Severance Agreement

SEVERANCE AND MUTUAL RELEASE AGREEMENT

(Alaska – Court-Ready Template)

TABLE OF CONTENTS

1. Document Header
2. Definitions
3. Operative Provisions
4. Representations & Warranties
5. Covenants & Restrictions
6. Default & Remedies
7. Risk Allocation
8. Dispute Resolution
9. General Provisions
10. Execution Block
11. Exhibits & Schedules

1. DOCUMENT HEADER

1.1 Parties

This Severance and Mutual Release Agreement (this “Agreement”) is entered into by and between [EMPLOYER LEGAL NAME], an Alaska corporation with its principal place of business at [ADDRESS] (“Employer”), and [EMPLOYEE LEGAL NAME], an individual residing at [ADDRESS] (“Employee”) (each, a “Party,” and collectively, the “Parties”).

1.2 Effective Date

This Agreement shall become effective on the eighth (8th) calendar day following Employee’s execution, provided Employee does not timely revoke under Section 3.7 (the “Effective Date”).

1.3 Recitals

A. Employee’s employment with Employer will terminate effective [TERMINATION DATE] (the “Separation Date”).
B. Employer desires to provide Employee with certain severance benefits in exchange for a full and final release of claims, subject to the Older Workers Benefit Protection Act (the “OWBPA”).
C. Employee desires to accept such severance benefits and release Employer from liability, all on the terms set forth below.

NOW, THEREFORE, in consideration of the mutual promises and covenants herein, the adequacy and sufficiency of which are acknowledged, the Parties agree as follows:

2. DEFINITIONS

For ease of reference, capitalized terms are defined alphabetically below and used consistently throughout this Agreement.

“ADEA” means the federal Age Discrimination in Employment Act, as amended.
“Affiliate” means any entity controlling, controlled by, or under common control with a Party.
“Claims” has the meaning given in Section 3.3.
“Confidential Information” has the meaning given in Section 5.2.
“Covered Period” means the period beginning on the Separation Date and ending on the last day of the Severance Period.
“Severance Benefits” has the meaning given in Section 3.1.
“Severance Period” means [NUMBER] months following the Separation Date.

3. OPERATIVE PROVISIONS

3.1 Severance Benefits

Subject to Employee’s timely execution, non-revocation, and continued compliance, Employer shall provide the following (collectively, the “Severance Benefits”):

a. Cash Severance: Lump-sum payment of $[SEVERANCE AMOUNT], less lawful withholdings, payable within ten (10) business days after the Effective Date.
b. COBRA Subsidy: Employer-paid premiums for Employee’s existing group health plan coverage during the Severance Period or until Employee becomes eligible for other coverage, whichever occurs first.
c. Outplacement: Up to [DOLLAR AMOUNT] in outplacement services, to be used within twelve (12) months of the Separation Date.
d. Other Consideration: [INSERT, IF ANY].

3.2 Consideration Period & Advice to Consult Counsel

Employee acknowledges that:

1. Employee has at least twenty-one (21) calendar days (or forty-five (45) days if this Agreement is offered in connection with a group termination program) to review and consider this Agreement before signing;
2. Employer hereby advises Employee in writing to consult with an attorney of Employee’s choosing prior to executing this Agreement; and
3. No one has hurried, coerced, or pressured Employee to sign before the end of the applicable consideration period.

If the waiver is offered in a group or class termination program, Employer must also provide at the beginning of the forty-five-day period the decisional-unit, eligibility, time-limit, job-title, and age information required by 29 U.S.C. § 626(f)(1)(H).

3.3 Mutual Release of Claims

a. Release by Employee. In exchange for the Severance Benefits, Employee, on behalf of Employee and Employee’s heirs, executors, administrators, and assigns, irrevocably waives and fully releases Employer, its Affiliates, and their respective officers, directors, employees, agents, insurers, successors, and assigns (the “Released Parties”) from any and all liabilities, claims, demands, causes of action, and damages of every kind, whether known or unknown, based on acts occurring on or before the date Employee signs this Agreement (collectively, “Claims”), including but not limited to:

i. claims under the ADEA, Title VII, ADA, FMLA, ERISA (other than vested benefits), and any other federal, state, or local statute;
ii. common-law claims, including breach of contract, tort, or defamation; and
iii. claims for attorneys’ fees and costs.

b. Release by Employer. Employer releases Employee from any and all Claims based on acts occurring on or before the date Employee signs this Agreement, excluding Claims arising from fraud, embezzlement, or willful misconduct.

c. Scope Limitations. Nothing herein waives (i) rights arising after Employee signs this Agreement; (ii) claims for unemployment or workers’ compensation; (iii) vested retirement benefits; (iv) rights to enforce this Agreement; or (v) claims that cannot be waived as a matter of law.

3.4 No Admission

This Agreement is a compromise and shall not be construed as an admission of liability by any Party.

3.5 Conditions Precedent

Employer’s obligations are contingent upon:
a. Employee’s timely return of all Employer property per Section 5.3; and
b. Employee’s continued compliance with Sections 5 and 6.

3.6 Tax Matters

Payments are subject to required withholding. Benefits and tax counsel must review the payment schedule before use; this template makes no tax-compliance representation to Employee.

