puredepth_ex1021.htm


     

    Exhibit
      10.21

     

    
      CONFIDENTIAL
        SEPARATION AGREEMENT

      AND
        GENERAL RELEASE OF CLAIMS

       

      1.           Fred
        Angelopoulos (“Employee”) was employed by PureDepth, Inc. (the “Company”) as
        Chief Executive Officer pursuant to an Executive Employment Agreement effective
        November 10, 2006 (the “Employment Agreement”).  The Company and
        Employee have mutually agreed to terminate the employment
        relationship.  Employee was also co-employed by Administaff, pursuant
        to an Administaff employment agreement; Employee agrees that Employee’s
        employment with Administaff will terminate under such agreement in conjunction
        with Employee’s termination of employment with the Company.  Employee
        also will resign from the Board of Directors of the Company, and its
        subsidiaries.  It is the Company’s desire to provide Employee with
        certain benefits upon his termination of employment and to resolve any claims
        that Employee has or may have against the Company.

       

      2.           Employee
        hereby voluntarily resigns from his employment with the Company, in his capacity
        as Chief Executive Officer, and also resigns as a member of the Board of
        Directors of the Company (and its subsidiaries), and the Company and Board
        of
        Directors hereby accepts such voluntary resignations effective June 26, 2007
        (the “Termination Date”).  Employee and the Company agree that as of
        Termination Date, they are terminating the Employment Agreement, other than
        the
        Surviving Terms (as defined below).  In so doing, Employee and the
        Company specifically acknowledge and agree that both parties have waived
        any
        obligations with respect to payments to be made to Employee which may otherwise
        have been required under the Employment Agreement and that the consideration
        to
        be paid to Employee by the Company pursuant to this Agreement will supersede
        the
        obligations of the Company under the Employment Agreement.

       

      3.           Employee
        represents and agrees that, except as expressly provided below, he has received
        all compensation owed to him by the Company through the Termination Date,
        including any and all wages, commissions, bonuses, incentives, stock options,
        earned but unused vacation, severance benefits and any other compensation
        of any
        kind to which he was or may have been entitled in connection with his employment
        with the Company.

      


      4.           With
        respect to outstanding business expenses, if any, Employee agrees that on
        or
        before July 20, 2007, he will submit a final expense reimbursement statement
        reflecting any outstanding business expenses incurred through the Termination
        Date, along with the appropriate receipts and necessary supporting
        documentation.  The Company will provide reimbursement for appropriate
        and reasonable business expenses in accordance with its current business
        policies and practices, and for only expenses incurred prior to the Termination
        Date.  Payment shall be made at the time described in Section 6 of the
        Employment Agreement.

      


      5.           Employee
        represents to the Company that he is signing this Separation Agreement and
        General Release (the “Separation Agreement”) voluntarily and with a full
        understanding of and agreement with its terms for the purpose of receiving
        additional pay and consideration from the Company beyond that which is owed
        to
        him.

      


      6.           The
        Company shall provide Employee with the following benefits after this Separation
        Agreement becomes effective (as defined below):

       

      
        
           

        

        
          1

          
            

          

        

        
           

        

      

      (a)           Employee
        will be retained as a consultant for a period commencing on the Effective
        Date
        and continuing through September 26, 2007 (the “Consulting Period”), to render
        such services as the Company may reasonably request from time to time on
        areas
        within Employee’s expertise, and agrees to assist with any transition matters
        (including without limitation assistance in preparation, execution or filings
        of
        any required regulatory filings, standard corporate governance documents
        such as
        Board of Director minutes or actions, etc. or other matters as reasonably
        requested by the Company).  Employee will maintain the confidentiality
        of any Company confidential information received during such period and agrees
        to sign and return a confidentiality agreement, substantially in the form
        attached to this Separation Agreement, providing for such confidential
        information (“NDA”).  Employee will not be required to come to the
        Company’s office on a daily basis, but agrees to use his best efforts to respond
        to any reasonable Company request on a reasonable and timely
        basis.  As compensation for the consulting services to be rendered by
        Employee during such the Consulting Period, the Company shall pay Employee
        a
        monthly consulting fee (paid twice monthly) equal to the monthly salary amount
        Employee earned immediately prior to the Termination Date (“Salary Rate”),
        subject to standard deductions.

