Exhibit 10.2

 

Date this agreement provided to Charles Nichols: November 30, 2012

 

AGREEMENT OF SEPARATION, WAIVER, AND MUTUAL RELEASE

 

WHEREAS, Charles Nichols (hereinafter the “Employee”) has been employed by Scio
Diamond Technology Corporation (hereinafter the “Company”) as Chief Financial
Officer, pursuant to that Amended and Restated Offer of Employment Effective as
of November 30, 2011 (the “Employment Agreement”); and

 

WHEREAS, Employee and the Company are also parties to the following agreements:
the Change in Control Agreement dated August 3, 2012 (the “Change in Control
Agreement”); the two Qualified Stock Option Grant Agreements dated May 7, 2012,
as amended on November 6, 2012 (the “May 7 Option Grants); and the Qualified
Stock Option Grant Agreement dated August 3, 2012, as amended on November 6,
2012 (the “August 3 Option Grant”); and

 

WHEREAS, the parties hereto now wish to terminate that employment relationship
and to resolve any and all claims and disputes that might exist between them.

 

NOW THEREFORE, FOR AND IN CONSIDERATION of the mutual promises contained in this
Agreement of Separation, Waiver, and Release (this “Agreement”), the receipt and
sufficiency of which are hereby acknowledged, Employee and the Company agree as
follows:

 

1.              Employee’s employment with the Company is terminated effective
at the close of business on November 30, 2012.  The Company’s obligation to pay
salary, bonus or provide other benefits terminates on that date, except as
provided herein.

 

2.              In consideration for this Agreement and the release contained
herein, the Company will pay to Employee an amount equal to two months of his
current annual salary ($20,833.33), plus up to seven days of any accrued, unused
vacation.  This amount will be paid to Employee in a lump sum, subject to normal
and required withholdings, and in accordance with the Company’s normal payroll
practices. The Company will also pay an amount equal to two months of health
insurance premiums that would become due as the result of Employee’s election to
continue his health insurance coverage under S.C. Code Ann. §§38-71-360 and
38-71-770. These payments will be made after the expiration of the revocation
period provided for in paragraph 23(g) below.

 

3.              Employee currently holds 0 shares of Common Stock of the
Company, $0.001 par value (“Common Stock”).

 

4.              Pursuant to the May 7 Option Grants, Employee was granted
options for the purchase of up to 425,000 shares of Common Stock at an exercise
price of $0.70 cents per share.  The options to purchase 325,000 shares of
Common Stock pursuant to the May 7 Option Grants shall be immediately canceled
and may not now or hereafter be exercised.  Thus, Employee will continue to hold
options to purchase 100,000 shares of Common Stock pursuant to the May 7 Option
Grants, which options shall, except to the extent expressly provided in this
Agreement, in all respects be governed by the May 7 Option Grants and the
Company’s 2012 Share Incentive Plan.  Notwithstanding the provisions of the
May 7 Option Grants, as amended, Employee shall have the right to exercise such
options to purchase 100,000 shares of Common Stock pursuant to the May 7 Option
Grants for a period of six (6) months from November 30, 2012 (subject to any
restrictions

 

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in the Company’s 2012 Share Incentive Plan).

 

5.              Pursuant to the August 3 Option Grant, Employee was granted
options for the purchase of up to 300,000 shares of Common Stock at an exercise
price of $0.80 cents per share. The options to purchase 300,000 shares of Common
Stock pursuant to the August 3 Option Grant shall be immediately canceled and
may not now or hereafter be exercised.

 

6.              Employee recognizes and agrees that Employee is solely
responsible for any federal, state, or other tax obligations, including but not
limited to all reporting and payment obligations that could arise as a
consequence of Employee’s receipt of any payments or benefits pursuant to this
Agreement, and with respect to any other transfer or transaction provided for
herein, including but not limited to any transfers of shares of Common Stock and
the cancellation or exercise of options to purchase Common Stock.

 

7.              Employee hereby releases and waives all claims Employee, other
than Indemnification Rights (as defined below), may have against the Company and
the parties identified in this paragraph as Company Released Parties who are
connected with the Company.

