Exhibit 10.2
Sipex Corporation
Separation Agreement and General Release
     This Separation Agreement and General Release (this “Agreement”) is made by
and between Joseph T. Rauschmayer (“Employee”) and Sipex Corporation, a Delaware
corporation (the “Company”). Employee and the Company are collectively referred
to herein as the “Parties.”
RECITALS
     WHEREAS, Employee was employed by the Company;
     WHEREAS, the Employee and the Company entered into an offer letter dated
September 11, 2002 (“the Offer Letter”);
     WHEREAS, the Employee and the Company entered into an Employment Agreement
dated September 30, 2002 (“the Confidentiality Agreement”);
     WHEREAS, the Company and Employee entered into a Stand-Alone Stock Option
Agreement dated September 30, 2002, as amended by that certain memorandum
authored by the Company’s Director of Human Resources, dated September 23, 2003
and subsequently approved by the Company’s Board of Directors, and Non-Qualified
Stock Option Agreements dated October 1, 2003 and December 20, 2004 granting
Employee the option to purchase shares of the Company’s common stock subject to
the terms and conditions of the Company’s 1999 and 2002 Stock Option Plans and
the Stock Option Agreements (collectively, the “Stock Agreements”);
     WHEREAS, Employee’s employment with the Company terminated on September 2,
2005;
     WHEREAS, the Parties wish to resolve any and all disputes, claims,
complaints, grievances, charges, actions, petitions and demands that the
Employee may have against the Company as defined herein, including, but not
limited to, any and all claims arising out of, or related to, Employee’s
employment with, or separation from, the Company;
     NOW THEREFORE, in consideration of the promises made herein, the Parties
hereby agree as follows:
AGREEMENT
1. Termination of Employment. Company and Employee acknowledge and agree that
Employee’s employment with the Company terminated on September 2, 2005.
2. Consideration.
     (a) The Company agrees to pay Employee $115,000, less applicable
withholding, to be paid periodically in accordance with the Company’s regular
payroll practices. The first of these payments shall not be due until 8
(eight) business days after this agreement is signed. Employee acknowledges that
Company will issue to him a Form W-2 in connection with said payment.

 

--------------------------------------------------------------------------------

 

     (b) Stock. The Parties agree that for purposes of determining the number of
shares of the Company’s common stock which Employee is entitled to purchase from
the Company, pursuant to the exercise of outstanding options, the Employee will
be considered to have vested only up to the Termination Date. On the date of
Termination 50% of any unvested shares under the Stock Agreements shall
immediately vest and become exercisable and together with all other shares
vested as of the termination date and upon approval of the Company’s board of
directors or the Company’s compensation committee, remain exercisable twelve
months from the time the options become exercisable under the Federal and State
security laws until the earlier of (i) the original term of the option or
(ii) twelve (12) months from the date the options become exercisable under the
Federal and State security laws. The exercise of any stock options shall
continue to be subject to the terms and conditions of the Stock Agreements and
the 1999 and 2002 Stock Option Plans. Company agrees to notify Employee when the
options become exercisable.
     (c) Benefits. Employee’s health insurance benefits shall cease on
September 2, 2005, subject to Employee’s right to continue his health insurance
under COBRA. The Employee has the option, at the Employee’s own expense, to
extend the health insurance coverage currently provided by the Company for a
period of 18 months from the Termination Date pursuant to the terms and
conditions of COBRA. The Employee acknowledges that the Employee has sixty
(60) days from the Termination Date (or receipt of this notice, whichever is
later) to notify the Company in writing of the Employee’s election to so
continue such coverage. Your first monthly premium covering the period
September 3, 2005 through September 30, 2005, will be paid by Sipex. Employee’s
participation in all other benefits and incidents of employment (including, but
not limited to, the accrual of vacation and paid time off, and the vesting of
stock options) ceased on the Termination Date.
     (d) Tax Treatment. The Company makes no representations or warranties with
respect to the tax consequences of the payment of any sums to Employee under the
terms of this Agreement, including the payment made to Employee’s attorney.
Employee agrees and understands that, with the exception of the employer
withholding addressed in paragraph 1(a) above, he is responsible for payment of
any local, state and/or federal taxes on the sums paid hereunder by the Company
and any penalties or assessments thereon. Employee further agrees to indemnify
and hold the Company harmless from any claims, demands, deficiencies, penalties,
assessments, executions, judgments, or recoveries by any government agency
against the Company for any amounts claimed due on account of Employee’s failure
to pay federal or state taxes or damages sustained by the Company by reason of
any such claims, including reasonable attorney fees.
3. Confidential Information. Employee shall continue to comply with the terms
and conditions of the Confidentiality Agreement (a copy of which is attached
hereto as Exhibit A) and maintain the confidentiality of all of the Company’s
confidential and proprietary information. Employee shall also return to the
Company all of the Company’s property, including all confidential and
proprietary information, and all documents and other information that Employee
obtained in connection with his employment with the Company, on or before the
Effective Date of this Agreement. Such information includes, but is not limited
to, all customer lists, equipment, records, data, notes, reports, proposals,
correspondence, specifications, drawings, blueprints, sketches, materials, or
other documents or property belonging to the Company, that were in the
Employee’s possession or control. The Employee represents that the Employee has
not retained reproductions or copies of any of the above, whether in tangible,
electronic, or other form.
4. Payment of Salary. Employee acknowledges and represents that the Company has
paid the Employee all salary, wages, bonuses, incentive pay, commissions,
profit-sharing, reimbursable expenses, accrued vacation, interest, stock, stock
options, outplacement costs, fees and any and all other benefits and
compensation due to Employee. The Employee acknowledges that the Company does
not owe the Employee any additional amount (other than the consideration
provided for in paragraph 1 of

