SEPARATION AGREEMENT AND GENERAL RELEASE

 

This Separation Agreement and General Release (the “Agreement”) is entered into
by and between SeaChange International, Inc. (the “Company”) and Ira Goldfarb
(the “Employee”).

 

1. Termination of Employment. Employee’s employment ended on August 3, 2012 (the
“Separation Date”). By signing this Agreement, Employee acknowledges receipt of
all salary, bonuses, and other employment compensation due through and including
the Separation Date, except as set forth below in this Section 1. Employee
further acknowledges that the Company has paid Employee for all accrued but
unused paid leave, which totals the gross amount of $5,894.04, representing 4.3
days of vacation. As of the Separation Date, no further leave will be accrued.

 

Within ten (10) days from the date of this Agreement the Company will issue
Employee the following:

 

(i)3,000 shares of common stock, constituting all shares owing to Employee upon
the vesting of RSUs under the retention bonus award made to Employee on July 20,
2011 (the “2011 Retention Award”);

 

(ii)15,381 shares of common stock, constituting all RSUs scheduled to vest on
February 1, 2013 pursuant to RSUs granted in connection with the Company’s
Fiscal 2011 bonus plan (the “FY2011 Bonus Award”);

 

(iii)2,443 shares of common stock, constituting all RSUs scheduled to vest on
February 1, 2013 pursuant to RSUs granted in connection with the Company’s
Fiscal 2012 bonus plan (the “FY2012 Bonus Award”).

 

In addition, Employee shall remain eligible to receive certain cash and RSU
awards under the Company’s fiscal year 2013 bonus plan, with such payments, if
any, to be made at the time and under the terms as would have applied had
Employee remained actively employed by the Company; provided that (1) any
payouts will be pro-rated based on the number of days that have elapsed in the
current 2013 fiscal year as of the Separation Date (i.e., Employee is entitled
to 50.55% of the potential target awards based upon 185 days elapsing out of 366
days in the current fiscal year); and (2) payment shall only be paid to the
extent that Employee achieves his personal goals and all applicable financial
thresholds and requirements are met under the 2013 bonus plan, as calculated
based on the Company’s fiscal 2013 year end financials (note amount is dependent
upon the year end revenue numbers) (the “FY2013 Bonus Award).

 

2. Benefits. Whether or not the Employee signs this agreement, Employee or
Employee’s eligible dependent(s) may be eligible for continuation of Employee’s
group medical and dental insurance coverage for up to eighteen (18) months
following the Separation Date, at his or their own expense, under the federal
law known as COBRA. The Company will provide Employee with further information
relating to Employee’s eligibility for COBRA coverage under separate cover.
Except as provided herein, Employee’s right to any and all Company benefits
terminated on the Separation Date.

 

 

 

 

3. Stock Option and RSUs. All of Employee’s rights and obligations to stock
options and restricted stock units, including without limitation vesting,
exercise and expiration, will continue to be governed by the terms and
conditions of the applicable plan pursuant to which such award was granted
(whether the Company’s Amended and Restated 1995 Stock Option Plan, the
Company’s Amended and Restated 2005 Equity Compensation and Incentive Plan, or
the Company’s 2011 Compensation and Incentive Plan) (as applicable, the “Stock
Plan”) and the agreements in connection therewith pursuant to which the
applicable award was granted (the “Stock Agreement”).

 

4. Severance Payments. If Employee signs this Agreement within forty-five (45)
days and does not revoke Employee’s acceptance within seven (7) days thereafter,
then, in exchange for the promises contained herein, the Company will provide
Employee with the following payments (the “Severance Payments”), which
consideration Employee acknowledges is not otherwise owed to Employee under any
employment agreement (oral or written) or any Company policy or practice:

 

a. In exchange for Employee’s release of claims under the federal Age
Discrimination in Employment law (“ADEA”), the Company shall provide Employee
with six (6) months of severance pay, in the total gross amount of one hundred
seventy five thousand dollars ($175,000.00), payable in equal installments on
the normal twice-monthly payroll schedule, less applicable deductions and
withholdings.

 

b. In exchange for Employee’s release of all other claims of discrimination of
any sort, the Company shall provide Employee with an additional six (6) months
of severance pay, in the total gross amount of one hundred seventy five thousand
dollars ($175,000.00), less applicable deductions and withholdings.