 

This means that, in consideration of the promises made by the Company herein,
Employee, for Employee and for Employee’s heirs, executors, administrators,
personal representatives, successors, and assigns, does hereby release, waive,
and forever discharge the Company and its related entities, their respective
benefit plans, officers, directors, employees, representatives, agents,
successors and assigns, and the respective heirs, executors, administrators,
personal representatives, successors and assigns of the foregoing (collectively,
the “Company Released Parties”), from any claim Employee may have against them,
except as specifically provided herein.  This release, and the term “claim” or
“claims” as used in this Agreement, includes all benefits, grievances,
proceedings, investigations, hearings, charges, complaints, claims, demands,
actions, causes of action, and suits of whatever nature, whether known or
unknown, fixed, absolute or contingent, matured or unmatured, asserted or
unasserted, however arising, and whether legal, equitable, or administrative. 
Employee understands and agrees that in exchange for the benefits provided
herein, Employee is giving up all such claims against the Company Released
Parties.

 

This release also includes, but is not limited to, claims arising under federal,
state, or local statute, ordinance, common law, regulation, equity or other
sources including, but not limited to, any and all claims of disability, race,
color, sex, age, national origin, ancestry, religion, or other discrimination,
retaliation, or harassment, and claims arising under Title VII of the Civil
Rights Act of 1964, 42 U.S.C. §§ 2000e, et seq.; the Civil Rights Act of 1866,
1871, and 1964, as amended; the Employee Retirement Income Security Act (ERISA),
29 U.S.C. §§ 1001 et seq.; Section 1981 of Title 42 of the U.S. Code; the
Americans with Disabilities Act, §§ 29 U.S.C. 12101 et seq.; the Family and
Medical Leave Act, 29 U.S.C. §§ 2601, et seq.; the Age Discrimination in
Employment Act; claims arising under the statutory or common laws of the State
of South Carolina or any other state, and claims asserting breach of contract
(whether express or implied), promissory estoppel, wrongful termination,
defamation, failure to pay wages or commissions, failure to provide benefits,
breach of implied covenant of good faith and fair dealing, promissory estoppel,
invasion of privacy, injury to credit, outrage, negligent or intentional
infliction of emotional distress, retaliation, interference with contract,
fraud, distress, extortion, humiliation, loss of standing and prestige, personal
injury, loss of consortium, negligence, tort, or other common law causes of
action, including, but not limited to, those related in any way to Employee’s
employment by the Company, the terms of the Employment Agreement, the May 7
Option Grants, the August 3 Option

 

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Grant and the Change in Control Agreement, benefits or wages provided in
connection with that employment, severance or other post-termination pay or
benefits, and/or the termination of that employment.  Employee does not waive
any rights or claims that arise from events occurring after execution of this
Agreement by Employee.  The released claims include, but are not limited to, any
claims for back pay, front pay, benefits of any sort, severance pay, damages,
court costs, attorneys’ fees, special damages, punitive damages, treble or other
multiple damages, statutory or other penalties, reinstatement or any other
monetary or equitable relief.  Employee acknowledges that if Employee sues the
Company or any other Released Party in violation of this Agreement, Employee may
be directed to pay some or all costs and expenses incurred by the Company or the
Released Party in defending the suit, including reasonable attorneys’ fees, to
the extent provided by law and determined by the court.

 

Notwithstanding the foregoing, this release does not include, and Employee
specifically reserves, Employee’s rights, in each case only to the extent such
rights exist, to indemnification and advancement of expenses by and from Company
under 1) the Company’s by-laws; 2) Nev. Rev. Stat. Ann. §§ 78.7502, 78.751, and
78.752; and 3) the Company’s applicable liability insurance policy(ies)
providing coverage for directors and officers (the “Indemnification Rights”).

 

8.              Company and the Company Released Parties intending to be legally
bound, for and in consideration of the obligations to be performed under this
Agreement, knowingly and voluntarily waive and release all known and unknown
rights and claims which they may have against Employee, including any and all
charges, complaints, accusations, claims, liabilities, obligations, promises,
agreements, contracts, controversies, damages, actions, causes of action, suits,
rights, demands, costs, losses, debts and expenses of any kind arising or that
may have arisen out of or in connection with Employee’s employment with Company
from the beginning of time through the effective date of this Agreement.

 

9.              Employee agrees not to claim, receive, or accept any monies,
damages, or relief in conflict with this Agreement and Employee’s waiver of
rights, and not to pursue any of the claims released in this Agreement. 
Employee shall waive any right to, and will not accept, any remedy obtained
through the efforts of any other individual or agency, state or federal,
relating to Employee’s employment with the Company.  This Agreement does not
affect Employee’s ability or responsibility to participate in or cooperate with
any future legal or other investigation, whether conducted by the Company or any
governmental agency.

 

10.       Employee represents and warrants that Employee has not made a claim
for worker’s compensation related to Employee’s employment with the Company, and
that Employee is currently unaware of any injury or illness that would support
such a claim.

