and the Consulting Agreement attached as Exhibit B are adequate consideration for (i) theagreements he makes in this Agreement, and (ii) the releases he gives pursuant to this Agreement.     (c) No Other Payments or Benefits. Executive shall not be eligible for, and he willnot receive, any payments or benefits from the Company, or under any plan, agreement, orarrangement in which Executive or the Company are a party or participate which are not expresslyset forth in this Agreement.**2.****Payments and Benefits Following Executive’s Resignation Date****.**     (a) General Conditions. The Company shall provide to Executive the payments andbenefits described in Exhibit A to this Agreement and under the Consulting Agreement whenrequired by Exhibit A and the Consulting Agreement, respectively. This Agreement shallbecome effective as of September 25, 2008 (the “Effective Date”).     (b) Taxes. Executive is solely responsible for paying any and all taxes he owes onamounts he receives or that are paid on his behalf under the terms of this Agreement. Thepreceding provision does not, and shall not be construed to make Executive responsible for taxesthat are imposed on any person or entity other than himself. The Company will withhold all taxesthat it determines are legally required to be withheld.**3.****Cooperation****.**     (a) Transition. Executive shall cooperate with the Company in ensuring an orderlytransition of matters handled by Executive. Executive shall sign any documents and do anythingthat is reasonably necessary in the future to implement his agreements in this Agreement.     (b) Cooperation as a Witness. Executive shall cooperate with the Company as a witnessin all matters about which he has knowledge as a result of his prior positions with the Company ifthe Company requests his testimony. To the extent practicable and within the control of theCompany, the Company will use reasonable efforts to schedule the timing of his participation in anysuch witness activities in a reasonable manner to take into account his then-current employment,and will pay the reasonable documented out-of-pocket expenses that the Company pre-approves andthat Executive incurs for travel required by the Company with respect to those activities.**4.****General Release of Claims by Executive****.**     (a) Release. As a material inducement for the Company to enter into this Agreement,Executive hereby forever, irrevocably and unconditionally, releases and discharges the Company andother Released Parties (as defined below) from any and all charges, claims, liabilities,agreements, damages, causes of action, suits, costs, losses, debts and expenses (includingattorneys’ fees and costs actually incurred) of any nature whatsoever, known or unknown, which henow has, or claims to have, or which Executive at any time had, or claimed to have, or whichExecutive at any time hereafter may have, or claim to have, against the Company, in each case asto acts or omissions occurring up to and including the date Executive signs his Agreement,including, without limitation, any claim of breach of fiduciary duty, rights arising out of allegedviolations of any contracts, express or implied, any covenant of good faith and fair dealing,
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express or implied, or any tort, or any legal restrictions on the Company’s right to terminateemployees, or any federal, state or other governmental statute, regulation, or ordinance, exceptany claims Executive may have under the Age Discrimination in Employment Act (all such mattershereby released, collectively referred to as “Claims”).**CIVIL CODE SECTION 1542 WAIVER.**As a further consideration and inducement for this Agreement,Executive hereby waives any and all rights under Section 1542 of the California Civil Code or anysimilar state, local, or federal law, statute, rule, order or regulation which the Employee mayhave. Section 1542 provides:“A general release does not extend to claims which the creditor does not know or suspect to existin his favor at the time of executing the release, which if known by him must have materiallyaffected his settlement with the debtor.”The parties expressly agree that the release in Subsection (a) shall extend and apply to allunknown, unsuspected and unanticipated injuries and damages as well as those that are nowdisclosed.This release will not apply to any claim for payments or benefits Executive may have under theterms of this Agreement or the Consulting Agreement, any indemnification or executive insuranceprotection rights or benefits that he may have, now or in the future, with regard to his activitieson or before his Resignation Date as an employee, officer, director or committee member for eitherof the Company or any Released Party, unpaid claims for benefits, if any, that are payable underthe Company’s group health plan.     (b) Released Parties. As used in this Agreement, the “Released Parties” arethe Company and all of its related companies, partnerships or joint ventures, including but notlimited to, direct and indirect parent and subsidiary companies, and their predecessors andsuccessors; and, with regard to each of those entities, except for Executive, all of its past andpresent employees, officers, directors, stockholders, owners, representatives, assigns, attorneys,agents, insurers, employee benefit programs (and the trustees, administrators, fiduciaries andinsurers of these programs) and any other persons acting by, through, under or in concert with anyof the persons or entities listed in this subsection. Executive understands that this releasecovers him and anyone who might have a claim through him or because of him, such as a past, currentor future spouse, his family, heirs, executors, representatives, agents and their successors andassigns.     (c) No Lawsuits. Executive has not filed or caused to be filed any lawsuit, complaintor charge with respect to any Claim he is releasing in this Agreement. Executive agrees never toinstitute, or participate in any action against any of the Releasees with respect to any Claimreleased by this Agreement, except as required by subpoena, court order, or other compulsoryprocess and except that he may participate in an investigation or proceeding conducted by an agencyof the United States government or of any state. Executive has not assigned or transferred anyClaim he is releasing, nor has he purported to do so. Notwithstanding any language herein to thecontrary, Executive understands that nothing in this Release prohibits Executive from filing orpursuing a charge of discrimination with the Equal Employment Opportunity Commission (“EEOC”) or aclaim with the National Labor Relations Board (“NLRB”); provided that, by signing this Agreement,Executive agrees to waive and relinquish any personal or monetary gain that would otherwise resultfrom such EEOC or NLRB claim.