2

--------------------------------------------------------------------------------

 

this Agreement) and will not owe the Employee any additional amounts based on
the occurrence of any future events.
5. Release of Claims. The Parties agree that the foregoing consideration
represents settlement in full of all outstanding obligations owed by each party
to the other, including their respective current and former: officers,
directors, employees, agents, investors, attorneys, shareholders,
administrators, affiliates, divisions, subsidiaries, predecessor and successor
corporations and assigns (the “Releasees”). The Parties, on behalf of themselves
and on behalf of their respective current and former: officers, directors,
employees, agents, investors, attorneys, shareholders, administrators,
affiliates, divisions, subsidiaries, predecessor and successor corporations,
heirs, family members, executors, agents, and assigns, hereby fully and forever
release each other and the other Releasees from, and agree not to sue
concerning, any claim, duty, obligation or cause of action relating to any
matters of any kind, whether presently known or unknown, suspected or
unsuspected, that they may possess arising from any omissions, acts or facts
that have occurred up until and including the Effective Date of this Agreement
including, without limitation:
     (a) any and all claims relating to or arising from Employee’s employment
relationship with the Company or the termination of that relationship (with the
exception of any claims for unemployment or workers’ compensation to the extent
applicable law provides that those claims may not be released);
     (b) any and all claims relating to, or arising from, Employee’s right to
purchase, or actual purchase of, shares of Company stock, including, but not
limited to, any claims for fraud, misrepresentation, breach of fiduciary duty,
breach of duty under applicable state corporate law, and securities fraud under
any state or federal law;
     (c) any and all claims under the law of any jurisdiction, including, but
not limited to, wrongful discharge of employment; constructive discharge from
employment; termination in violation of public policy; discrimination;
harassment; breach of contract, both express and implied; breach of a covenant
of good faith and fair dealing, both express and implied; promissory estoppel;
negligent or intentional infliction of emotional distress; negligent or
intentional misrepresentation; negligent or intentional interference with
contract or prospective economic advantage; unfair business practices;
defamation; libel; slander; negligence; personal injury; assault; battery;
invasion of privacy; false imprisonment; and conversion;
     (d) any and all claims for violation of the federal, or any state,
constitution, and claims for violation of any federal, state or municipal
statute, including, but not limited to, Title VII of the Civil Rights Act of
1964, the Civil Rights Act of 1991, the Age Discrimination in Employment Act of
1967, the Older Workers Benefit Protection Act, the Americans with Disabilities
Act of 1990, the Rehabilitation Act of 1973, the Fair Labor Standards Act, the
Employee Retirement Income Security Act of 1974, the Family and Medical Leave
Act, the Worker Adjustment and Retraining Notification Act, the Fair Credit
Reporting Act, the California Fair Employment and Housing Act, the California
Family Rights Act, and the California Labor Code;
     (e) any and all claims arising out of any other laws and regulations
relating to employment or employment discrimination;
     (f) any and all claims for any loss, cost, damage, or expense arising out
of any dispute over the non-withholding or other tax treatment of any of the
proceeds received by Employee, as a result of this Agreement; and