 

c. In exchange for Employee’s release of all other claims of any nature, the
Company shall provide Employee with (a) one (1) year of Company paid COBRA
coverage, or a lesser period until the Employee becomes eligible for health care
coverage from a new employer; (b) the 2011 Retention Award (3,000 vested RSUs),
(c) the FY2011 Bonus Award (15,381 vested RSUs), (d) the 2012 Bonus Award (2,443
vested RSUs), and (e) the payment of potential amounts under the Company’s
fiscal year 2013 compensation and bonus plan (the “FY13 Bonus Play”). For
clarity, assuming all thresholds and goals are met, payments under the FY13
Bonus Plan could constitute up to 50.55% of Employee’s FY2013 Bonus of $200,000,
of which $50,000 is payable in cash and $150,000 is payable in RSUs.

 

The amounts referenced in Paragraphs 4(a) – (d) are collectively referred to
herein as the “Severance Payments.” The payments made on account of Employee’s
annual salary will be paid in twenty four (24) equal installments on the
Company’s regular payroll dates, the first such payment to be made on the first
regular payroll date following the eighth (8th) day after the Company receives
the signed Agreement from Employee (the “Effective Date”). The payment in
respect of the FY2013 Bonus Plan shall, subject to the terms of this Agreement,
be payable at the same time and in the same manner as other recipients of awards
pursuant to the FY2013 Bonus Plan.

 

 

 

 

d. If the Company has advanced a tax payment on behalf of Employee in connection
with shares of restricted stock units (RSU) granted to Employee, Employee agrees
that the amount of any such tax payment made by the Company on his behalf shall
be deducted from the Severance Payments in full and final payment of all taxes
advanced by the Company and owed by Employee.

 

5. Company Property. By signing this Agreement, Employee represents and
acknowledges that Employee has returned to the Company all originals and copies
(both in paper and electronic form) of all Company documents and data and all
Company property, including without limitation, fax machines, scanners, copiers,
Company credit cards and telephone charge cards, manuals, building keys and
passes, courtesy parking passes, diskettes, intangible information stored on
diskettes, software programs and data compiled with the use of those programs,
software passwords or codes, tangible copies of trade secrets and confidential
information, sales forecasts, confidential names and addresses of Company
customers and potential customers, customer lists, confidential customer
contacts, sales information, sales forecasts, memoranda, sales brochures,
business or marketing plans, reports, projections, and all other information or
property held or used by Employee in connection with Employee’s employment with
the Company. Notwithstanding the foregoing, Employee shall be entitled to retain
the personal computer, laptop and cellular phone used in his employment by the
Company, subject to removal therefrom by Employee, which removal Employee hereby
certifies that he has completed, of all Company documents and data.

 

6. General Release of Claims.

 

a. In exchange for the Severance Payments, Employee, on behalf of Employee and
Employee’s spouse, heirs, executors, administrators, trustees, legal
representatives, and assigns, hereby releases, indemnifies, holds harmless and
forever discharges the Company, its predecessors and successors, its past and
present parent corporations, divisions, subsidiaries, and affiliates, and the
past and present officers, directors, employees, consultants, shareholders,
partners, benefit plans, attorneys, agents, and assigns of any of them (any or
all of which are referred to as the “Releasees”), from any and all claims,
demands, liabilities, actions, and causes of action of every name and nature,
whether known or unknown, that Employee now has or ever had from the beginning
of the world to Effective Date or that arise out of or relate to Employee’s
employment by or separation from employment with the Releasees or any of them.
This general release of claims is intended by Employee to be all encompassing
and to act as a full and total release of any legally available claims, whether
specifically enumerated herein or not, that Employee may have or may have had
against the Releasees arising from conduct occurring up to and through the
Effective Date of this Agreement, including but not limited to any and all
claims under local, state or federal law for wrongful discharge, wrongful
termination, or wrongful dismissal; any and all claims for breach of an express
or implied contract, covenant, or agreement; any and all claims for unlawful
discrimination or harassment (including but not limited to claims alleged based
on race, sex, sexual preference or sexual orientation, marital status,
pregnancy, religion, creed, age, handicap, disability, national origin, ethnic
heritage, ancestry, veteran status, retaliation, genetic information or any
other protected classification protected by local, state, or federal law); any
and all claims for violation of any fair employment practice law, including the
Age Discrimination in Employment Act, 29 U.S.C. §621 et seq.; any and all claims
under the Family and Medical Leave Act, or any other federal, state or local law
concerning leaves of absence; any and all claims under the Worker Adjustment and
Retraining Notification (“WARN”) Act or any other local, state, or federal law;
any and all claims under the Employee Retirement Income Security Act (other than
claims against an employee benefit plan seeking payment of a vested benefit
under the terms of that plan); any and all claims pursuant to any other state
law, including but not limited to, the Pennsylvania Human Relations Act, 43 P.S.
§ 951, et seq., the Pennsylvania Equal Pay Law, 43 P.S. §§ 336.1-336.10, and the
Pennsylvania Protection of Employees Act, 34 Pa. Code § 319.1 et seq.; any and
all claims for infliction of emotional distress; any and all claims for
defamation; any and all claims for invasion of any right of privacy; any and all
negligence claims; any and all tort claims; any and all statutory claims; any
and all constitutional claims; any and all claims for violation of any civil
rights; any and all claims for reinstatement or reemployment by the Releasees;
any and all claims for wages, bonuses, incentive compensation, equity
compensation, stock payments or appraisal rights, phantom stock payments, or
other compensation or benefits, and any and all claims for compensatory or
punitive damages, interest, attorney’s fees, or costs, including costs and fees
already incurred.