 

11.       Employee agrees to return to the Company all property of the Company,
including but not limited to company data and information, records, files and
lists (in each case, whether hard copy or electronic), including but not limited
to confidential information and trade secrets, including all copies of any
Company information.  Employee agrees not to access and not to attempt to gain
access to any aspect of the Company’s computer, electronic or IT systems.

 

12.       Employee represents and warrants that Employee has not assigned,
transferred, or conveyed to any individual or entity not a party to this
Agreement any alleged right, claim or cause of action of any kind which is
included within the above releases.  Employee further represents and warrants
that Employee is executing this Agreement knowingly and voluntarily, without any
duress, coercion or undue influence by the Company, its representatives or any
other person.

 

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13.       Employee acknowledges and agrees that neither the Company nor any of
the Company Released Parties owes Employee any wages, salary, bonus, cost
reimbursement, vacation pay, commissions, or other compensation in any amount
whatsoever other than as expressly agreed to herein.  The consideration being
paid for this Agreement encompasses any such amounts Employee might claim.  The
Company’s only obligation is to pay the amount provided herein, and Employee’s
salary through the date of termination provided above.  Employee further
acknowledges that neither the Company nor any of the Company Released Parties
compelled Employee to execute this Agreement as a condition to the payment of
any amounts previously and admittedly due to Employee.

 

14.       The parties hereto recognize and agree that the Change in Control
Agreement is terminated as of the date hereof and shall be of no further force
and effect.  Without loss of generality of the foregoing, no payment is or will
become due to Employee under the Change in Control Agreement, and the
Restrictive Covenants contained in paragraph 4 of the Change in Control
Agreement shall not apply to Employee.

 

15.       Except as set forth in paragraph 4 above, Employee shall have no
further right under any agreement or plan to receive any grant of shares of
Common Stock or options or other rights to purchase shares of Common Stock.

 

16.       The parties hereto confirm and agree that the following agreements
between them continue to govern their relationships to the extent applicable:

 

a.              Paragraphs 8 and 9 of the Employment Agreement, headed
respectively “Confidentiality, Non-Competition and Invention Assignment
Agreement” and “Prior Apollo Patents,”  as well as the Proprietary Information
and Inventions Agreement that is incorporated into the Employment Agreement by
paragraph 8 of the Employment Agreement and attached to the Employment
Agreement, to the extent that the Proprietary Information and Inventions
Agreement provides (in its paragraph 8) that it survives termination.

 

b.              To the extent provided in paragraph 4 above, the May 7 Option
Grants and the Company’s 2012 Share Incentive Plan.

 

17.       [Intentionally Deleted.]

 

18.       a. Employee agrees not to make any statements, written or verbal, or
cause or encourage others to make any statements, written or verbal, including
but not limited to any statements made via social media, on websites or blogs,
that defame, disparage or in any way criticize the personal or business
reputation, practices, or conduct of the Company, or any of the Company Released
Parties. Employee acknowledges and agrees that this prohibition extends to
statements, written or verbal, made to anyone, including but not limited to the
news media, competitors, vendors, employees (past and present), volunteers and
clients.  Employee further understands and agrees that this paragraph is a
material provision of this Agreement and that any breach of this paragraph shall
be a material breach of this Agreement, and that the Company would be
irreparably harmed by violation of this provision.  Notwithstanding the
foregoing, nothing in this Agreement is intended to or shall prevent, impede, or
interfere with Employee providing truthful testimony and information required
and requested in the course of an investigation or proceeding authorized by law
and conducted by an agency of the United States or of the several states.

 

b. The Company also agrees to direct its officers and directors not to make any
defamatory or disparaging statements, written or verbal, concerning Employee to
future employers of the

 

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Employee and agrees that its officers and directors will not send, or direct any
other third party to send, false or slanderous information about Employee. 
Nothing herein prevents disclosure, in the sole discretion of the Company and
its management, of this Agreement and discussion of Employee’s employment with
and separation of employment from the Company and the circumstances regarding
his separation from the Company (i) by and among employees, representatives and
agents of the Company and the Company Released Parties, (ii) as required by
securities or other applicable laws, or (iii) to or in response to any
governmental entity or other legal request.

 

19.       Employee agrees that Employee will not seek reinstatement,
reemployment or a contract with the Company after the execution of this
Agreement. Company will provide to Employee a letter of reference in the form
attached hereto as Exhibit 1.

 

20.       This Agreement is entered solely to effect an amicable separation and
avoid the expense of any future dispute, and nothing contained herein is to be
construed as an admission by the Company (or any Released Party) of any
wrongdoing.

