Chyron International Corporation

 

-and-

 

MICHAEL KNIGHT

 

COMPROMISE AGREEMENT

WITHOUT PREJUDICE

AND

SUBJECT TO CONTRACT

 

 

 

 

THIS AGREEMENT

is made on the  11  day of February 2004

BETWEEN

: -

1. Chyron International Corporation, Danehill, Lower Earley, Reading, Berkshire,
RG6 4PB (the "Company"); and

2. Michael Knight, Wasdale House, St Pauls Road, Woking, Surrey, GU22 7DZ (the
"Employee").

RECITALS

(A) The Employee is employed by the Company under the terms of a contract of
employment dated 13 September 1996 as amended on 6 November 2003 made between
the Company and the Employee;

(B) The Company is entering into this Agreement for itself and as agent for its
holding Company and subsidiaries within the meaning given by Section 736 of the
Companies Act 1985 ("Associated Companies") and is duly authorised on their
behalf;

(C) The Employee has received independent legal advice from a qualified lawyer
as to the terms and effect of this Agreement.

IT IS AGREED

as follows:

1 TERMINATION OF EMPLOYMENT

The Employee's employment with the Company is deemed to have terminated on 31
January 2004.

2 PAYMENT OF SALARY AND BENEFITS

2.1 The Company will pay to the Employee his normal remuneration including his
accrued but untaken 13 days holiday pay and benefits including his monthly Car
Allowance of GBP792 per month up to and including the Termination Date (less
such sums as the Company is obliged by law to deduct by way of income tax and
employee National Insurance contributions).

2.2 The Company confirms that it will either: -

2.2.1 at the Employee's option exercisable on notice on the Termination Date
maintain the private health insurance cover for the Employee (as enjoyed by the
Employee during his employment) for a period of six months from the Termination
Date subject to the rules of the Scheme. The Employee acknowledges that in
relation to the above benefit as is subject to liability for income tax during
his employment and referred to in P11D's issued to him from to time in each tax
year, he shall in connection with any income tax return to the Inland Revenue
for the tax year 2003/2004 disclose the receipt by him of such above benefit as
part of the overall compensation for loss of employment paid and/or provided to
him in connection with the termination of his employment under the provisions of
this Agreement; or

2.2.2 pay the Employee within 14 days of the Termination Date a sum equivalent
to the cost to the Company of providing this benefit to the Employee as
compensation for the loss of such benefits, which sum will be added to and form
part of the Compensation Payment in Clause 3.1

2.3 The Company confirms that it will extend the Employee's Life Assurance cover
and that a single employer's contribution will be made to the Employee's
personal pension scheme in the sum of GBP10,307.58 (being equivalent to 16.6% of
the Employee's gross salary per month until 31 July 2004 inclusive).

2.4 The Company shall pay the Employee within 14 days of the Termination Date
GBP4,752 being a sum equal to the total aggregate of the monthly Car Allowance
of GBP792 per month for 6 months from the Termination Date. The Employee
acknowledges that in relation to the above benefit as is subject to liability
for income tax during his employment and referred to in P11D's issued to him
from to time in each tax year, he shall in connection with any income tax return
to the Inland Revenue for the tax year 2003/2004 disclose the receipt by him of
such above benefit as part of the overall compensation for loss of employment
paid and/or provided to him in connection with the termination of his employment
under the provisions of this Agreement.

3 COMPENSATION FOR LOSS OF EMPLOYMENT

3.1 As compensation for the termination of the Employee's employment (and
provided that the Employee has returned to the Company a copy of this Agreement
signed by him and his advisor and subject, at all times, to the Employee's
continued compliance with the terms of this Agreement) the Company shall pay to
the Employee the sum of GBP39,250 as compensation for the termination of his
employment (the "Compensation Payment"). The Compensation Payment shall be paid
within 14 days following the Termination Date and receipt by the Employee of a
form P45;

3.2 The first GBP30,000 of the Compensation Payment will be paid by the Company
without deductions for income tax or employee National Insurance contributions
(to the extent this is permitted by law.)

4 Special Bonus and stock options

4.1 The Company shall pay within 14 days of the Termination Date to the Employee
a one time special bonus equal to GBP14,166 (less deductions for PAYE income tax
and employee National Insurance contributions.

4.2 The Company confirms that it will fully vest and extend selected option
grants according to Schedule 3, through 31 December 2004, being the Stock option
vesting/exercise period.

5 TAX INDEMNITY

5.1 The parties believe that the first GBP30,000 of the Compensation Payment can
be paid without any deduction of tax or National Insurance Contributions, as it
is a payment made in compensation for loss of employment. The Compensation
Payment will therefore be paid to the Employee on the basis that this element of
the Compensation Payment is tax-free (and as provided for in Clause 3.2 above)
but the Company gives no warranty to this effect.