3

--------------------------------------------------------------------------------

 

     (e) any and all claims for attorneys’ fees and costs.
     The Company and Employee agree that the release set forth in this section
shall be and remain in effect in all respects as a complete general release as
to the matters released. Notwithstanding, the Parties agree that nothing herein
shall constitute a waiver or release of any claims the Company may have against
Employee for fraud, embezzlement, or any other criminal conduct. This release
does not extend to any obligations incurred under this Agreement.
6. Acknowledgement of Waiver of Claims Under ADEA. Employee acknowledges that he
is waiving and releasing any rights he may have under the Age Discrimination in
Employment Act of 1967 (“ADEA”) and that this waiver and release is knowing and
voluntary. Employee and the Company agree that this waiver and release does not
apply to any rights or claims that may arise under the ADEA after the Effective
Date of this Agreement. Employee acknowledges that the consideration given for
this waiver and release Agreement is in addition to anything of value to which
Employee was already entitled. Employee further acknowledges that he has been
advised by this writing that:
          (a) he should consult with an attorney prior to executing this
Agreement;
          (b) he has up to twenty-one (21) days within which to consider this
Agreement;
          (c) he has seven (7) days following his execution of this Agreement to
revoke this Agreement;
          (d) this ADEA waiver shall not be effective until the revocation
period has expired; and,
          (e) nothing in this Agreement prevents or precludes Employee from
challenging or seeking a determination in good faith of the validity of this
waiver under the ADEA, nor does it impose any condition precedent, penalties or
costs for doing so, unless specifically authorized by federal law.
7. Civil Code Section 1542. The Parties represent that they are not aware of any
claims against any of the Releasees. The Parties also acknowledge that they have
been advised to consult with legal counsel and are familiar with the provisions
of California Civil Code Section 1542, which provide as follows:
A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH
IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH
THE DEBTOR.
The Parties, being aware of this code section, agree to expressly waive any
rights they may have thereunder, as well as under any other statute or common
law principles of similar effect.
8. No Pending or Future Lawsuits. The Parties represent that they have no
lawsuits, claims, or actions pending in their respective names, or on behalf of
any other person or entity, against the other party or any of the other
Releasees. The Parties also represent that they do not intend to

4

--------------------------------------------------------------------------------

 