 

 

 

 

b. This release shall not be construed to impair Employee’s right to enforce the
terms of this Agreement. Nor does this release waive Employee’s right to seek a
judicial determination of the validity of his waiver of ADEA rights and claims.

 

c. This release does not include any claim which, as a matter of law, cannot be
released by private agreement. Nor does this release prohibit or bar Employee,
nor the Directors or Officers of the Company from providing truthful testimony
in any legal proceeding, from cooperating with, or making truthful disclosures
to, any local, state, or federal anti-discrimination agency. Notwithstanding the
foregoing, with respect to any claim that can be released by private agreement,
Employee agrees to release and waive Employee’s right (if any) to any monetary
damages or other recovery as to such claims, including any claims brought on
Employee’s behalf, either individually or as part of a collective action, by any
governmental agency or other third party.

 

7. Non-Filing of Claims. Employee represents and warrants that Employee has not
filed any complaints, charges or claims for relief against any of the Releasees
with any local, state or federal court or administrative agency.

 

8. Non-Disparagement. Except as permitted by Section 6(c), Employee agrees not
to make any statement, written or oral, which disparages the Company, its
products or services, or any of its directors, officers, employees, or agents,
it being understood and agreed that factual statements made in the ordinary
course of conducting commercial business shall not be deemed to constitute
disparagement. Except as permitted by Section 6 (c), neither the Directors nor
Officers of the Company shall make any statement written or oral which
disparages the Employee.

 

 

 

 

9. Cooperation. Employee hereby agrees to provide commercially reasonable
assistance to and cooperation with the Company if called upon by it with regard
to: (i) the transition of Employee’s job responsibilities, and (ii) any lawsuit,
claim, action, investigation, administrative review or otherwise that may be
brought by a third party against the Company and which may involve facts or
knowledge of which Employee may be aware as a result of Employee’s employment or
position with the Company. The Company will reimburse Employee for any
reasonable out of pocket expenses incurred by Employee in connection with the
foregoing.

 

10. Waiver of Rights and Claims Under the Age Discrimination in Employment Act.
Because Employee is forty (40) years of age or older, Employee is protected
against age discrimination by the federal Age Discrimination in Employment Act.
Employee has or may have specific rights and/or claims under the Age
Discrimination in Employment Act of 1967 (ADEA) and the Employee agrees that:

 

(a) In consideration for the amounts described in Section 4(a) of this
Agreement, which Employee is not otherwise entitled to receive, Employee
specifically and voluntarily waives such rights and/or claims under the ADEA, as
amended by the Older Workers Benefit Protection Act, that Employee might have
against the Company Releasees to the extent such rights and/or claims arose
prior to the date this Agreement was executed.

 

(b) Employee understands that rights or claims under the ADEA which may arise
after the date this Agreement is executed are not waived by Employee.

 

(c) The Company has advised Employee that Employee has at least forty-five (45)
days within which to consider the terms of this Agreement (including all
Exhibits). The Company advises Employee to consult with or seek advice from an
attorney of Employee’s choice prior to executing this Agreement. If Employee
signs this Agreement in fewer than forty-five (45) days, Employee acknowledges
that the decision was entirely voluntary and that Employee was given the full
forty-five (45) days to consider the Agreement. If Employee does not sign this
Agreement and return it to the Company within forty-five (45) days, the offer
contained herein shall be null and void.

 

(d) The forty-five (45) day review period will not be affected or extended by
any revisions, whether material or immaterial, that might be made to this
Agreement.

