HomeMy WebLinkAboutThomas Schwab-2009-08 (2) SETTLEMENT,RETIREMENT AND RELEASE
AGREEMENT
RECITALS
THIS SETTLEMENT,RETIREMENT AND RELEASE AGREEMENT is hereby
made by and among the City of Grand Terrace(the"City) and Grand Terrace Redevelopment
Agency the("Agency") and Thomas Schwab as follows:
WHEREAS, Thomas Schwab has been employed by the City of Grand Terrace as
Finance Director and City Manager for a total of approximately 25 years; and
WHEREAS, in June, 2008, Mr. Schwab had a debilitating medical condition which
resulted in him being unable to perform full-time duties as City Manager for a lengthy period
time. Mr. Schwab was employed as City Manager pursuant to the contract between himself and
the City of Grand Terrace ("City") which contract was terminated based upon mutual agreement
and replaced by an employment agreement, dated December 9, 2009, setting forth duties to be
performed by Mr. Schwab, and providing compensation therefore. This Agreement will
automatically terminate on June 30,2009; and
WHEREAS, Mr. Schwab believes that he is able to perform the duties as City Manager
and has requested reinstatement and believes that, in the absence of such reinstatement, he has
certain legal rights both in tort and under the pre-existing City Manager contract; and
WHEREAS, while the City Council is willing to consider Mr. Schwab as a candidate for
City Manager as a part of the selection process for the City Manager position, the City Council
does not believe that he has any legal rights beyond those of other candidates and that the City
has no legal obligation to re-hire Mr. Schwab; and
WHEREAS, rather than pursue such legal remedies as Mr. Schwab believes may exist,
Mr. Schwab has proposed to the City in settlement of those claims that the City purchase on his
behalf four additional years of retirement credit through the Public Employees Retirement
System in order that he may retire; and
WHEREAS, it is the desire of the Parties that this settlement agreement be tax exempt
under IRC 104(a), although expressly neither the City nor the Agency have advised Mr. Schwab
that such is the case nor warrant that such is the case.
WHEREAS, after due consideration and based upon the terms of this Agreement, the
City has agreed to accept Mr. Schwab's proposal which will allow him to retire; and
WHEREAS, it is acknowledged that this has been a difficult decision by all parties
involved and, based upon Mr. Schwab's belief that retirement at this time is in his personal and
family best interest,the City agrees to this Settlement, Retirement and Release Agreement.
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B. For and in consideration of this Agreement, the City agrees to purchase four (4)
years of additional retirement credit in the Public Employees Retirement System on behalf of
Mr. Schwab.
C. For and in consideration of the purchase by the City of four(4) years of additional
retirement credit in the Public Employees System, the undersigned Thomas Schwab ("Releasor")
does hereby release, acquit and forever discharge the City of Grand Terrace and the
Redevelopment Agency of the City of Grand Terrace, their elected officials, officers, agents,
servants, successors, and employees, ("Releases") of and from any and all claims, actions,
judgments, causes of action, demands, rights, damages, costs, loss of service, expenses, and
compensation whatsoever, which the undersigned now has no matter when the same arose, or
which may hereafter accrue on account of or in any way growing out of any and all known and
unknown, foreseen and unforeseen, damages and the consequences thereof, resulting or to result,
from the termination of Releasor's employment status.
Said payment is made with the understanding that the above-referenced claim is resolved,
in its entirety.
It is the intent of this Agreement to compromise any and all claims which the undersigned
now has or may hereafter acquire in any manner by reason of, or even remotely arising out of the
Releasor's termination of employment.
It is understood and agreed that this settlement is the compromise of a doubtful and
disputed claim, and that the payment made is not to be construed as an admission of liability on
the part of the party or parties hereby released, and that said parties deny liability therefore and
intend merely to avoid litigation and to buy their peace.
It is further understood and agreed that all rights under Section 1542 of the Civil Code of
California and any similar law of any state or territory of the United States are hereby expressly
waived. Said Section reads as follows:
"1542. Certain claims not affected by general release. A general release does not
extend to claims which the creditor does not know or suspect to exist in his favor at
the time of executing the release, which if known by him, must have materially
affected his settlement with the debtor."
In further consideration of said Settlement, Release and Termination Agreement, Thomas
Schwab represents and warrants and agrees to indemnify and hold harmless the Releasees named
above against any claim, suit, lien or demand, arising out of the claim(s) or representation of
Thomas Schwab, in the above-referenced action; it being the full intent of the parties that the
payment made by said Releasees to the undersigned is in full satisfaction of all claims made by
the undersigned with respect to said Releasees.
The undersigned represents and warrants that no portion of any claim, right, lien, demand,
action, or cause of action, that Releasor has or might have arising out of said occurrence against
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said released parties has been assigned or transferred in any manner, including by way of
subrogation or operation of law except as herein noted and expected.
Mr. Thomas Schwab does declare and represent that he is effecting this Settlement and
executing this Release after having received full legal advice as to his rights from legal counsel.
This Release contains the entire Agreement between the parties hereto, and the terms of
this Release and Settlement Agreement are contractual and not a mere recital.
Mr. Schwab further states that he has carefully read the foregoing Settlement, Release and
Termination Agreement and knows the contents thereof, and has hereto signed the same as his
own free act.
Executed on this day of June, 2009 at Grand Terrace, California.
By: n
Thomas Schwab
CITY OF GRAND TERRACE AND GRAND
TERRACERR/n REDEVELOPMENT AGENCY
By:
"/�'c
Maryetta rre, Mayor and Chairperson
Approved as
t rm and Content:
By v'Il
John R. Harpe ity Attorney
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