bring any claims on their own behalf or on behalf of any other person or entity
against the other party or any of the other Releasees.
9. Nondisparagement. The Employee agrees to refrain from any defamation, libel
or slander of the Company or its products, services, officers, directors,
employees, or other representatives. The Employee further agrees to refrain from
any tortious interference with the contracts and relationships of the Company.
All inquiries by potential future employers of Employee will be directed to
Sipex’s Human Resources Department, and the Company will only state the
following: Employee’s last position and dates of Employment, and any other
information and/or documentation legally required to be disclosed.
10. No Cooperation With Third Parties. Employee agrees that he will not counsel
or assist any attorneys or their clients in the presentation or prosecution of
any disputes, differences, grievances, claims, charges, or complaints by any
third party against the Company and/or any officer, director, employee, agent,
representative, shareholder or attorney of Company, unless under a subpoena or
other court order to do so. Employee further agrees to immediately notify Stuart
Schneck, General Counsel of the Company, upon receipt of any such court order,
subpoena, or any legal discovery device, including any such court order,
subpoena or legal discovery device that seeks or might require the disclosure or
production of the existence or terms of this Agreement. Employee further agrees
to furnish, within three (3) business days of its receipt, a copy of such court
order, subpoena or legal discovery device to the Company. Notwithstanding the
foregoing or any other provision of this Agreement, each Party understands and
agrees that both the Company and Employee shall cooperate fully with the
Securities and Exchange Commission with respect to any inquiry or investigation
it undertakes in connection with the Matter of Sipex Corporation (SF2938), any
other governmental investigations or actions that might be brought by the
Securities and Exchange Commission or the Department of Justice or any related
issues. Notwithstanding, nothing herein shall be construed so as to limit
Employee’s right to assert any constitutional rights or privileges he may enjoy
in connection with said investigations, actions or matters.
11. Cooperation with Company. Employee agrees that Employee shall cooperate
fully with the Company in the resolution of any matters in which Employee was
involved in during the course of Employee’s employment, or about which Employee
has knowledge, including but not limited to any inquiry or investigation
undertaken by the Securities and Exchange Commission with respect to the Matter
of Sipex Corporation (SF2938), any other governmental investigations or actions
that might be brought by the Securities and Exchange Commission or the
Department of Justice any other legal matters, including the defense or
prosecution of any claims or actions now in existence or which may be brought or
threatened in the future against or on behalf of the Company, including any
claims or actions against its officers, directors and employees.
Employee’s cooperation in connection with such matters, actions and claims shall
include, without limitation, being available to consult with the Company
regarding legal matters in which Employee has been involved or about which
Employee has knowledge; assisting the Company in preparing for any proceeding
related to such matters (including, without limitation, depositions,
consultation, discovery, hearings or trial); to provide affidavits reflecting
truthful written testimony; to assist with any audit, inspection, hearing,
proceeding or other inquiry; and to act as a witness to provide truthful
testimony in connection with any hearing, litigation or other legal

5

--------------------------------------------------------------------------------

 

proceeding affecting the Company. Employee further agrees that should Employee
be contacted (directly or indirectly) by any person or entity adverse to the
Company, or any representative of such person or entity, Employee shall promptly
(no later than within 48 hours of such contact), notify Stuart Schneck, General
Counsel at the Company. In the event the Company specifically requests the
Employees assistance in the matters described above, the Employee shall be
reimbursed for any documented and reasonable fees and expenses incurred in
connection with providing such cooperation under this Section. Specifically, the
Company agrees that it shall reimburse Employee for his time at the hourly rate
of $200.00 per hour, provided that in order to be reimbursed, the Company must
request such service and the Company’s request for service or assistance must be
made in writing. Notwithstanding, nothing herein shall be construed so as to
limit Employee’s right to assert any constitutional rights or privileges he may
enjoy in connection with said investigations, actions or matters.
12. Non-Solicitation. Employee agrees that for a period of twelve (12) months
immediately following the Effective Date of this Agreement, Employee shall not
directly or indirectly solicit any of the Company’s employees to leave their
employment at the Company.
13. No Admission of Liability. The Parties understand and acknowledge that this
Agreement constitutes a compromise and settlement of disputed claims. No action
taken by the Parties, previously or in connection with this Agreement, shall be
construed to be: (a) an admission of the truth or falsity of any claims made, or
(b) an admission by either party of any fault or liability whatsoever to the
other party or to any third party. This Agreement will be given the maximum
protection allowable under California Evidence Code Section 1152 and/or any
other state or Federal provisions of similar effect.
14. Breach. The Parties acknowledge and agree that any breach of any provision
of this Agreement, except as permitted by paragraph 6(e), shall constitute a
material breach of this Agreement and shall entitle the Company immediately to
recover and/or cease the consideration provided to Employee under this
Agreement.
15. Costs. With the exception of the payment referenced in paragraph 1(b) above,
the Parties shall each bear their own costs, expert fees, attorney fees and
other fees incurred in connection with the preparation of this Agreement.
16. Arbitration. The Parties agree that any and all disputes arising out of, or
relating to, the terms of this Agreement, their interpretation, and any of the
matters herein released, shall be subject to binding arbitration in Santa Clara
County before the American Arbitration Association under its National Rules for
the Resolution of Employment Disputes. The Parties agree that the prevailing
party in any arbitration shall be entitled to injunctive relief in any court of
competent jurisdiction to enforce the arbitration award. The Parties agree that
the prevailing party in any arbitration shall be awarded its reasonable attorney
fees and costs. The Parties hereby agree to waive their right to have any
dispute between them resolved in a court of law by a judge or jury. This section
will not prevent either party from seeking injunctive relief (or any other
provisional remedy) from any court having jurisdiction over the Parties and the
subject matter of their dispute relating to the Parties’ obligations under this
Agreement and the agreements incorporated herein by reference.
17. Attorney’s Fees. If any action at law or in equity is brought to interpret
or enforce the terms of this Agreement, the prevailing party will be entitled to
recover its costs and expenses from the other party, including the costs of
mediation, arbitration, litigation, court fees, plus reasonable attorneys’ fees,