3.7 Revocation Right

Employee may revoke this Agreement within seven (7) calendar days after signing by delivering written notice to [CONTACT NAME/TITLE]. This Agreement will be void if revoked.

4. REPRESENTATIONS & WARRANTIES

4.1 Mutual Representations

Each Party represents and warrants that:
a. It has full authority to execute and perform this Agreement;
b. It has not sold, assigned, or otherwise transferred any Claims released herein; and
c. Its execution of this Agreement does not violate any other agreement.

4.2 Employee Specific

Employee confirms only that all known unpaid-compensation issues have been listed here: [________________________________]. Employer remains responsible for final wages under Alaska Stat. § 23.05.140: within three working days after an employer-initiated termination, or on the next regular payday at least three days after notice of an employee-initiated termination. The release does not substitute for payment already due.

4.3 Survival

All representations and warranties shall survive the Effective Date for a period of three (3) years.

5. COVENANTS & RESTRICTIONS

5.1 Non-Disparagement

During the Covered Period, neither Party shall knowingly make a false statement of fact intended to harm the other Party’s reputation. This Section does not restrict truthful statements, government communications, protected concerted activity, whistleblower reports, testimony, or other conduct protected by law.

5.2 Confidentiality

Employee shall protect legitimate trade secrets and non-public proprietary information. This Section does not restrict discussion of wages or working conditions, government communications, whistleblower reports, testimony, or other conduct protected by law. The payment amount may be disclosed to Employee’s attorney, tax advisor, spouse, or as required by law.

5.3 Return of Property

Within five (5) calendar days after the Separation Date, Employee shall return all Employer property, including documents, devices, keys, and credit cards, and permanently delete Employer data from personal devices.

5.4 Continuing Obligations

No prior restrictive covenant is automatically reaffirmed by this Agreement. Any proposed post-employment restraint requires separate Alaska legal review and must be identified expressly here: [________________________________].

6. DEFAULT & REMEDIES

6.1 Events of Default

The following constitute a default:
a. Employee’s material breach of Sections 5.1–5.3;
b. Employer’s failure to pay Severance Benefits when due, subject to a five-day cure period after written notice.

6.2 Remedies

A Party may seek lawful contract remedies for a proven material breach. No remedy creates a release-challenge penalty, requires repayment merely for filing or participating in an agency matter, or restricts a protected communication.

6.3 Employee Remedies

Upon Employer’s uncured default, Employee may pursue payment in a court with jurisdiction or under a separately signed arbitration addendum, if one exists.

6.4 Attorneys’ Fees

This template creates no prevailing-party fee shift.

7. NO EMPLOYEE RISK-SHIFTING

This Agreement does not impose employee indemnity, a liability cap, a force-majeure excuse for payment, a severance clawback, or a penalty for a good-faith challenge to the release. The rules governing ADEA waiver challenges remain controlled by 29 C.F.R. § 1625.22.

8. DISPUTE RESOLUTION

8.1 Governing Law

This Agreement shall be governed by and construed in accordance with the laws of the State of Alaska and, where applicable, federal law, without giving effect to conflict-of-law principles.

8.2 Forum

An action concerning this Agreement may be filed in an Alaska state or federal court with subject-matter and personal jurisdiction and proper venue.

8.3 Arbitration (Optional)

No arbitration clause is included. If selected, use a separately reviewed addendum addressing formation, costs, discovery, remedies, and governing law.

8.4 Jury Trial Waiver (Optional)

No predispute jury waiver is included in this template.

8.5 Protected Rights

Nothing in this Article restricts agency access, protected communications, or claims and remedies that cannot be waived privately.

9. GENERAL PROVISIONS

9.1 Amendment & Waiver

No modification of this Agreement shall be effective unless in a written instrument signed by both Parties. A waiver on one occasion shall not constitute a waiver on another.

9.2 Assignment

Employee may not assign or delegate any rights or obligations hereunder. Employer may assign this Agreement to a successor in connection with a merger, consolidation, or sale of substantially all assets.

9.3 Successors & Assigns

This Agreement shall inure to the benefit of and be binding upon the Parties and their respective successors and permitted assigns.

9.4 Severability

If any provision is held invalid, the remaining provisions shall remain enforceable, and the invalid provision shall be reformed to the minimum extent necessary to give effect to the Parties’ intent.

9.5 Entire Agreement

This Agreement constitutes the entire agreement between the Parties with respect to its subject matter and supersedes all prior oral or written agreements.

9.6 Counterparts; Electronic Signatures

This Agreement may be executed in counterparts, each of which is deemed an original, and all of which together constitute one instrument. Signatures delivered by facsimile, PDF, or electronic signature platform shall be deemed original.

10. EXECUTION BLOCK

IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the dates set forth below.

Sources and References

• 29 U.S.C. § 626(f)
• 29 C.F.R. § 1625.22
• Alaska Statutes Title 23 — AS 23.05.140

11. EXHIBITS & SCHEDULES

Exhibit A List of Job Titles and Ages of Employees Selected/Not Selected for Separation
(Required ONLY if 45-day OWBPA consideration period applies to a group termination.)