Exhibit 10.21
WAIVER AND RELEASE AGREEMENT
This Waiver and Release Agreement (the “Agreement”) is entered into on this 11th
day of June 2009 by and between David Borshell (“Employee”) and Image
Entertainment, Inc. (the “Company”).
Recitals
WHEREAS, Employee was employed by the Company in the role of President, pursuant
to an Employment Letter Agreement, dated April 1, 2008, as amended on
December 22, 2008 (the “Employment Agreement”);
WHEREAS, the Company notified Employee of its decision to terminate Employee’s
employment with the Company without cause effective March 12, 2009;
WHEREAS, Employee and the Company desire to settle fully and finally all
differences that may exist between them, including, but in no way limited to,
issues related to Employee’s employment and/or termination of employment from
the Company;
NOW, THEREFORE, in consideration of the mutual covenants and promises herein
contained and other good and valuable consideration, receipt of which is hereby
acknowledged, it is hereby agreed by and between the parties as follows:
Agreement
1. Separation of Employment. Employee’s last day of employment with the Company
was March 12, 2009 (the “Termination Date”). As of the Termination Date,
Employee has not been employed by the Company in any capacity, nor has Employee
served the Company as an officer. Moreover, as of the Termination Date, the
Employment Agreement has terminated and is of no further force or effect.
2. Separation Pay and Benefits. In consideration for the promises set forth in
this Agreement, and pursuant to the specific terms set forth in Section 3,
below, the Company shall provide the following separation pay and benefits (the
“Separation Pay and Benefits”) to Employee:
(a) A lump sum amount of One Hundred Eleven Thousand, One Hundred and
Fifty-Three Dollars and 84/100 cents ($111,153.84), which is equal to Employee’s
base salary from March 13, 2009 through June 30, 2009. This payment shall be
made by the Company to Employee on the eighth (8th) day following Employee’s
execution of this Agreement, provided that Employee has not revoked this
Agreement;
(b) All alleged unpaid vacation pay in the total amount of Nine Thousand, Eight
Hundred and Twenty-Four Dollars and 19/100 cents ($9,824.19). This payment shall
be made by the Company to Employee on the eighth (8th) day following Employee’s
execution of this Agreement, provided that Employee has not revoked this
Agreement;
(c) Base salary continuation payments, in the amount of $35,416.67 per month,
for the ten (10) month period beginning July 1, 2009 and ending April 30, 2010,
in accordance with the Company’s regular payroll practices;

 

 

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(d) Reimbursement for the out of pocket expenses Employee has incurred for COBRA
continuation payments made for the months of April, May and June 2009 for
medical and dental insurance continuation coverage for himself and his
dependents. This payment shall be made by the Company to Employee within ten
(10) days of Employee’s submission to the Company of documentation demonstrating
the out of pocket expenses incurred by Employee; and
(e) The full amount of COBRA continuation coverage for Employee’s and his
dependents’ medical and dental insurance for twelve (12) months, beginning on
July 1, 2009 and ending June 30, 2010; provided that Employee is eligible for
COBRA and properly elects such continuation coverage. Such payment shall be made
directly by the Company to the applicable insurance provider.
3. Withholdings. The payments set forth in Section 2(a), (b), and (c) shall be
subject to all applicable federal, state and local withholdings. All of the
payments made to Employee set forth in Section 2 shall be delivered to Employee
by the Company via personal delivery or overnight mail, to Employee’s last known
address of record, on the date(s) described above. In addition, the parties
hereby agree that it is their intention that all payments or benefits provided
under this Agreement comply with Section 409A of the Internal Revenue Code of
1986, as amended (the “Code”) and this Agreement shall be interpreted
accordingly. Employee hereby is advised to seek independent advice from
Employee’s tax advisor(s) with respect to the application of Section 409A of the
Code to any payments under this Agreement. Notwithstanding the foregoing, the
Company does not guarantee the tax treatment of any payments or benefits under
this Agreement, including without limitation under the Code, federal, state or
local laws.
4. Warranty. Employee acknowledges and agrees that the Separation Pay and
Benefits provided to Employee under the terms of this Agreement are in addition
to anything of value to which Employee is otherwise entitled and that Employee
would not receive the Separation Pay and Benefits except for Employee’s decision
to sign this Agreement and to fulfill the promises set forth herein. Employee
further acknowledges that, other than the Separation Pay and Benefits, he has
received all wages, accrued but unused vacation pay, equity interests and other
benefits due him as a result of his employment with and termination from the
Company.
5. Release of Known and Unknown Claims By Employee. In exchange for the
Separation Pay and Benefits set forth in Section 2 above, and in consideration
of the further agreements and promises set forth herein, Employee agrees
unconditionally and forever to release and discharge the Company including the
Company’s current and former officers, directors, shareholders, employees,
representatives, attorneys and agents, as well as all of their predecessors,
parents, subsidiaries, affiliates, successors in interest and assigns
(collectively, the “Releasees”) from any and all claims, actions, causes of
action, demands, rights, or damages of any kind or nature which Employee may now
have, or ever have, whether known or unknown, including any claims, causes of
action or demands of any nature arising out of or in any way relating to
Employee’s employment with, or termination from the Company on or before the
date Employee signs this Agreement.

