{"id":39923,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/executive-severance-agreement-navarre-corp.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"executive-severance-agreement-navarre-corp","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/compensation\/executive-severance-agreement-navarre-corp.html","title":{"rendered":"Executive Severance Agreement – Navarre Corp."},"content":{"rendered":"

EXECUTIVE SEVERANCE AGREEMENT <\/strong><\/p>\n

THIS EXECUTIVE SEVERANCE AGREEMENT<\/strong> (the
\n“Agreement<\/strong>“), dated as of the 31st day of March, 2008 (the
\n“Effective Date<\/strong>“), is entered into by and between
\nNAVARRE CORPORATION<\/strong>, a Minnesota corporation, (the
\n“Company<\/strong>“), and DIANE LAPP<\/strong>, an individual
\nresiding in the State of Minnesota (the “Executive<\/strong>“).<\/p>\n

WHEREAS<\/strong>, Executive holds the key position of Vice President
\nFinance and is considered an integral part of Company153s management;<\/p>\n

WHEREAS<\/strong>, the Company desires to promote the stability of the
\nCompany by providing the Executive with appropriate assurances with respect to
\ncertain events that result in the Executive153s involuntary termination as
\ndescribed more fully herein; and<\/p>\n

WHEREAS<\/strong>, the Board of Directors of the Company (the
\n“Board<\/strong>“) has determined that this Agreement is in the best
\ninterests of the Company and its shareholders in order to secure Executive153s
\ncontinued services.<\/p>\n

NOW, THEREFORE<\/strong>, in consideration of the above recitals and
\nthe mutual promises contained in the Agreement, it hereby agreed by and between
\nthe parties as follows:<\/p>\n\n\n\n
\n

1.<\/p>\n<\/td>\n

\n

DEFINITIONS. <\/strong>For purposes of this Agreement the following
\ndefinitions apply:<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

a. “Base Salary<\/em><\/strong>“<\/em> means the Executive153s
\nannualized base salary as adjusted from time to time.<\/p>\n

b. “Cause<\/em><\/strong>” means a termination of Executive153s
\nemployment by the Company or its successor due to any of the following:<\/p>\n

(i) Executive153s conviction of, or the entering by Executive of a plea of
\nnolo contendere<\/em> to, any felony charge or to any non-felony crime
\ninvolving misrepresentation, fraud or moral turpitude;<\/p>\n

(ii) Executive153s gross neglect, willful malfeasance or willful misconduct in
\nconnection with her employment hereunder which has had or could have a material
\nadverse effect on the business or reputation of the Company and its
\nsubsidiaries, unless Executive reasonably believed in good faith that such act
\nor non-act was in the best interests of the Company;<\/p>\n

(iii) A substantial and continual refusal by Executive to perform Executive153s
\nassigned duties, responsibilities or obligations (provided that such duties,
\nresponsibilities or obligations are lawful and further provided that the failure
\nto perform is not due to incapacity caused by a disability) that continues for
\nthirty (30) days after receipt by Executive of written notice from the Company
\nidentifying the duties, responsibilities or obligations not being performed;\n<\/p>\n

(iv) A violation by Executive of any policy of the Company or its successor
\nthat is generally applicable to all employees or all officers of the Company or
\nits successor including, but not limited to, policies concerning insider trading
\nor sexual harassment, or the Company153s code of conduct, that Executive knows or
\nreasonably should know could reasonably be expected to result in a material
\nadverse effect on the Company or its successor, unless such violation is capable
\nof being cured and is not cured within thirty (30) days after receipt of notice
\nthereof from the Company;<\/p>\n

1<\/p>\n

\n

(v) Any fraudulent or dishonest action, or failure to act, with respect to
\nthe business or affairs of the Company or its successor or breach of the duty of
\nloyalty toward the Company or its successor, including, without limitation,
\nproviding false or misleading information to the Company or its successor;<\/p>\n

(vi) Executive153s failure to cooperate, if requested by the Board, with any
\ninvestigation or inquiry into her or the Company153s (or its successor153s) business
\npractices, whether internal or external, including, but not limited to
\nExecutive153s refusal to be deposed or to provide testimony at any trial or
\ninquiry; or<\/p>\n

(vii) Any material breach by Executive of the provisions of Paragraphs 4, 5,
\nor 6 of this Agreement, unless such violation is capable of being cured and is
\nnot cured within thirty (30) days after receipt of notice thereof from the
\nCompany.<\/p>\n

c. “Code<\/em><\/strong>” means the Internal Revenue Code of 1986,
\nas amended.<\/p>\n

d. “Good Reason<\/em><\/strong>” means a termination of Executive153s
\nemployment by the Executive for any of the following events, provided that
\nExecutive shall have delivered a written notice to the Company or its successor
\nwithin thirty (30) days of her having actual knowledge of the occurrence of one
\nof such events, stating that she intends to terminate her employment for Good
\nReason and specifying the factual basis for such termination, and such event
\nshall not have been cured by the Company or its successor within thirty (30)
\ndays of the receipt of such notice, and further provided that the termination of
\nExecutive153s employment occurs no later than six months (6) months following the
\ninitial existence of one of such events:<\/p>\n