       

      (b)           After
        the Consulting Period, Employee will no longer be retained as a consultant,
        but
        he will receive salary continuation, subject to his compliance with the terms
        herein, in the NDA and/or the Surviving Terms (as defined below), in a monthly
        amount equal to the Salary Rate, to be paid twice monthly, for an additional
        twelve (12) month period.  During such twelve (12) month period,
        Employee shall not be required to provide consulting services to the Company,
        but shall remain subject to the terms contained herein, and in the NDA and/or
        the Surviving Terms (as defined below).

       

      In
        the
        event that Employee elects to provide any services, directly or indirectly,
        to
        any competitor of the Company (as reasonably determined by the Company’s Board
        of Directors in its sole discretion) during the fifteen (15) month period,
        referenced in (a) and (b) above, whether as an employee, consultant, advisor,
        investor, or otherwise, Employee shall provide the Company advance written
        notice, and Employee acknowledges and agrees that the Company shall be released
        from its obligations to make any further payments to Employee
        hereunder.  In addition, during the fifteen (15) month period,
        Employee agrees to vote any shares of the Company’s securities held beneficially
        by Employee (or to execute a consent pursuant to an action by a written consent
        of the Company’s shareholders with respect to such securities) in favor of any
        action approved by the Board of Directors of the Company from time to time
        and
        submitted to the stockholders of the Company for approval.  Should the
        foregoing provision be construed to constitute the granting of a voting proxy,
        such proxy shall be deemed to be coupled with an interest and is irrevocable
        for
        the term thereof.

       

      (c)           Employee
        is covered under the Company’s group health plan as of the Termination Date and
        provided he timely elects to continue his group coverage pursuant to
        federal/state law (COBRA), the Company will pay twenty (24) months of the
        applicable COBRA premiums as COBRA is provided in accordance with the terms
        of
        the applicable plans and the law.  At the earlier of (i) such time as
        Employee is employed by another employer, or (ii) the end of the 24-month
        period, Employee will be solely responsible for the timely payment of the
        COBRA
        premiums; in the event that COBRA coverage is not offered for that length
        of
        term, the Company will pay for and maintain health insurance coverage for
        Employee and his immediate family for a period of twenty-four (24) months
        from
        July 1, 2007; and

       

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

      (d)           the
        Company agrees that it will not contest Employee’s claim for unemployment
        benefits that may be filed by Employee after the Termination Date unless
        such
        claim is falsely filed.

       

      (e)           Employee
        has an outstanding option  (the “Option”) to purchase common stock of
        the Company pursuant to a Stock Option Agreement, as amended pursuant to
        an
        Amendment of Stock Option Agreement dated December 2006 (the
“Amendment”).  Company and Employee hereby agree that the terms of the
        Option are further amended, effective as of immediately prior to the Termination
        Date, as set forth below:

       

      (i)           The
        first sentence of Section 2 of the Amendment is hereby revised to read:
“Notwithstanding the termination date in the Option Agreement, the Option
        may be
        exercised only in the calendar years indicated on Schedule A.”

       

      (ii)           The
        Note on Schedule A is hereby deleted in its entirety.

       

      (iii)           Schedule
        B is revised to read as follows:

       

      Schedule
        B

      Selling
        Schedule

       

      2006                                 
        100,000 Shares

      2007                                 
        600,000 Shares

      2008                                
         870,000 Shares

      2009                               1,430,000
        Shares

       

      Employee
        acknowledges that to the extent such Options are exercised, they will be
        treated
        for tax purposes as nonqualified stock options and that the Company shall
        be
        entitled to withhold from amounts otherwise due to Employee any taxes required
        to be withheld upon any such exercise.

       

      (f)           In
        the event that the Company consummates a private placement of the Company’s
        securities any time prior to December 31, 2007, in which existing stockholders
        of the Company are invited to participate by; selling shares of their common
        stock therein, Employee will be eligible to participate in such transaction
        such
        that he will be invited to sell a number of shares of common stock in an
        amount
        of no less than 200,000 shares and no more than 300,000 shares; provided
        however, that if existing stockholders indicate an interest to include in
        such
        offering for sale a greater aggregate number of their shares of common stock
        than in the reasonable opinion of the managing underwriter of the proposed
        offering, or the investment banker engaged to manage the offering, can be
        accommodated without adversely affecting the proposed offering, then the
        amount
        of shares that may be offered by Employee for offering, as well as the number
        of
        securities of any other selling stockholders participating in the registration,
        shall not be included or shall be proportionally reduced to a number deemed
        satisfactory by such managing underwriter or investment bank.  The
        Company’s obligations in this subsection (f) shall be contingent upon your full
        and timely cooperation in connection with such offering, including without
        limitation your provision of any information and/or execution and compliance
        with agreements that are standard and/or necessary for the Company to finalize
        the offering, to be determined in the sole and exclusive discretion of the
        Company.