 

(e) Employee understands that Employee may revoke this Agreement for a period of
seven (7) days after signing this Agreement, and that it shall not be effective
or enforceable until the expiration of this seven (7) day Revocation Period. To
revoke this Agreement, a written notice of revocation must be received by Human
Resources at the Company within the 7-day revocation period.

 

 

 

 

(f) Employee has carefully read and fully understands all of the provisions of
this Agreement, and Employee knowingly and voluntarily agrees to all of the
terms set forth in this Agreement; and

 

(g) In entering into this Agreement Employee is not relying on any
representation, promise or inducement made by the Company or its attorneys with
the exception of those promises described in this document.

 

11. Binding Nature of Agreement. This Agreement shall be binding on and inure to
the benefit of Employee and Employee’s heirs, administrators, representatives,
and executors. Employee’s obligations under this Agreement are personal and may
not be assigned. The Company may assign its rights and obligations under this
Agreement. This Agreement shall be binding upon and inure to the benefit of the
Company and its successors and assigns.

 

12. Use of the Agreement as Evidence; Liability. This Agreement may not be used
as evidence in any proceeding of any kind, except a proceeding in which one of
the parties or a Releasee alleges a breach of the terms of this Agreement or
elects to use this Agreement as a defense to any claim. This Agreement shall not
constitute an admission or acknowledgment of liability or wrongdoing on the part
of any or all of the Releasees.

 

13. Nondisclosure and Noncompetition Obligations. During the period of
Employee’s employment by the Company and for one year thereafter, Employee
agrees that he will not, directly or indirectly, alone or as a partner, officer,
director, employee or stockholder of any entity, (a) engage in any business
activity which is in direct competition with the products or services being
developed, manufactured or sold by the Company or (b) solicit, interfere with or
endeavor to entice away any employee of the Company. The period following the
termination of Employee’s employment during which these restrictions apply (the
"Post-employment Period") shall be extended by the length of any period of time
during the Post-employment Period during which Employee is in violation of this
paragraph. If Employee is offered a position with a company and Employee is
uncertain whether accepting such a position would be prohibited under this
Section 13, Employee may notify the Company of the name of the company offering
Employee the position with a description of the position and the role and
responsibilities. The Company will review with Employee the nature of the
position and the responsibilities of the role and will not unreasonably withhold
consent to join the company based on the nature of the role.

 

14. Consequences of Breach. Employee understands and agrees that the Company may
terminate Employee’s eligibility for the Severance Pay if Employee violates this
Agreement, and that the Company shall further have the right to recover from
Employee any Severance Pay paid to Employee or on Employee’s behalf during any
time periods following the commencement of any such breach. Employee further
agrees that a breach of Paragraphs 5, 7, 8 9 and/or 13 herein would result in
irreparable harm to the Company and that money damages would not provide an
adequate remedy. Therefore, Employee agrees that in addition to any other rights
that it may have, the Company shall have the right to specific performance and
injunctive relief in the event Employee breaches any of those Paragraphs of this
Agreement.

 

 

 

 

15. Entire Agreement; Modification. With the exception of the Noncompetition
Agreement, the Stock Plans, and the Stock Agreements, all of which shall remain
in full force and effect, this Agreement is the entire agreement between the
Company and Employee and all previous agreements or promises between them are
superseded and void. This Agreement may be modified only by a written agreement
signed by Employee and an officer of the Company.

 

16. Acknowledgements. By signing this Agreement, Employee acknowledges that
Employee has carefully read and fully understands this Agreement, Employee is
not relying on any representations by any representative of the Company
concerning the meaning of any aspect of this Agreement, Employee has had
forty-five (45) days to review this Agreement, and Employee is signing it
voluntarily.

 

17. Governing Law; Interpretation. In the event of any dispute, this Agreement
will be construed as a whole, will be interpreted in accordance with its fair
meaning, and will not be construed strictly for or against either Employee or
the Company. The law of the Commonwealth of Massachusetts will govern any
dispute about this Agreement. If for any reason any part of this Agreement shall
be determined to be unenforceable, the remaining terms and conditions shall be
enforced to the fullest extent possible.

 

IN WITNESS WHEREOF, the parties have executed this Agreement under seal as of
the date last written below.

 

 

 

 

 

/s/ Ira Goldfarb   August 15, 2013

 

 

 

 

SEACHANGE INTERNATIONAL, INC.

 

 

 

By: /s/ Raghu Rau   August 15, 2013   Raghu Rau       Chief Executive Officer