(i) A material diminution in Executive153s Base Salary from that in effect as
\nof the Effective Date;<\/p>\n

(ii) A material diminution in Executive153s duties, responsibilities or
\nauthority from that in effect as of the Effective Date; or<\/p>\n

(iii) A material change in the geographic location of Executive153s principal
\nplace of employment from that in effect as of the Effective Date.<\/p>\n

e. “Severance Event<\/em><\/strong>” means either: (i) the
\neffective date of the termination of Executive153s employment by the Company for
\nany reason other than for Cause, or (ii) the effective date of the termination
\nof Executive153s employment for Good Reason. A Severance Event shall not include a
\ntermination of Executive153s employment as a result of Executive153s death. The term
\n“termination of employment” and other similar terms used in this Agreement shall
\nbe construed to have the same meaning as is given to the term “separation from
\nservice” in Section 409A of the Code.<\/p>\n\n\n\n
\n

2.<\/p>\n<\/td>\n

\n

TERM OF AGREEMENT. <\/strong>This Agreement shall be effective as of
\nthe Effective Date and shall continue through December 31, 2010. As of December
\n31, 2010, and on each December 31 thereafter, the Agreement shall automatically
\nbe extended for one additional year unless, not later than the preceding June
\n30, either party shall have given notice that such party does not wish to extend
\nthe Agreement term.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

2<\/p>\n

\n\n\n\n
\n

3.<\/p>\n<\/td>\n

\n

SEVERANCE PAYMENTS.<\/strong><\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

a. Upon the occurrence of a Severance Event, and in consideration of and
\ncontingent upon the execution and delivery by Executive of a mutually agreeable
\ngeneral release of all claims and expiration of any applicable revocation period
\nin connection therewith, Executive shall be entitled to a severance payment as
\nfollows:<\/p>\n

(i) Subject to Paragraph 3c below, an amount equal to Executive153s then
\ncurrent Base Salary; and<\/p>\n

(ii) In full substitution for Executive153s rights under the Company153s annual
\nincentive bonus plan, a substitute incentive award equal to the average amount
\nof the annual incentive award earned and paid to the Executive with respect to
\nthe preceding three (3) fiscal years.<\/p>\n

b. The severance payment shall be made in a lump sum within thirty (30) days
\nafter the effective date of the termination of employment.<\/p>\n

c. If applicable, the severance amount provided for in Paragraph 3a(i) above
\nwill be offset by any income protection benefits payable to Executive during the
\nfirst twelve months of a qualifying disability under the Company153s group
\nshort-term and long-term disability insurance plans.<\/p>\n

d. Notwithstanding the foregoing to the contrary, in no event shall the
\namount due and payable hereunder constitute a “Parachute Payment” within the
\nmeaning of the Section 280G(b)(2) of the Code. In the event that any portion of
\nthe severance payment would be deemed a Parachute Payment, the amount of the
\nseverance payment shall be reduced only to the extent necessary to eliminate any
\nsuch treatment or characterization.<\/p>\n

e. It is the intent of the parties that payments under this Agreement comply
\nwith Section 409A of the Code, and, accordingly, to interpret, to the maximum
\nextent permitted, this Agreement to be in compliance therewith. If the Executive
\nnotifies the Company in writing (with specificity as to the reason therefore)
\nthat the Executive believes that any provision of this Agreement (or of any
\npayment of compensation under this Agreement) would cause the Executive to incur
\nany additional tax or interest under Section 409A of the Code, and the Company
\nconcurs with such belief or the Company (without any obligation whatsoever to do
\nso) independently makes such determination, the parties shall, in good faith,
\nreform such provision to try to comply with Section 409A through good faith
\nmodifications to the minimum extent reasonably appropriate to conform with
\nSection 409A. To the extent that any provision hereof is modified by the parties
\nto try to comply with Section 409Aof the Code, such modification shall be made
\nin good faith and shall, to the maximum extent reasonably possible, maintain the
\noriginal intent of the applicable provision without violating the provisions of
\nSection 409A. Notwithstanding the foregoing, the Company shall not be required
\nto assume any economic burden in connection with compliance or noncompliance
\nwith Section 409A of the Code.<\/p>\n\n\n\n
\n