       

      
        
           

        

        
          3

          
            

          

        

        
           

        

      

      7.           Employee
        and his successors and assigns release the Company, and Administaff, and
        their
        related entities, past and present affiliates, shareholders, investors,
        directors, officers, employees, agents, attorneys, insurers, legal successors
        and assigns (the “Released Parties”) of and from any and all claims, actions and
        causes of action, whether now known or unknown, which Employee now has, or
        at
        any other time had, or shall or may have against those Released Parties based
        upon or arising out of any matter, cause, fact, thing, act or omission
        whatsoever occurring or existing at any time up to and including the Termination
        Date, including, but not limited to, any claims of breach of contract, wrongful
        termination, retaliation, fraud, defamation, infliction of emotional distress
        or
        national origin, race, age, sex, sexual orientation, disability or other
        discrimination or harassment under the Civil Rights Act of 1964, the Age
        Discrimination In Employment Act of 1967, as amended, the Older Workers Benefit
        Protection Act, the Americans with Disabilities Act, the Fair Employment
        and
        Housing Act or any other applicable law.  However, this Release is not
        intended to bar any claims that, by statute, may not be waived, such as claims
        for workers’ compensation benefits, unemployment insurance benefits, and any
        challenges to the validity of Employee’s release of claims under the Age
        Discrimination in Employment Act of 1967, as amended, as set forth in this
        Agreement.

       

      8.           Employee
        acknowledges that he has read section 1542 of the Civil Code of the State
        of
        California, which states in full:

       

      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.

       

      Employee
        waives any right which he has or may have under section 1542 to the full
        extent
        that he may lawfully waive such rights pertaining to this general release
        of
        claims.

       

      9.           This
        Agreement is intended to satisfy the requirements of the Older Workers’ Benefit
        Protection Act, 29 U.S.C. sec. 626(f).  Employee, by this Agreement,
        is advised to consult with an attorney before executing this
        Agreement.

       

      Employee
        acknowledges and agrees that
        (a) Employee has read and understands the terms of this Agreement;
        (b) Employee has been advised in writing to consult with an attorney before
        executing this Agreement; (c) that Employee has obtained and considered
        such legal counsel as Employee deems necessary; (d) that Employee has been
        given up to twenty-one (21) days to consider whether or not to enter into
        this
        Agreement (although Employee may elect not to use the full 21 -day period
        at
        Employee’s option); and (e) that by signing this Agreement, Employee
        acknowledges that Employee does so freely, knowingly, and
        voluntarily.

       

      This
        Agreement shall not become effective or enforceable until the eighth day
        after
        Employee signs this Agreement (the “Effective Date”).  In other words,
        Employee may revoke Employee’s acceptance of this Agreement within seven (7)
        days after the date Employee signs it.  Employee’s revocation must be
        in writing and received by Mary LaVigne-Butler, at the law offices of DLA
        Piper,
        2000 University Avenue, East Palo Alto, California 94303, by 5:00 p.m. Pacific
        Time on the seventh day in order to be effective.  If Employee does
        not revoke acceptance within the seven (7) day period, Employee’s acceptance of
        this Agreement shall become binding and enforceable on the Effective
        Date.  The benefits described above shall become due and payable in
        accordance with paragraph 6, provided this Agreement has not been
        revoked.

       

      
        
           

        

        
          4

          
            

          

        

        
           

        

      

      This
        Agreement does not waive or
        release any rights or claims that Employee may have under the Age Discrimination
        in Employment Act that arise after the execution of this
        Agreement.  In addition, this Agreement does not prohibit Employee
        from challenging the validity of this Agreement’s waiver and release of claims
        under the Age Discrimination in Employment Act of 1967, as amended.

       

      10.           Employee
        acknowledges and agrees that he shall continue to be bound by and comply
        with
        the terms of any proprietary rights, non-disclosure, confidentiality, and/or
        non-interference with business relations agreements between the Company and
        Employee, including without limitation the provisions in Sections 9 and 10
        set
        forth in the Employment Agreement (the “Surviving Terms”).  On or
        before the Termination Date, Employee will return to the Company, in good
        working condition, all Company property and equipment that is in Employee’s
        possession or control, including, but not limited to, any files, records,
        computers, computer equipment, cell phones, credit cards, keys, programs,
        manuals, business plans, financial records, and all documents (and any copies
        thereof) that Employee prepared or received in the course of he employment
        with
        the Company.