5.2 The Employee agrees that he will be responsible for the payment of any tax
and other statutory deductions in respect of all or part of the Compensation
Payment. The Employee agrees to indemnify the Company and each and every
Associated Company on a continuing basis against all such liabilities (other
than as may be prohibited by law and including, but not limited to, any
interest, penalties, costs and expenses), which the Company or any Associated
Company may incur by reason of the Compensation Payment. If the Company or any
Associated Company is notified by the Inland Revenue or any other public
authority of any claim that any such liabilities exist or may exist it will
provide relevant details to the Employee so that he has the opportunity at his
own expense to dispute any such payments with the Inland Revenue or other
relevant authority.

6 COMPANY PROPERTY

6.1 Save as provided in Clause 6.2 below the Employee warrants that on or before
the Termination Date he will return to the Company all documents and
correspondence (including copies), keys, electronic passes, documents,
recordings, photographs, laptop computer, computer software and hardware,
computer discs, microfiches, mobile telephone, company credit or charge cards
and any other property belonging to the Company or any Associated Company
including any copies thereof. The Employee further warrants the he holds no
copies of downloaded information or software belonging to the Company or any
Associated Company and that he has disclosed all passwords or computer access
codes pertaining to Company or any Associated Company equipment.

7 EXPENSES

7.1 The Company will reimburse the Employee for all expenses reasonably and
properly incurred and accounted for in connection with the Employee's employment
up to and including the Termination Date.

8 WAIVER OF CLAIMS

8.1 The Employee agrees to accept the Compensation Payment in full and final
settlement of all claims listed below, whether at Common Law, under statute or
pursuant to European Community Law which he has, or may have, against the
Company, its officers, employees and ex-employees arising directly or indirectly
from the Employee's employment by the Company or its termination for: -

i. unfair dismissal

ii. redundancy

iii. any bona fide expenses

iv. wrongful dismissal

v. breach of contract

vi. breach of the Transfer of Undertakings (Protection of Employment)
Regulations 1981

vii. breach of the Working Time Regulations 1998

viii. breach of the Transnational Information and Consultation of Employees
Regulations 1999

ix. race, sex and disability discrimination

x. personal injury claims that the Employee is aware of or should reasonably be
aware of at the time of signing this Agreement.

8.2 The Employee warrants that he has no claims for holiday pay, outstanding
pay, overtime, bonuses or commission or unlawful deductions from wages and,
further, that he has raised any and all claims that he has or may be entitled to
make against the Company in respect of his employment and its termination,
whether contractual, statutory or otherwise and that other than the claims
listed at sub-clause 8.1 above he warrants that he has no further claims or
potential claims against the Company.

8.3 The Employee warrants that he has not and undertakes that he will not
commence any legal or arbitration proceedings of any nature against the Company
or any Associated Company in any jurisdiction in relation to his employment with
the Company or any Associated Company and/or the termination of such employment.

9 REFERENCE

In consideration for the provisions of Clause 13 below, the Company agrees to
provide a full and fair reference reflecting the Employee's true performance and
track record if so requested by a prospective future Employer.

10 RESIGNATION FROM OFFICE

The Employee will provide to the Company his written resignation from the
offices that he holds with the Company and any of its Associated Companies in
the forms attached at Schedule 1 with effect from the Termination Date and shall
execute such documents and do such other things as are necessary to give effect
to such resignation.

11 FULL DISCLOSURE

The Employee warrants that he has made a full and frank disclosure to Michael
Wellesley- Wesley of all material matters which might reasonably affect the
willingness of the Company or any Associated Company to enter into this
Agreement.

12 RESTRICTIONS ON DISCLOSURE

The Employee warrants that he will not hold himself out as representing the
Company or any Associated Company or make to any third party any critical,
misleading, untrue or derogatory remarks, comments or statements (whether orally
or in writing) about the Company or any Associated Company or their officers,
employees, investors, shareholders, suppliers, customers or clients.

13 CONFIDENTIALITY

13.1 In consideration of the Company agreeing to provide a prospective employer
with an employer's reference reflecting the Employee's true performance and
track record upon request the Employee acknowledges that: -

13.1.1 he continues to be bound by his implied duties as to confidentiality in
respect of Confidential Information (including all private, confidential and/or
secret information concerning the Company's or any Associated Company's
business, business relationships or financial affairs, details of which are not
in the public domain or generally known, such information being highly sensitive
and highly confidential by reason of the damage that could be done to the
Company's or any Associated Company's business to any disclosure to or use by
any third party of any such information; and

13.1.2 he will not disclose the fact or contents of this Agreement without the
prior written consent of the Company except to his partner or his professional
advisers, the Inland Revenue or as otherwise required by law, and that he will
otherwise make no statement or remark to any person or body (including, but not
limited to, the press or other media) relating to the termination of his
employment or this Agreement.

