EXHIBIT 10.1
SEPARATION AND RELEASE AGREEMENT
     THIS SEPARATION AND RELEASE AGREEMENT (the “Agreement”) is entered into as
of October 29, 2007, by and between Gregory Clendenin (the “Employee”) and
Sunair Southeast Pest Holdings, Inc., a Florida corporation (the “Company”).
WITNESSETH:
     WHEREAS, the Employee was employed by the Company to serve as the Chief
Executive Officer of the Company and Middleton Pest Control, Inc. (“Middleton”),
a wholly-owned subsidiary of the Company, pursuant to an employment agreement
dated June 7, 2005 (the “Employment Agreement”);
     WHEREAS, the Employee has decided to retire and has resigned from all
positions that he holds with the Company as an executive officer and employee
effective of October 29, 2007 and will receive compensation pursuant to the
terms and conditions contained herein;
     NOW, THEREFORE, Employee and the Company, intending to be legally bound
hereby and in consideration of the promises contained herein, do hereby agree as
follows:
     1. RESIGNATION. The Employee agrees to resign (i) from his position as the
Chief Executive Officer of the Company, (ii) from his position as the Chief
Executive Officer of Middleton and (iii) from any other positions that he holds
with the Company, Middleton or any other affiliated companies (“Affiliated
Companies”) of the Company or Middleton, effective as of the end of the business
day on Monday, October 29, 2007 (the “Resignation Date”). The Employee
acknowledges and agrees that after the Resignation Date, he will not have the
authority to represent or bind the Company, Middleton or any affiliated
companies as an officer or employee.
2. TERMINATION OF EMPLOYMENT AGREEMENT AND OPTIONS.
          2.1 Employee acknowledges and agrees that this Agreement shall serve
to terminate his employment agreement (“Employment Agreement”) with the Company
dated June 7, 2005, except as described herein, and this Agreement sets forth
all of the compensation payable to him effective as of the date of this
Agreement.
          2.2 The Employee acknowledges and agrees that except for certain
compensation earned in October, 2007, but not yet paid, the Company has paid him
all wages and any other compensation that is payable to him under his Employment
Agreement, including but not limited to all salary payments, bonuses, incentive
compensation, reimbursement for his business expenses and vacation pay, to which
he is entitled under the Employment Agreement or otherwise in connection with
his employment with the Company. The Employee further acknowledges that, except
as described in this Agreement, his eligibility to participate in any of the
Company’s benefit programs, including, but not limited to, participation in
(a) the Company’s bonus plan, described in Section 3(b) and Exhibit A of the
Employment Agreement, (b) employee benefits plans, such as 401(k), savings,
pension, shared and deferred compensation plans and (c) health insurance
benefits, such as medical, dental, hospitalization, disability, life insurance
and other plans offered to the Company’s executives, have been terminated as a
result of the termination of the Employment Agreement.

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          2.3 The Employee agrees that he will have until October 29, 2008, to
exercise any vested options (“Vested Options”) that have been granted to him by
Sunair Services Corporation, a Florida corporation (“Sunair”), the parent of the
Company, during the term of his employment with the Company. The Employee
acknowledges and agrees that the only Vested Options that he owns as of the date
of this Agreement are as follows: options to purchase 23,812 shares of Sunair’s
common stock at an exercise price of $ 11.40 per share. The Employee agrees that
any of the Vested Options, listed in this Section 2.2, which the Employee has
not exercised by October 29, 2008 will be deemed to be cancelled, null and void
at the end of the business day.
          2.4 The Company and the Employee acknowledge the termination of the
Employment Agreement, except for the covenants and obligations set forth in
Sections 7 through 12 of the Employment Agreement, which by their terms survive
the termination of the Employment Agreement and are incorporated herein by
reference. The Employee acknowledges and agrees that he will comply with the
obligations and covenants set forth in Sections 7 through 12 of the Employment
Agreement for the applicable time periods set forth in the Employment Agreement.
The Employee acknowledges that his covenants and obligations set forth in the
Stock Purchase Agreement (“Stock Purchase Agreement”) dated June 7, 2005 by and
among the Company, the Employee, Charles P. Steinmetz and certain trusts
associated with the Employee and Charles P. Steinmetz, which by their terms
survive the closing of the Stock Purchase Agreement, including but not limited
to Section 7(d) of the Stock Purchase Agreement (the “Applicable Provisions”),
continue to apply to him and will remain in effect until June 6, 2010. The
Employee agrees that the Applicable Provisions of the Stock Purchase Agreement
are incorporated into this Agreement by reference.
          2.5 The Company and the Employee have agreed to enter into a
consulting agreement (“Consulting Agreement”) for a period of twelve months
after the Resignation Date pursuant to which the Employee will provide
consulting services to the Company and the Affiliated Companies in areas of his
expertise and on matters in which he was involved while employed by the Company.
3. SEVERANCE PAYMENTS.
          3.1 Severance Payment. In consideration of the covenants set forth
herein, the Company agrees to pay the Employee a severance payment equal to an
aggregate of $91,500.00, which represents (a) a severance payment of $76,500.00
and (b) twelve months of COBRA reimbursement payments, which is equal to
$15,000.00, to be paid over a six-month period, in accordance with the Company’s
normal payroll practices beginning on November 16, 2007, and ending on May 16,
2008. All compensation payable to the Employee hereunder is stated in gross
amounts and shall be subject to all applicable withholding taxes, other normal
payroll and any other amounts required by law to be withheld.
          3.2 Benefits. The Company will provide the Employee with information
regarding any benefits which may be converted to individual coverage and/or
coverage which includes his spouse in accordance with Consolidated Omnibus
Budget Reconciliation Act