       

      11.           Employee
        agrees that he shall not directly or indirectly disclose any of the terms
        of
        this Agreement to anyone other than his immediate family or counsel, except
        as
        such disclosure may be required for accounting or tax reporting purposes
        or as
        otherwise may be required by law.  Employee further agrees that he
        will not, at any time in the future, make any critical or disparaging statements
        about the Company, its products, services or its directors, officers and/or
        employees, unless such statements are made truthfully in response to a subpoena
        or other legal process.  Employee also agrees that he will defer all
        inquiries relating to the Company, its products, services, directors, officers
        and/or employees, or relating to his termination, including without limitation,
        inquiries from stockholders, analysts, prospective investors, customers,
        vendors, suppliers or other business partners or parties, to the Chief Financial
        Officer of the Company, and further that he will not contact, by phone, email
        or
        otherwise, any such parties, unless specifically requested in each instance
        by
        the Company.

       

      12.           Employee
        agrees that for a period of one (1) year following the Termination Date,
        he will
        not, on behalf of himself or any other person or entity, directly or indirectly
        solicit any employee of the Company to terminate his employment with the
        Company.

       

      13.           In
        the event of any legal action relating to or arising out of this Agreement,
        the
        prevailing party shall be entitled to recover from the losing party its
        attorneys’ fees and costs incurred in that action.

       

      
        
           

        

        
          5

          
            

          

        

        
           

        

      

      14.           Employee
        and the Company understand and acknowledge that this Agreement constitutes
        a
        compromise and settlement of disputed claims.  No action taken by the
        parties hereto, or either of them, either previously or in connection with
        this
        Agreement, shall be deemed or construed to be (a) an admission of truth or
        falsity of any claims heretofore made or (b) an acknowledgement or
        admission by either Party of any fault or liability whatsoever to the other
        party or to any third party.

       

      15.           Each
        party represents that it has been advised of its right to consult with an
        attorney and to seek legal representation of its choosing in the execution
        of
        this Agreement, and has carefully read and understands the scope and effect
        of
        the provisions of this Agreement.  Neither party has relied upon any
        representations or statements made by the other party hereto which are not
        specifically set forth in this Agreement.

       

      16.           This
        Agreement constitutes the entire agreement between the parties with respect
        to
        the subject matter hereof and supersedes all prior negotiations and agreements,
        whether written or oral, with the exception of any agreements described in
        paragraph 7 and the Option Agreement.  This Agreement may be
        modified or amended only with the written consent of Employee and an authorized
        officer of the Company, provided, however, that the Company may amend or
        modify
        this Agreement in order to comply with the provisions of, or to be exempt
        from
        the application of, Section 409A of the Internal Revenue Code, to the
        extent applicable.  Notwithstanding the preceding sentence, the
        Company will have no obligation to amend or modify this Agreement to provide
        that any payment or benefit hereunder will comply with, or be exempt from,
        Section 409A, and the Company makes no representation or warranty regarding
        compliance with, or exemption from, Section 409A with respect to any payment
        or
        benefit provided by this Agreement.  Employee agrees that Employee
        shall bear sole and exclusive responsibility for any and all federal, state,
        local and/or foreign tax consequences (including, without limitation, any
        and
        all tax liability under Section 409A) of this Agreement, and fully indemnifies
        and holds the Company harmless therefor.  Employee should consult with
        his own tax advisor in connection with this Agreement and its tax
        consequences.  No oral waiver, amendment or modification will be
        effective under any circumstances whatsoever.

       

      EMPLOYEE
        UNDERSTANDS THAT HE SHOULD CONSULT WITH AN ATTORNEY PRIOR TO SIGNING THIS
        AGREEMENT AND THAT HE IS GIVING UP ANY LEGAL CLAIMS HE HAS AGAINST THE PARTIES
        RELEASED ABOVE BY SIGNING THIS AGREEMENT.  EMPLOYEE ACKNOWLEDGES THAT
        HE IS SIGNING THIS AGREEMENT KNOWINGLY, WILLINGLY AND VOLUNTARILY IN EXCHANGE
        FOR THE BENEFITS DESCRIBED IN PARAGRAPH 6.

       

       

      
        	Dated:__________________,
                2007  	 	 	 	 
	
              	 	 	
                Fred
                  Angelopolous

              	 


      

      


      
        	 	 	 	 	 	 
	 	 	 	PUREDEPTH,
                INC.	 
	 	 	 	 	 	 
	Dated:__________________,
                2007  	 	 	By:	 	 
	
                 

              	 	 	
                Its:

              	 	 


      

      


             

      6