14 EMPLOYEE'S INDEPENDENT LEGAL ADVICE

14.1 The Employee warrants that he has before signing this Agreement taken
advice from Nick Hobden of Thomson, Snell and Passmore (the "Legal Adviser") on
the terms and effect of this Agreement and in particular its effect on his
ability to pursue a complaint before an Employment Tribunal or a court.

14.2 It is a condition of this Agreement that the Employee's Legal Adviser
provides the Certificate annexed to this Agreement at Schedule 2, for which in
return the Company will pay upon presentation by the Legal Adviser an invoice
made out to the Employee (but expressed to be payable by the Company) in the sum
of GBP450 plus VAT in respect of the Employee's legal costs.

15 EMPLOYMENT LEGISLATION

15.1 The Company and the Employee confirm that the conditions regulating this
Agreement under Section 203 of the Employment Rights Act 1996, Section 77 of the
Sex Discrimination Act 1975, Section 72 of the Race Relations Act 1976, Section
288 of the Trade Union and Labour Relations (Consolidation) Act 1992, Section 9
Disability Discrimination Act 1995 and Section 35 of the Working Time
Regulations 1998 are satisfied.

 

16 MISCELLANEOUS PROVISIONS

16.1 In this Agreement "Associated Company" includes the Company, Pro-bel
Limited and any company forming part of the Chyron Corporation which from time
to time is a subsidiary or a holding company of the Company or a subsidiary of
such holding company and "subsidiary" and "holding company" will have the
meanings attributed to them by Section 736 of the Companies Act 1985.

16.2 If the Employee: -

(i) breaches any material term of this Agreement and/or;

(ii) in breach of this Agreement commences proceedings against the Company or
any Associated Company;

then he agrees to immediately repay upon request by the Company a sum equal to
the loss suffered by the Company or any Associated Company which in the
reasonable opinion of the Company's board the Company or the Associated Company
has sustained as a result of any breach by the Employee of (i) above and/or the
amount sought by the Employee by way of compensation or damages as a result of
action anticipated in (ii) above. The Employee agrees and accepts that any such
sums shall be recoverable as a debt.

16.3 This Agreement shall be construed in accordance with the law of England and
Wales and the parties submit to the exclusive jurisdiction of the English and
Welsh courts.

16.4 This Agreement although marked "without prejudice" and "subject to
contract" will upon signature by all parties be treated as an open document
evidencing an agreement binding on the parties.

16.5 This Agreement may be executed by the parties in counterpart which taken
together shall constitute one agreement.

SIGNED by

For and on behalf of Chyron International /s/ M. I. Wellesley-Wesley

M. I. Wellesley-Wesley

in the presence of: /s/ Peter Ead

Peter Ead

 

SIGNED by /s/ Michael Knight

MICHAEL KNIGHT

in the presence of /s/ Peter Ead

Peter Ead

SCHEDULE 1

Wasdale House

St Pauls Road

Woking

Surrey GU22 7DZ

The Directors

Chyron Streaming Services Limited

Danehill

Lower Earley

Reading

Berkshire

RG6 4PB

Dear Sirs

I hereby resign effective from 31 January 2004 as a director of Chyron Streaming
Services Limited and confirm that I have no claim for compensation for such loss
of office except as set out in the Agreement between the Company and I dated 31
January 2004.

Yours faithfully

 

/s/ Michael Knight

MICHAEL KNIGHT

 

SCHEDULE 2

I, Nicholas Hobden, Partner in the firm of Thomson Snell and Passmore of 3
Lonsdale Gardens, Tunbridge Wells, Kent, TN1 1NX hereby confirm as follows:

1. I have given independent legal advice to Michael Knight as to the terms and
effect of the agreement to which this Certificate is scheduled, and in
particular its effect on his ability to pursue his rights, if any, before an
Employment Tribunal.

2. I am a Solicitor of the Supreme Court, that I hold a current Practising
Certificate and that the statutory requirements of Section 203 of the Employment
Rights Act 1996, Regulation 35 of the Working Time Regulations, Section 77 of
the Sex Discrimination Act 1975, Section 72 of the Race Relations Act 1976 and
Section 9(3) of the Disability Discrimination Act 1995 relating to Compromise
Agreements have been met.

3. I am not acting (and have not acted) in relation to this matter for the
Company or any Associated Company.

4. That at the date I gave the advice and as at the date hereof this firm was
and is covered by a contract of insurance or other appropriate indemnity as
required by Section 203(2)(d) of the Employment Rights Act 1996 which covers the
risk of a claim by Michael Knight in respect of any loss arising in consequence
of that advice.

SIGNED:/s/ Nicholas Hobden

Nicholas Hobden

Solicitor of the Supreme Court

Dated 11 February 2004

 

 

 

 

 

 

 

 

 

SCHEDULE 3

 

Grant Date

Option Amount

Option Price

1.

10/27/99

10,000

$0.75

2.

07/25/01

30,000

$0.55

3.

12/13/02

40,000

$0.27

4.

11/07/03

25,000

$0.35