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           (“COBRA”) regulations. Employee acknowledges and agrees that he will
not be entitled to any perquisites, benefits or other compensation whatsoever
after the Resignation Date, except as described in this Agreement.
          3.3 Compliance with Obligations. The Company’s obligations to make
payments to the Employee under this Agreement is conditioned upon the Employee’s
compliance with all of his covenants and obligations contained in (a) this
Agreement, including but not limited to Sections 7 through 12 of the Employment
Agreement and the Applicable Provisions of the Stock Purchase Agreement, which
are incorporated by reference into this Agreement and Mutual Release (b) the
Consulting Agreement.
     4. WAIVER AND RELEASE. For good and valuable consideration, the receipt and
sufficiency of which is acknowledged by the Employee, including the payments to
the Employee as described in Section 3, Employee hereby agrees that his
separation of employment from the Company was not due in any way to age or any
other type of discrimination or any wrongful act of the Company, and Employee
and his Releasors, as hereinafter defined, do hereby voluntarily and fully
release and forever discharge the Company, Middleton, Sunair, any Affiliated
Companies, together with their respective past and current predecessors,
successors, shareholders, officers, directors, employees, attorneys, trustees,
insurers, representatives, contractors, representatives, related organizations,
affiliates and subsidiaries (collectively, the “Released Parties”), jointly and
individually, from any and all claims, demands, debts, causes of action, claims
for relief, and damages, of whatever kind or nature, known or unknown, developed
or undeveloped, which Employee had, now has or may hereinafter have from the
beginning of the world to the date hereof, including, without limitation, all
claims and all rights which the Employee may have under Title VII of the Civil
Rights Act of 1964; the Equal Employment Opportunity Act of 1972; the Civil
Rights Act of 1991; the Age Discrimination and Employment Act of 1967; the
Employee Retirement Security Act 42 U.S.C. ss. 1981; the Older Workers’ Benefit
Protection Act; the Americans with Disabilities Act; the Family Medical Leave
Act of 1993; the Equal Pay Act; the Fair Labor Standards Act; and any and all
other federal and state statutes which regulate employment; and the laws of
contracts, tort and other subjects.
     5. RELEASED PARTIES AND NO ADMISSION OF LIABILITY. For purposes of
paragraph 4, “Releasors” shall mean, collectively, the spouse of the Employee
and the Employee’s dependents, heirs, executors administrators and assigns, past
and present and each of them and their trustees, directors, officers, agents,
attorneys, insurers, employees, stockholders, representatives, successors,
assigns and all persons acting by, through, under or in connection with them,
past and present. Execution of this Agreement and payment of the payments
specified in paragraph 3 of this Agreement does not constitute an admission by
any Released Party of any violation of any civil rights or other employment
discrimination statute, or any other legal statute, provision, regulation,
ordinance, order or action under common law. Rather, this Agreement expresses
the intention of the parties to resolve all possible issues and other claims
related to or arising out of Employee’s employment by the Company without the
time and expense of litigation.
     6. GOVERNING LAW. The law of the State of Florida shall govern the validity
of this Agreement, the construction of its terms and the interpretation of the
rights and duties of the parties. This Agreement and the Consulting Agreement
constitute the entire agreement and