 

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This release specifically includes, but is not limited to, any claims for fraud;
breach of contract; breach of implied covenant of good faith and fair dealing;
inducement of breach; interference with contract; wrongful or unlawful discharge
or demotion; violation of public policy; assault and battery; invasion of
privacy; intentional or negligent infliction of emotional distress; intentional
or negligent misrepresentation; conspiracy; failure to pay wages, benefits,
vacation pay, severance pay, attorneys’ fees, or other compensation of any sort;
wrongful termination; retaliation; wrongful demotion; discrimination or
harassment on any basis protected by federal, state or local law including, but
not limited to age, race, color, sex, gender identity, national origin,
ancestry, religion, disability, handicap, medical condition, marital status, and
sexual orientation; any claim under Title VII of the Civil Rights Act of 1964,
as amended, the Americans with Disabilities Act, the Age Discrimination in
Employment Act, as amended by the Older Workers Benefit Protection Act, the
California Fair Employment and Housing Act, or Section 1981 of Title 42 of the
United States Code; violation of any safety and health laws, statutes or
regulations; or any other wrongful conduct, based upon events occurring prior to
the date of execution of this Agreement.
Employee further agrees knowingly to waive the provisions and protections of
Section 1542 of the California Civil Code, which reads:
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 intend this release by Employee to be a full and comprehensive
general release waiving and releasing all claims, demands, and causes of action,
known or unknown, to the fullest extent permitted by law. Nothing in this
Agreement is intended to nor shall it be interpreted to release any claim under
California Labor Code Section 2802 or any other claim which, by law, may not be
released.
6. Additional Representations and Warranties By Employee. Employee represents
that Employee has no pending complaints or charges against the Releasees, or any
of them, with any state or federal court, or any local, state or federal agency,
division, or department based on any event(s) occurring prior to the date
Employee signs this Agreement. Employee further represents that Employee will
not in the future, file, participate in, encourage, instigate or assist in the
prosecution of any claim, complaints, charges or in any lawsuit by any party in
any state or federal court against the Releasees, or any of them, unless such
aid or assistance is ordered by a court or government agency or sought by
compulsory legal process, claiming that the Releasees, or any of them, have
violated any local, state or federal laws, statutes, ordinances or regulations
based upon events occurring prior to the execution of this Agreement. Nothing in
this Agreement shall be construed as prohibiting Employee from making a future
claim with the Equal Employment Opportunity Commission or any similar state
agency including, but not limited to the California Department of Fair
Employment and Housing; provided, however, that should Employee pursue such an
administrative action against the Releasees, or any of them, to the maximum
extent allowed by law, Employee agrees and acknowledges that Employee will not
seek, nor shall Employee be entitled to recover, any monetary damages from any
such proceeding.
7. Knowing and Voluntary. Employee represents and agrees that, prior to signing
this Agreement, Employee has had the opportunity to discuss the terms of this
Agreement with legal counsel of his choosing. Employee further represents and
agrees that he is entering into this Agreement knowingly and voluntarily.
Employee affirms that no promise was made to cause him to enter into this
Agreement, other than what is promised in this Agreement. Employee further
confirms that he has not relied upon any statement or representation by anyone
other than what is in this Agreement as a basis for his decision to sign this
Agreement.

