Free Statement - District Court of Arizona - Arizona


File Size: 170.9 kB
Pages: 4
Date: December 31, 1969
File Format: PDF
State: Arizona
Category: District Court of Arizona
Author: unknown
Word Count: 1,319 Words, 8,315 Characters
Page Size: 612 x 790.8 pts
URL

https://www.findforms.com/pdf_files/azd/24156/384-35.pdf

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Preview Statement - District Court of Arizona
Snell & Wilmer
» -—-~ ¤.1.r>.—-—-—
OFFICE MEMORANDUM
TO: Janet Lord V
FROM: Michael Donahey
DATE: February 23, 2000
RE: Mark Cardwell
Separation Agreement
· The following are our comments regarding the draft Cardwell Separation Agreement. In
the interest of time, I am forwarding these comments to you before my client has had an
opportunity to review them. Accordingly, the Company may have additional comments.
1. The Recitals should reference and reaffirm the binding effect ofthe Release
‘ signed by Cardwell on 12/13/99. Similarly, paragraph 15 encaptioned, "Entire Agreement" `
should be modified to reflect the existence and binding effect ofthe earlier Release Agreement
between the parties.
2. In Recital 2 change the word “is" to "was".
3. In Recital 3 change the word "founder’s" to the word "common”. `
4. Recital 4 should be revised in its entirety to read as follows:
"Cardwell was a member of the Board of Directors of the
Company until the expiration of his temt on February 21, 2000.”
5. In Section lA of the Agreement delete the words "either purchase or".
6. Delete all of Section 1B ofthe Agreement except the first sentence.
7. Delete all of Section 1C ofthe Agreement. U
8. Revise the first clause of Section 2A ofthe Agreement to read as follows:
"In consideration of Cardwell’s Agreements hereunder upon the
expiration of the seven-day period described in Section 10, the
Company will pay. . ."
As we discussed, it would be preferable to have a simultaneous
signing and closing which would eliminate-the need for an advance.
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If the advance remains, the amount paid as an advance should
reduce the amount payable to Cardwell upon closing.
9. Revise Section 2B of the Agreement to reads as follows:
"Upon execution of this Agreement and receipt of an affidavit of
lost certificate properly executed by Cardwell, the Company
will. . ."
10. The last sentence of Section 3 of the Agreement should be revised in its entirety
to read as follows:
"Cardwell agrees that immediately upon receipt of the Advance
Payment in full, he will exercise the option granted in this Section _
3."
ll. Delete Section 5 ofthe Agreement.
12. In Section 7 ofthe Agreement replace the date February 1, 2000 with the date of
this Agreement.
13. In Section 8 ofthe Agreement replace the date February 1, 2000 with the date of
this Agreement and increase the term ofthe non—solicitation to one year.
14. Please make the following revision at the top of page 4:
". . . of every kind or nature, as a result of or arising out pf apy
event or alleged event occurring or alleged to have occurred prior
to the execution of this Agpegment including, wiglgpgt limitgtign,
[from] Cardwell’s employment . . . (insertion underlined).”
_ 15. In that same paragraph, after the word shareholder in the second to the last line,
- add the words "or board member".
16. Add the following to the state and federal statutes listed in paragraph 9(a):
"Medical Leave Act of 1993, ths Americans With Disabilitigs Act
of 1990, the Employee Retirgmsnt Ingoms Sgrity Apt gf 1974,
the Aggpna Emplpyment Prgg@on Ag, and the Arizona
Constructive Dischgge Act and any glaim fgr g;tprnsys’ fggs.
(insertion underlined).”
17. Add language such as the following to the end of the Release paragraph (9(a)):
"Upon being provided the benefits contained in paragraphs 1, 2
and 3 above, the Company is not further indebted to Mr. Cardwell
in any amount for any reason whatsoever. "
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18. In the Covenant Not to Compete paragraph (`No. 7), the "business activities of the
Company” should be described in as much detail as possible to avoid later potential disputes
over what activity is prohibited. I will forward such language to you shortly.
19. Some form of forfeiture, or liquidated damages, provision in the event that
Cardwell takes some action he has agreed not to (for example, suing the Company). Following
is an example:
"In the event that Mr. Cardwell commences or voluntarily
participates in any lawsuit or proceeding against the Company, or
claims that this Agreement is in any respect invalid or
unenforceable, Mr. Cardwell agrees that a mandatory condition
precedent to any such action is the full retum to the Company of
all benefits (or their monetary equivalent) derived under this
Agreement. The foregoing condition precedent shall not affect the
ongoing enforceability of Mr. Cardwell’s full Release contained in
paragraph 9(a) above."
20. Please revise the first sentence of Section 13 ofthe Agreement to read as follows:
"The Company agrees that Cardwell may keep and own as his _
property the following Company property:
A. Desktop computer (and accessories);
B. The laptop computer (and accessories);
C. The Nino PDA and the cellular telephone (but not cellular
service)."
21. In Section 14, we must make it clear that the transferees provided for in this
paragraph cannot resell the shares at all until the expiration of this Section.
22. The first clause in Section 19 should be revised as follows:
"The Parties agree that unless otherwise required by law, they will
not. . ."
23. The signature page should have an "Approved As To Form" signature line for
counsel for all parties to sign in order to eliminate any later questions about whether the terms of
the Agreement were reviewed by counsel.
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Rider 4A
SECTION 2.06. Closing Deliveries by Seller. At the Closing, Seller shall deliver or
cause to be delivered to Purchaser certificates representing the Shares, duly endorsed (or
accompanied by duly executed stock powers), for transfer.
Rider 4B
capital stock consists of l00,000,000 shares of common stock, without par value, and 20,000,000
shares of preferred stock, of which 2,600,000 shares have been designated Series A Preferred
Stock, without par value, 2,200,000 shares have been designed Series B Preferred Stock, without
par value, 4,400,000 shares have been designated Series C Preferred Stock, without par value,
266,667 shares have been designated Series D Preferred Stock, without par value, and 1,875,000
shares have been designated Series E Preferred Stock, without par value. The Company has
issued and outstanding 7,076,300 shares of Common Stock (not including shares of Common
Stock reserved for issuance to Series C finders), 2,400,000 shares of Series A Preferred Stock,
2,050,000 shares of Series B Preferred Stock, 4,289,624 shares of Series C Preferred Stock,
- 266,667 shares of Series D Preferred Stock and 1,875,000 shares of Series E Preferred Stock.
Rider 8
_ ARTICLE V
REPRESENTATIONS AND W S OF SELLER
As an inducement to Company and Purchaser to enter into this Stock Purchase
Agreement, Seller represents and warrants to Company and Purchaser as follows:
SECTION 5.01. Executign gd Enfgrggabiligg. This Stock Purchase Agreement (i)
has been, and upon their execution the other documents hereunder will be, duly executed and
delivered by Seller, and (ii) constitutes, and upon their execution the other documents hereunder
will constitute, legal, valid and binding obligations of Seller enforceable against Seller in
accordance with their respective terms.
SECTION 5.02. Ownership of Shares. Seller has good, absolute, and marketable
title to the Shares, ’ri·ee and clear of all liens, claims, encumbrances, and restrictions of any kind.
Seller has the complete and unrestricted right, power, and authority to sell, transfer, and assign
the Shares to the Purchaser pursuant to this Stock Purchase Agreement.
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