 

21.       Except for the Employment Agreement, the Proprietary Information and
Inventions Agreement and the May 7 Option Grants, there are no other agreements
between the parties hereto related to the subject matter of this Agreement that
is not set forth herein.  Together these agreements constitute the entire
agreement of the parties hereto with respect to their subject matters.  Neither
this Agreement nor any provision herein shall be amended, modified, waived or
discharged orally or by course of conduct, but only by a written agreement
executed and delivered by the parties hereto.

 

22.       Company represents and warrants that this Agreement, and the terms of
the May 7 Option Grants, has been duly authorized by Company’s board of
directors and that the undersigned on behalf of Company is authorized to execute
this Agreement.

 

23.       To comply with the Older Workers Benefits Protection Act of 1990, the
Company has advised Employee of the legal requirements of that Act and this
Agreement fully incorporates those legal requirements by reference and as
follows:

 

a.                                      This Agreement is written in layman’s
terms, and Employee hereby represents to the Company that Employee understands
and comprehends its terms;

 

b.                                      Employee is hereby advised to consult an
attorney to review this Agreement prior to executing it;

 

c.                                       This Agreement specifically refers to
rights and claims arising under the Age Discrimination in Employment Act;

 

d.                                      Employee does not waive any rights or
claims that result from events occurring after the date this Agreement is
executed by Employee;

 

e.                                       Employee hereby acknowledges that
Employee is receiving consideration beyond anything of value to which Employee
already is entitled;

 

f.                                        Employee has twenty-one days from his
receipt hereof to consider this proposed Agreement.  Employee’s failure to
accept this proposed Agreement by close of

 

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business on the twenty-first day following Employee’s receipt of this Agreement
may be deemed rejection of its terms;

 

g.                                       Employee has the right to revoke this
Agreement for seven days following Employee’s signing of this Agreement, and
after the expiration of that seven days the executed Agreement shall be of full
validity, force, and effect.  Employee shall provide notice of such revocation
in writing to Ted Gentry; such notice shall be delivered to the office of Wyche,
P.A., 44 East Camperdown Way, Greenville, South Carolina 29601 before the end of
the revocation period in order to be effective.

 

24.       Employee has read and fully understands this Agreement and the terms
and release contained herein, and has had an opportunity to seek advice and
counsel before executing this Agreement.  Employee enters this Agreement of
Employee’s own free will.

 

25.       This Agreement shall be governed in all respects by the laws of the
State of South Carolina and federal law as applicable, without regard to choice
of law principles.  Venue for any action arising under or relating to this
Agreement shall lie exclusively in the appropriate state or federal court in
South Carolina.

 

26.       The provisions of this Agreement are severable, and if any clause or
provision shall be held invalid or unenforceable in whole or in part in any
jurisdiction, then such invalidity or unenforceability shall affect only such
clause or provision or part thereof in such jurisdiction and shall not in any
manner affect such clause or provision in this Agreement in any other
jurisdiction.

 

27.       This Agreement may be executed in any number of counterparts, each of
which shall be an original, but all of which taken together shall constitute one
and the same agreement.  Delivery of an executed counterpart of this Agreement
by facsimile or other electronic means shall have the same force and effect as
the delivery of an original executed counterpart of this Agreement.

 

*****

 

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READ CAREFULLY BEFORE SIGNING.

THIS AGREEMENT ENDS ALL CLAIMS AGAINST THE COMPANY AND THE RELEASED PARTIES
IDENTIFIED HEREIN.

 

 

Witnesses:

 

Scio Diamond Technology Corporation

 

 

 

/s/ Witness

 

By:

/s/ Edward S. Adams

 

 

Name: Edward S. Adams

 

 

Title: Chairman of the Board of Directors

/s/ Witness

 

 

 

 

December 5, 2012

 

 

Date

 

 

 

 

 

 

Witnesses:

 

 

 

 

 

/s/ Witness

 

/s/ Charles Nichols

 

 

Charles Nichols

 

 

 

/s/ Witness

 

December 6, 2012

 

 

Date of Execution by Charles Nichols

 

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November 30, 2012

 

Re: Charles G. Nichols, Chief Financial Officer, Scio Diamond Technology
Corporation

 

To Whom It May Concern:

 

Charles Nichols was employed by Scio Diamond Technology Corporation as its Chief
Financial Officer from January 2012 through November 2012.  During this period,
Mr. Nichols contributed to the successful start-up of operations.  The board of
directors appreciates Mr. Nichols’ efforts in this regard and his work on behalf
of the company’s shareholders.

 

 

 

 

 

Edward S. Adams

 

Chairman of the Board

 

Scio Diamond Technology Corporation

 

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