 

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8. Knowing and Voluntary Waiver of Age Discrimination Claim. Employee expressly
acknowledges:
• that he has been provided twenty-one (21) days to consider this Agreement;
• that he was informed in writing to consult with counsel regarding this
Agreement;
• that he has consulted with counsel regarding this Agreement;
• that to the extent Employee has taken fewer than twenty-one (21) days to
consider this Agreement, Employee acknowledges that he had sufficient time to
consider the Agreement and to consult with counsel and that he does not desire
additional time;
• that he was informed that the Agreement is revocable by Employee for a period
of seven (7) calendar days following his execution of this Agreement;
• that any revocation must be in writing, must specifically revoke this
Agreement, and must be received by the Company (attn: Jeff Framer) prior to the
eighth calendar day following the execution of this Agreement;
• that Employee understands that if he revokes this Agreement, he will not
receive the Separation Pay and Benefits; and
• that this Agreement becomes effective, enforceable and irrevocable on the
eighth calendar day following Employee’s execution of this Agreement provided
that Employee does not revoke the Agreement.
9. Release of Known and Unknown Claims by the Company. In exchange for the
agreements and promises set forth herein, the Company agrees unconditionally and
forever to release and discharge Employee from any and all claims, actions,
causes of action, demands, rights, or damages of any kind or nature which it may
now have, or ever had, whether known or unknown, including, but not limited to,
any claims, causes of action or demands of any nature arising out of or in any
way relating to Employee’s employment with, or separation from the Company on or
before the date of the execution of this Agreement. This release specifically
includes, but is not limited to, any claims for fraud; breach of contract;
breach of implied covenant of good faith and fair dealing; inducement of breach;
interference with contract; assault and battery; invasion of privacy;
intentional or negligent infliction of emotional distress; intentional or
negligent misrepresentation; conspiracy; or any other wrongful conduct, based
upon events occurring prior to the date of execution of this Agreement.
The Company further agrees knowingly to waive the provisions and protections of
Section 1542 of the California Civil Code, which reads:
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.

 

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The parties intend this release by the Company to be a full and comprehensive
general release waiving and releasing all claims, demands, and causes of action,
known or unknown, to the fullest extent permitted by law. Nothing in this
Agreement is intended to nor shall it be interpreted to release any claim which,
by law, may not be released.
10. No Admission of Liability. By entering into this Agreement, neither the
Company nor Employee suggests or admits to any liability to one another (except
for the covenants herein) or that they violated any law or any duty or
obligation to one another or to any other person or entity.
11. Confidentiality. Employee represents, warrants and agrees that neither he
nor any of his agents or representatives either has already disclosed or
publicized nor will at any time in the future disclose or publicize, or cause or
permit to be disclosed or publicized, the existence of this Agreement, any of
the terms of this Agreement, or the facts underlying this Agreement, to any
person, corporation, association or governmental agency or other entity except:
(1) to the extent necessary to report income to appropriate taxing authorities;
(2) to members of Employee’s immediate family; (3) in response to an order of a
court of competent jurisdiction or subpoena issued under the authority thereof;
(4) in response to any inquiry or subpoena issued by a state or federal
governmental agency; provided, however, that notice of receipt of such judicial
order or subpoena shall be immediately communicated by Employee to the Company
telephonically, and confirmed immediately thereafter in writing, so that the
Company will have the opportunity to assert what rights it has to non-disclosure
prior to Employee’s response to the order, inquiry or subpoena; (5) as needed to
enforce the Agreement; (6) as needed in any action or proceeding between the
Company and Employee; (7) to his attorneys, accountants and tax advisors; and
(8) as may otherwise be required by law. However, notwithstanding the provisions
of Paragraph 11, hereof, Employee may, without breaching this Agreement, respond
to inquiries by stating that his situation with the Company has been “resolved.”
Employee further represents, warrants and agrees that he has to date maintained
and will continue to maintain all non-public information regarding the
Releasees, or any of them, as strictly confidential and has not disclosed and
shall not disclose such information to any person or entity or cause such
information to be disclosed to any person or entity, either directly or
indirectly, specifically or generally.
12. Cooperation. Employee agrees to consult with the Company regarding on-going
matters that commenced during Employee’s employment with the Company and, within
reasonable limits, to cooperate with the Company in connection with disputes
between the Company and third parties (including, but not limited to, current or
former employees) when requested by the Company. This cooperation may include,
but is not limited to, conferring with and assisting the Company in preparatory
work in litigation matters, providing factual information to the Company, and
giving depositions and testimony in judicial and administrative proceedings.
Employee agrees that he will not be paid by the Company for his cooperation,
except that the Company will reimburse Employee for his reasonable out-of-pocket
expenses incurred in connection therewith, provided that such expenses are
approved in advance by the Company.
13. No Disparagement. Employee represents, warrants and agrees that on and after
the date Employee signs this Agreement he has not disparaged or made derogatory
or negative comments nor will he at any time in the future disparage or make
derogatory or negative comments to any third party (including but not limited to
employees of the Company) concerning the Releasees, or any of them at any time.
Nothing in this Section shall preclude Employee from testifying truthfully in
any deposition or judicial or administrative proceeding. Moreover, nothing in
this Section applies to communications to Employee’s immediate family or
communications to his attorneys, or to pleadings or other documents in any
proceeding to enforce this Agreement, or in any judicial, administrative or
arbitral proceedings where such information is relevant or discoverable.