4.<\/p>\n<\/td>\n

\n

CONFIDENTIALITY.<\/strong><\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

a. Executive acknowledges that her position with Company will bring Executive
\nin close contact with many confidential affairs of the Company and its
\nsubsidiaries, including, but not limited to, information about costs, profits,
\nfinancial data, markets, trade secrets, sales, products, key personnel, pricing
\npolicies, customer lists, development projects, operational methods, technical
\nprocesses, plans<\/p>\n

3<\/p>\n

\n

for future development, business affairs and methods and other information
\nnot readily available to the public. In recognition of the foregoing, Executive
\ncovenants and agrees that:<\/p>\n

(i) Executive will keep secret all material confidential matters of the
\nCompany which are not otherwise in the public domain and will not disclose them
\nto anyone outside of the Company, either during or after the termination of her
\nEmployment, except with the Company153s written consent and except for such
\ndisclosure as is necessary in the performance of Executive153s duties or to the
\nextent required by an order of a court having competent jurisdiction or under
\nsubpoena from an appropriate government agency; and<\/p>\n

(ii) Executive will deliver promptly to the Company on termination of her
\nemployment with the Company, or at any other time the Company may so request,
\nall memoranda, notes, records, reports and other documents (and all copies
\nthereof) containing confidential material relating to the Company, which
\nExecutive may then possess or have under her control.<\/p>\n\n\n\n
\n

5.<\/p>\n<\/td>\n

\n

INTELLECTUAL PROPERTY.<\/strong><\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

a. All right, title, and interest in and to all inventions, patent
\napplications, patents thereon, know-how and trade secret information, and all
\ncopyrightable material, copyrights, and copyright applications (collectively,
\n“Intellectual Property”) that Executive conceives or originates, either
\nindividually or jointly with others, and which relate to the business of the
\nCompany, will be the sole and exclusive property of the Company, and Executive
\nhereby irrevocably assigns and conveys the sole and exclusive right, title and
\ninterest therein, free and clear of any liens or other encumbrances. Such
\nIntellectual Property shall include, but not be limited to, Intellectual
\nProperty that:<\/p>\n

(i) Is based on any confidential or proprietary information of the Company or
\nof any vendor, supplier or customer of the Company;<\/p>\n

(ii) Is related to the actual business of or research and development of the
\nCompany;<\/p>\n

(iii) Was developed with use of materials, employees, supplies or facilities
\nof the Company; or<\/p>\n

(iv) Was funded by the Company.<\/p>\n

b. Executive agrees to execute promptly any papers and perform promptly any
\nother reasonable acts necessary to assist the Company to perfect all rights,
\nincluding all Intellectual Property rights, reserved or conveyed thereto
\nhereunder. Executive agrees to render promptly aid and assistance to the Company
\nin any interference or litigation pertaining to such Intellectual Property, and
\nall reasonable expenses therefor incurred by Executive at the request of the
\nCompany will be borne by the Company.<\/p>\n

c. Executive will promptly disclose to the Company all Intellectual Property
\nconceived or originated pursuant to her employment.<\/p>\n

d. Executive warrants that in the event that Executive creates any original
\nmaterials or uses any proprietary information in rendering services, none of
\nsuch material shall infringe any copyrights, trade secrets, rights of privacy,
\nor any other rights of others.<\/p>\n

4<\/p>\n

\n\n\n\n
\n

6.<\/p>\n<\/td>\n

\n

NONSOLICITATION. <\/strong>Executive covenants and agrees that during
\nher employment with the Company and for a period of two (2) years thereafter she
\nwill not, directly or indirectly, as a principal, officer, director,
\nshareholder, partner, member, employee, consultant, independent contractor,
\nagent or executive or in any other capacity whatsoever, without the prior
\nwritten consent of the Company, solicit or attempt to solicit or encourage any
\nperson, who is then, or was within the then most recent 12-month period, to the
\nknowledge of Executive, an employee, agent, consultant or representative of the
\nCompany, to become an employee, agent, representative or consultant of or to
\nExecutive or any other individual or entity.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

7.<\/p>\n<\/td>\n

\n

ASSIGNMENT.<\/strong> This Agreement and all of the provisions hereof
\nwill be binding upon and inure to the benefit of the Company153s successors and
\nassigns. Neither this Agreement nor any of the rights, interests or obligations
\nhereunder may be assigned by Executive.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