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**5.****Release of Claims by the Company****.**     (a) The Company’s Release of Claims. The Company hereby irrevocably releases anddischarges Executive from any and all charges, claims, liabilities, agreements, damages, causes ofaction, suits, costs, losses, debts and expenses (including attorneys’ fees and costs actuallyincurred) of any nature whatsoever, known or unknown, which the Company now has, or claims to have,or which the Company at any time had, or claimed to have, or which the Company at any timehereinafter may have, or claim to have, against Executive, in each case as to acts or omissions byExecutive occurring up to the Resignation Date, except for any claim based on breach of fiduciaryduty, duty of loyalty or duty of care, or fraud, theft or intentional misconduct, or any act thatis determined to be a criminal act under any law (the “Company’s Claims”).     (b) No Lawsuits by the Company. The Company has not filed or caused to be filed anylawsuit, complaint or charge with respect to any Company’s Claims it is releasing in thisAgreement. The Company agrees never to institute, pursue, or participate in any action againstExecutive with respect to any Company’s Claims released by this Agreement, except as required bysubpoena, court order or other compulsory process and except that the Company may participate in aninvestigation or proceeding conducted by an agency of the United States Government or of any state.The Company has not assigned or transferred any Company’s Claim it is releasing, nor has itpurported to do so.**6.****Miscellaneous Provisions****.**     (a) Binding Agreement. This Agreement is final and binding. Executive has carefullyread and fully understands all of the provisions of this Agreement.     (b) Entire Agreement. This Agreement and the attached Exhibits form the entireagreement between the Company and Executive and supersede all other agreements, understandings,plans or arrangements relating to the subject matter hereof, except that (1) the provisions ofSections 14, 15, and 16 of the Employment Agreement shall survive Executive’s termination ofemployment pursuant to Section 16.8 thereof, and (2) this Agreement does not supersede or affectthe Confidentiality and Assignment of Creative Works Agreement between XLNT and Executive datedNovember 9, 2007 or the Consulting Agreement. Executive acknowledges that the Company has made norepresentations or promises to Executive, written or oral, other than those in this Agreement.     (c) Amendment. This Agreement may not be modified, amended, supplemented orterminated except by a written instrument executed by the parties hereto.     (d) Assignment. The rights and obligations of the Company under this Agreement shallinure to the benefit of the Company’s successors and assigns. This Agreement may be assigned by theCompany to an affiliate, to any legal successor to all or a portion of the business of the Companyor an affiliate, or to an entity which purchases assets from either of the Company or an affiliate.In the event the Company assigns this Agreement as permitted by this Agreement, “the Company” asdefined herein will refer to the assignee. Executive may not assign this Agreement.
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     (e) Waiver. The waiver by the Company of any breach of this Agreement by any partyshall not be effective unless in writing, and no such waiver shall constitute the waiver of thesame or another breach on a subsequent occasion.     (f) Governing Law and Jurisdiction. This Agreement will be governed by and construedin accordance with California law.     (g) Interpretation. Captions and section and subsection headings used herein areprovided for convenience only and are not part of this Agreement and shall not be used inconstruing it. Executive acknowledges that this Agreement is not an admission of guilt orwrongdoing by the Company.     (h) Blue Penciling. If any court or arbitrator determines that any of the provisionscontained in this Agreement, or any part of it, are unenforceable because of the length of anyperiod of time, the size of any area or the scope of activities contained in those provision(s),then that period of time, area or scope will be considered to be adjusted to a period of time, areaor scope which would cure that invalidity, and those provisions in their revised form will then beenforced to the maximum extent permitted by applicable law.     (i) Severability. Each of the covenants and agreements hereinabove contained shall bedeemed separate, severable and independent covenants, and in the event that any covenant shall bedeclared invalid by any court of competent jurisdiction, such invalidity shall not in any manneraffect or impair the validity or enforceability of any other part or provision of such covenant orof any other covenant contained herein.     (j) Expenses. The Company agrees to reimburse Executive for actual out of pocketlegal expenses (not to exceed $5,000.00) incurred by Executive in connection with the review ofthis Agreement and any related matters.     (j) Counterparts. This Agreement may be signed in counterparts, and the signedcounterparts will form a single agreement.[Signature Page Follows]
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**7.****Notice and Acknowledgement****.**     Executive acknowledges that, before signing this Agreement, he was given a reasonable periodof time in which to consider this Agreement. Executive understands this Agreement and is enteringinto it voluntarily without coercion or duress of any kind. Executive further acknowledges thatthe Company has encouraged and does encourage him to discuss this Agreement with an attorney beforesigning it and that Executive did so to the extent he deemed appropriate.      PET DRX CORPORATION