 

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14. Return of Property. By signing below, Employee represents and warrants that
he has returned to the Company all of the Company’s property, documents (hard
copy or electronic files), and information prior to signing this Agreement, he
has not nor will he copy or transfer any Company information, nor will he
maintain any Company information after the Termination Date.
15. Non-Solicitation of Employees. Employee agrees that he will not, either
alone or jointly with any other person or entity, whether as principal, partner,
agent, shareholder, director, employee, consultant or otherwise, at any time
during a period of one (1) year following the Termination Date, directly or
indirectly solicit the employment or engagement of any person who is, at the
time of the solicitation, employed by the Company or any affiliated entity in
any capacity, whether or not such person would commit any breach of his or her
contract of employment by reason of his or her leaving the service of the
Company or any affiliated entity.
16. Assignment. The Company may assign this Agreement and/or any of its rights
or privileges hereunder, in one or more assignments, and this Agreement shall
inure to the benefit of all such successors and assigns.
17. Governing Law. This Agreement shall be governed by the laws of the State of
California as applied to agreements made and wholly to be performed in
California. This Agreement shall be enforceable in the Los Angeles County
Superior Court pursuant to California Code of Civil Procedure Section 664.6. The
prevailing party in any action to enforce the terms of this Agreement shall be
entitled to reasonable attorneys’ fees and costs incurred in connection with the
enforcement of the Agreement.
18. Entire Agreement. This Agreement constitutes the entire understanding
between the parties with respect to its subject matter, superseding all prior
agreements and understandings, written or oral, with respect to its subject
matter; provided, however that this agreement shall not be deemed to supersede
the Company’s Code of Conduct and/or any agreements between the Company and
Employee with respect to the protection of the Company’s confidential,
proprietary and/or trade secret information all of which survives. This
Agreement may not be amended or modified, nor any provision hereof waived, other
than by a writing signed by Employee and an authorized representative of the
Company.
19. Ambiguities. The general rule that ambiguities are to be construed against
the drafter shall not apply to this Agreement. In the event that any language of
this Agreement is found to be ambiguous, all parties shall have the opportunity
to present evidence as to the actual intent of the parties with respect to any
such ambiguous language.
20. Severability. If any sentence, phrase, paragraph, subparagraph or portion of
this Agreement is found to be illegal or unenforceable, such action shall not
affect the validity or enforceability of the remaining sentences, phrases,
paragraphs, subparagraphs or portions of this Agreement.
21. Each of the parties hereto warrants and represents to the other that they
have not previously assigned or transferred any of the claims released herein.

 

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22. Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original, all of which together shall
constitute one and the same instrument. Facsimile or pdf copy of this Agreement
(or facsimile or pdf signature) shall be deemed an original.
PLEASE READ CAREFULLY. THIS AGREEMENT CONTAINS A RELEASE OF ALL KNOWN AND
UNKNOWN CLAIMS.
THE UNDERSIGNED AGREE TO THE TERMS OF THIS AGREEMENT AND VOLUNTARILY ENTER INTO
IT WITH THE INTENT TO BE BOUND THEREBY.

          Dated: June 11, 2009  /s/ DAVID BORSHELL       David Borshell         
Dated: June 11, 2009  Image Entertainment, Inc.             /s/ JEFF M. FRAMER  
    By: Jeff M. Framer      Title:  President   

 

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