8.<\/p>\n<\/td>\n

\n

SEVERABILITY.<\/strong> Whenever possible, each provision of this
\nAgreement will be interpreted in such manner as to be effective and valid under
\napplicable law, but if any provision of this Agreement is held to be prohibited
\nby or unenforceable or invalid under applicable law, such provision will be
\nineffective only to the extent of such prohibition or invalidity, without
\ninvalidating the remainder of such provision or the remaining provisions of this
\nAgreement. In furtherance and not in limitation of the foregoing, should the
\nduration or geographical extent of, or business activities covered by, any
\nprovision of this Agreement be in excess of that which is valid and enforceable
\nunder applicable law, then such provision shall be construed to cover only that
\nduration, extent or activities which may validly and enforceably be covered.
\nExecutive acknowledges the uncertainty of the law in this respect and expressly
\nstipulates that this Agreement be given the construction which renders its
\nprovisions valid and enforceable to the maximum extent (not exceeding its
\nexpress terms) possible under applicable law.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

9.<\/p>\n<\/td>\n

\n

COMPLETE AGREEMENT.<\/strong> This Agreement contains the complete
\nagreement between the parties with respect to the subject matter hereof and
\nsupersedes any prior understandings, agreements or representations by or between
\nthe parties, written or oral, which may have related to the subject matter
\nhereof in any way. No person, whether or not an officer, agent, employee or
\nrepresentative of any party, has made or has any authority to make for or on
\nbehalf of that party any agreement, representation, warranty, statement,
\npromise, arrangement or understanding not expressly set forth in this Agreement
\n(“Parole Agreements”). The parties acknowledge that in entering into this
\nAgreement, they have not relied and will not in any way rely upon any Parole
\nAgreements.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

10.<\/p>\n<\/td>\n

\n

COUNTERPARTS.<\/strong> This Agreement may be executed in one or more
\ncounterparts, any one of which need not contain the signatures of more than one
\nparty, but all such counterparts taken together, when delivered, will constitute
\none and the same instrument.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

11.<\/p>\n<\/td>\n

\n

GOVERNING LAW; CHOICE OF FORUM; ENFORCEMENT.<\/strong> The internal
\nlaw, without regard to conflicts of laws principles, of the State of Minnesota
\nwill govern all questions concerning the construction, validity and
\ninterpretation of this Agreement and the performance of the obligations imposed
\nby this Agreement. Any and every legal proceeding arising out of or in
\nconnection with this Agreement shall be brought in the appropriate courts of the
\nState of Minnesota, and each of the parties hereto consents to the exclusive
\njurisdiction of such courts.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

12.<\/p>\n<\/td>\n

\n

INJUNCTIVE RELIEF.<\/strong> Executive agrees that it would be
\ndifficult to compensate the Company fully for damages for any violation of the
\nprovisions of Paragraphs 3, 4 and 5 of this Agreement. Accordingly, Executive
\nspecifically agrees that the Company shall be entitled to injunctive relief to
\nenforce the provisions of such Paragraphs.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

5<\/p>\n

\n\n\n\n
\n

13.<\/p>\n<\/td>\n

\n

NO WAIVER.<\/strong> No term or condition of this Agreement shall be
\ndeemed to have been waived, nor shall there by any estoppel to enforce any
\nprovisions of this Agreement, except by a statement in writing signed by the
\nparty against whom enforcement of the waiver or estoppel is sought. Any written
\nwaiver shall not be deemed a continuing waiver unless specifically stated, shall
\noperate only as to the specific term or condition waived and shall not
\nconstitute a waiver of such term or condition for the future or as to any act
\nother than that specifically waived.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n\n\n\n
\n

14.<\/p>\n<\/td>\n

\n

MODIFICATION.<\/strong> This Agreement may not be altered, modified or
\namended except by an instrument in writing signed by Executive and the Company.\n<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

IN WITNESS WHEREOF<\/strong>, the parties hereto have caused this
\nAgreement to be executed as of the day and year first above written.<\/p>\n\n\n\n\n\n\n\n\n
<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
\n

NAVARRE CORPORATION<\/strong><\/p>\n<\/td>\n

<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n\n

EXECUTIVE<\/strong><\/p>\n<\/td>\n<\/tr>\n

<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
\n

By:<\/p>\n<\/td>\n

<\/td>\n\n

\/s\/ Cary L. Deacon<\/p>\n<\/td>\n

<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n\n

\/s\/ Diane Lapp<\/p>\n<\/td>\n<\/tr>\n

<\/td>\n<\/td>\n\n

Cary L. Deacon<\/p>\n<\/td>\n

<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n\n

Diane Lapp<\/p>\n<\/td>\n<\/tr>\n

\n

Its:<\/p>\n<\/td>\n

<\/td>\n\n

President and CEO<\/p>\n<\/td>\n

<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

6<\/p><\/p>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[8306],"corporate_contracts_industries":[],"corporate_contracts_types":[9539,9551],"class_list":["post-39923","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-navarre-corp","corporate_contracts_types-compensation","corporate_contracts_types-compensation__severance"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/39923","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=39923"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=39923"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=39923"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=39923"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}