State of Texas, and all common law claims in law or equity of any nature that he ever had or has, shall or may have against any of the Releasees that relate to any act, event, or omission, known or unknown, intentional, unintentional, or negligent, suspected or unsuspected, from the beginning of time up to and including the date of this Release, including, but not limited to, all claims known or unknown, asserted or unasserted which relate to any aspect of Executive’s employment by or termination from the Company and promises not to sue on any such claims; and/or (b) upon any other basis for legal, equitable or administrative relief, whether based on express or implied contract, tort, statute, regulation or other legal or equitable ground, and whether employment-related or not, including but not limited to breach of employment contract, fraud, negligence (including negligent hiring and retention), tort, implied contracts or implied covenants of good faith and fair dealing, and any and all other federal, state and local statutes, cases, authorities or laws providing a cause of action. Despite its generality, this General Release does not waive (1) Executive’s right to enforce this Agreement; (2) rights to vested benefits Executive may have under the Company’s benefit plans; (3) the right to file a charge or complaint with the U.S. Equal Employment Opportunity Commission or any state or local government agency and to participate in its investigation and proceedings, except that Executive waives the right to recover any damages as a result of such complaints or filings; (4) any claims or rights that cannot be lawfully waived by Executive; and (5) any claims, rights or causes of action arising after the date Executive signs this Agreement.
2. Notice. Pursuant to the Age Discrimination in Employment Act and the Older Workers Benefit Protection Act (“OWBPA”):
(a) Acknowledgments. Executive acknowledges and agrees that the Company has offered him a period of at least twenty-one (21) days within which to consider this Agreement prior to signing it. Executive states that he has considered and made his own decision regarding whether to sign the Agreement prior to the expiration of the twenty-one day period.
(b) Revocation & Effective Date. Executive has the right to revoke this Agreement by providing written notice of revocation to Christopher Johnson, Esquire, Miles & Stockbridge, 100 Light Street, Baltimore, Maryland 21202, before the expiration of seven (7) calendar days following the date Executive signs this Agreement (the “Revocation Period”). If Executive has not delivered the written notice of revocation before the expiration of the Revocation Period, this General Release shall take effect on the day following the expiration of the Revocation Period.
3. Counterparts. The parties agree that this document can be signed in counterparts and that a facsimile or portable document file (.pdf) of a version of this Agreement shall be given the same force and effect as an original signature.
IN WITNESS THEREOF, THE UNDERSIGNED PARTIES AFFIX THEIR SIGNATURES TO THIS AGREEMENT. THIS IS A GENERAL RELEASE AND WAIVER OF CLAIMS. YOU ARE ADVISED TO READ AND CONSULT WITH LEGAL COUNSEL PRIOR TO SIGNING.
| FOR TSS, Inc. | ||
| By: | ||
| anthony angelini | Peter Woodward, Chairman | |
| Date | Date |