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understanding between the Employee and the Company regarding the Employee’s
resignation from employment with the Company. Any agreement to amend or modify
the terms and conditions of this Agreement must be in writing and executed by
the parties hereto. This Agreement may be specifically enforced in judicial
proceedings and may be used as evidence in a subsequent proceeding in which a
breach is alleged.
     7. CONFIDENTIALITY. The Employee agrees that he will keep confidential all
information regarding the Company, its business operations and this Agreement,
including, but not limited to, information about pricing, customers, current and
former employees and will not disclose such information to anyone unless such
information is published and becomes public knowledge (other than through or by
the Employee on his behalf), (ii) required by legal process in formal legal
proceeding or (iii) to the extent necessary to report income to the appropriate
taxing authorities. The provisions of this paragraph are in addition to, and not
in lieu of, any other obligations of confidentiality entered into by the
Employee and the Company, Middleton and/or any Affiliated Companies.
     8. NON-DISPARAGEMENT. (a) The Employee agrees that he will not directly or
indirectly, individually or in concert with others for a period of five years
from the date of this Agreement, (i) disparage, interfere with or attempt to
interfere with, the reputation, goodwill, services or business of the Company or
any of the Affiliated Companies and/or the stockholders, directors, officers,
employees, agents or representatives of the Company or any Affiliated Companies
or (ii) engage in any conduct, take any actions or make any statements (oral or
written) to the public, future employers, customers, vendors, the investment
community, the media, current, former or future employees or the Company or any
Affiliated Company, or any other third party whatsoever that is calculated to
have, or reasonably likely or possibly having, the effect of undermining,
disparaging or otherwise reflecting negatively or could reasonably be considered
to undermine, disparage or reflect negatively, on the Company or the Affiliated
Companies or the reputation, goodwill, services and business of the Company or
the Affiliated Companies.
          (b) The Company agrees that it will not directly or indirectly,
individually or in concert with others for a period of five years from the date
of this Agreement, (i) disparage, interfere with or attempt to interfere with,
the reputation, goodwill, services or business of the Employee or (ii) engage in
any conduct, take any actions or make any statements (oral or written) to the
public, future employers, customers, vendors, the investment community, the
media, current, former or future employees or the Company or any Affiliated
Company, or any other third party whatsoever that is calculated to have, or
reasonably likely or possibly having, the effect of undermining, disparaging or
otherwise reflecting negatively or could reasonably be considered to undermine,
disparage or reflect negatively, on the Employee or the reputation, goodwill,
services and business of the Employee.
     9. KNOWING AND VOLUNTARY SETTLEMENT. IN EXECUTING THIS AGREEMENT, EMPLOYEE
HEREBY REPRESENTS THAT HE HAS BEEN AFFORDED A REASONABLE OPPORTUNITY TO CONSIDER
THIS AGREEMENT; THAT HE HAS COMPLETELY AND CAREFULLY READ THIS AGREEMENT; THAT
HE HAS BEEN ADVISED BY THE COMPANY TO CONSULT WITH AN ATTORNEY OF HIS OWN CHOICE
PRIOR TO EXECUTING THIS AGREEMENT,

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AND RELIED ON THE LEGAL ADVICE OF HIS ATTORNEY; THAT HE HAD THE OPPORTUNITY TO
HAVE AN ATTORNEY EXPLAIN TO HIM THE TERMS OF THIS AGREEMENT; THAT HE KNOWS AND
UNDERSTANDS THE CONTENTS OF THIS AGREEMENT; THAT THE TERMS OF THIS AGREEMENT ARE
SATISFACTORY TO AND FULLY UNDERSTOOD AND VOLUNTARILY ACCEPTED BY HIM.
     10. EFFECT OF SETTLEMENT AND INTERPRETATION. The Company and Employee
intend this Agreement to be legally binding upon and inure to the benefit of
each of them and their respective heirs, administrators, executors, successors
and assigns. The language of this Agreement shall be construed as a whole,
according to its fair meaning and intent and not strictly for or against any
party hereto, regardless of who drafted or was principally responsible for
drafting this Agreement. The recitals contained at the beginning of this
Agreement are expressly made a part of this Agreement. Headings are for
convenience only and should not be used in interpreting this Agreement.
     11. SEVERABILITY AND JURY WAIVER. Should any provision of this Agreement be
declared illegal or unenforceable by any court of competent jurisdiction and
cannot be modified to be enforceable, including the general release language,
such provision shall immediately become null and void, leaving the remainder of
the Agreement in full force and effect. However, if any portion of the general
release language is ruled to be unenforceable for any reason, the Company may
request that all or a portion of the consideration paid to the Employee pursuant
to paragraph 3 of this Agreement be repaid by the Employee. The Company and the
Employee each knowingly, intentionally, and irrevocably waive any and all rights
to a jury trial for any litigation or legal proceeding in any way relating to or
arising out of this Agreement or the Employment Agreement.
[Signature Page Follows]

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     IN WITNESS WHEREOF, the aforesaid parties have hereunto set their hands and
seals as of the day below written.

            SUNAIR SOUTHEAST PEST HOLDINGS, INC.
      By:   /s/ John J. Hayes         Name:   John J. Hayes        Title:  
President     

            EMPLOYEE
      /s/ Gregory Clendenin       Gregory Clendenin           

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