6

--------------------------------------------------------------------------------

 

incurred in connection with such action, in addition to any other relief to
which such prevailing party may be entitled.
18. Entire Agreement. This Agreement represents the entire agreement and
understanding between the Parties concerning the subject matter of this
Agreement and the Employee’s relationship with the Company, and supersedes and
replaces any and all prior understandings, negotiations and agreements, written
or oral, concerning the subject matter of this Agreement and Employee’s
relationship with the Company, with the exception of the Confidentiality
Agreement, and the Stock Agreements.
19. No Oral Modification. Any modification or amendment of this Agreement, or
additional obligation assumed by either party in connection with this Agreement,
shall be effective only if placed in writing and signed by both Parties or their
authorized representatives.
20. No Representations. Each party represents that it has had the opportunity to
consult with an attorney, and has carefully read and understands the scope and
effect of the provisions of this Agreement. Neither party has relied upon any
representations or statements made by the other party hereto which are not
specifically set forth in this Agreement.
21. No Waiver. The failure of the Company to insist upon the performance of any
of the terms and conditions in this Agreement, or the failure to prosecute any
breach of any of the terms and conditions of this Agreement, shall not be
construed thereafter as a waiver of any such terms or conditions. This entire
Agreement shall remain in full force and effect as if no such forbearance or
failure of performance had occurred.
22. Severability. In the event that any provision in this Agreement becomes or
is declared by a court of competent jurisdiction to be illegal, unenforceable,
or void, this Agreement shall continue in full force and effect without said
provision so long as the remaining provisions remain intelligible and continue
to reflect the original intent of the Parties.
23. Governing Law. This Agreement shall be construed, interpreted, governed and
enforced in accordance with the laws of the State of California, without regard
for choice-of-law provisions.
24. Effective Date. This Agreement is effective after it has been signed by both
parties and after eight (8) days have passed following the date Employee signed
the Agreement, provided Employee does not revoke the Agreement before that time
per paragraph 6(c), (the “Effective Date”).
25. Counterparts. This Agreement may be executed in counterparts, and each
counterpart shall have the same force and effect as an original and shall
constitute an effective, binding agreement on the part of each of the
undersigned.
26. Voluntary Execution of Agreement. This Agreement is executed voluntarily and
with the full intent of releasing all claims, and without any duress or undue
influence by any of the Parties. The Parties acknowledge that:
     (a) They have read this Agreement;
     (b) They have been represented in the preparation, negotiation, and
execution of this Agreement by legal counsel of their own choice or that they
have voluntarily declined to seek such counsel;
     (c) They understand the terms and consequences of this Agreement and of the
releases it contains; and
     (d) They are fully aware of the legal and binding effect of this Agreement.

7

--------------------------------------------------------------------------------

 

     IN WITNESS WHEREOF, the Parties have executed this Agreement on the dates
set forth below.

              NAME       Sipex Corporation
 
            Dated: September 2, 2005       Dated: September 2, 2005
 
            /s/ Joe Rauschmayer
 
Signature
      By:   /s/ Clyde R. Wallin
 
           
Joe Rauschmayer
          Clyde R. Wallin           Printed Name       Printed Name and Title
 
            Address:       Address:
13877 Lynde Avenue
           
 
                    233 South Hillview Drive         Milpitas CA 95035 Saratoga,
CA 95070
 
           

8