EMPLOYMENT CONFIDENTIALITY AND INVENTION AGREEMENT
THIS EMPLOYMENT, CONFIDENTIALITY AND INVENTION AGREEMENT ("Agreement")
is dated the 12th day of December, 1997, and is entered into by and between MECA
SOFTWARE, L.L.C., a Delaware corporation ("Company"), and Xxxx X. Xxxxxxxx
("Executive").
Statement of Purpose
The Company and Executive previously entered into an Amended and
Restated Employment, Confidentiality and Invention Agreement dated June 22, 1995
(the "Employment Agreement") and Severance Agreement dated June 30, 1997 ("the
Severance Agreement"). The Company and the Executive desire to replace the
Employment Agreement and the Severance Agreement except for certain provisions
set forth more fully below. Accordingly, the following provisions supersede in
their entirety the Employment Agreement and the Severance Agreement effective as
of January 1,1998 (the AEffective Date@), except that the provisions of Section
1.03 ( c ) of the Employment Agreement dealing with payment and vesting of
long-term incentive awards earned through the Effective Date shall continue to
apply; provided, however, that if the vesting of Deferral Accounts is increased
to 100% pursuant to Section 1.03 (c ) (iii) of this agreement, then such
long-term incentive awards shall become 100% vested as well.
ARTICLE ONE
EMPLOYMENT
1.01B Term of Employment. The Company hereby agrees to employ the
Executive and Executive hereby accepts such employment by the Company for the
period beginning on the Effective Date and ending thirty-six months from the
Effective Date ("Employment Period"), subject to the provisions of Section 1.07.
Any termination or expiration of this Agreement shall not be effective as to
those portions of this Agreement which, by their express terms as set forth
below, require performance by any party following termination of this Agreement.
1.02 B Duties. Executive is employed by the Company to:
(a) serve in an executive management capacity for the
Company subject to the authority and direction of the Board of Directors of the
Company and its more senior executives and, subject to the foregoing, the
Executive shall have such authority and responsibility and duties as are
normally associated with such position; and
(b) perform such other duties and responsibilities
and exercise such other authority and have such other titles transferred as
the Board of Directors of more senior executives of the Company may, from time
to time, reasonably prescribe (giving due consideration to Executive's
experience and expertise); provided, however, that the Company shall not
relocate Executive beyond 35 miles from Executive's present business location
without Executive=s prior consent; and
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED AS TO CERTAIN PORTIONS OF THIS
DOCUMENT.
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(c) so long as Executive is employed under this
Agreement, devote Executive's full business time and efforts exclusively on
behalf of the Company. Executive shall not be prohibited form engaging in such
personal, charitable, or other nonemployment activities as do not interfere with
Executive=s full-time employment hereunder and which do not violate the other
provisions of this Agreement. Executive shall comply fully with all reasonable
policies of the Company as are from time to time in effect.
1.03B Compensation. (a) Base Salary. The Company shall pay to Executive
during the Employment Period a minimum gross salary at an annual rate of $ **
(the "Base Salary"), payable monthly or at any shorter pay periods as the
Company may form time to time use for its other executive employees.
(b) Short Term Incentive Awards. The Company shall establish
for Executive for each "Performance Year" (as defined below) during the
Employment Period a short term incentive arrangement pursuant to which Executive
shall have the opportunity to earn an award based on the achievement of
specified performance criteria during the applicable Performance Year. The award
for a Performance Year shall have a targeted amount of not less than $ **, but
the actual amount paid, if any, will depend on the level of achievement of the
specified performance criteria and shall be no less than $ ** and no more than $
**. Any earned short term incentive award shall be payable within ninety (90)
days following the end of the applicable Performance Year. For purposes of this
Agreement, "Performance Year" means each of the calendar years 1998, 1999 and
2000.
(c) Long Term Incentive Award. Executive shall
be eligible to receive long term incentive award in accordance with the
following provisions:
(i) Variable Award. As of the last day of each
Performance Year, Executive shall be awarded a sum equal to the Short Term
Incentive awarded for such Performance Year pursuant to Section 1.03 (b),
subject to the provisions of this Section 1.03 (c). Amounts awarded pursuant to
this Section 1.03 (c) (I), if any, shall be credited to the Deferral Account as
of such day. A separate Deferral Account shall be established for each
Performance Year.
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE INFORMATION
CONTAINED WITHIN THE "[**]" MARKINGS. SUCH MARKED PORTIONS HAVE BEEN OMITTED
FROM THIS FILING AND HAVE BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.
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(ii) Interest Credits. As of the last day of each calendar
year, each Deferral Account shall be credited with interest in an amount equal
to the balance of the Deferral Account as of the beginning of such Performance
Year times the yield to maturity on five (5) year U.S. Treasury Bonds determined
as of the last business day of the immediately preceding Performance Year.
(iii) Vesting. As of the last day of the calendar year
following the Performance Year for which a Deferral Account was established
one-third (1/3) of the balance of such Deferral Account as of such date shall
become vested. As of the last day of the second calendar year following the
Performance Year for which a Deferral Account was established two-thirds (2/3)
of the balance of such Deferral Account as of such date shall become vested. As
of the last day of the third calendar year following he Performance Year for
which a Deferral Account was established all of the balance of such Deferral
Account shall become vested. All Deferral Accounts shall become 100% vested upon
the end of the Employment Period or upon termination of the Employment of the
Executive, other than a voluntary termination by Executive or termination by the
Company for cause, prior to the end of the Employment Period. Notwithstanding
the foregoing, in the event of Executive's death or Atotal and permanent
disability@ (as defined in Section 1.06 below), the amount credited to the
Deferral Account as of the date of such death or Atotal and permanent
disability@ shall become fully (100%) vested as of such date.
(iv) Forfeiture and Cessation of Credits. In the
event Executive's employment with the Company is terminated by the Employee
voluntarily or by the Company for cause (as defined in Section 1.07(a), below)
prior to the Deferral Account becoming fully (100%) vested in accordance with
subparagraph (iv) above, then (i) any unvested portion of the Deferral Account
shall be forfeited as of the date of such termination and (ii) any vested
portion of the Deferral Account that has not been previously paid but instead
has been further deferred by the parties shall be paid in accordance with the
applicable deferral agreement, if any, between the parties and no further
amounts (including award under subparagraph (i) above and interest credits under
subparagraph (iii) above) shall be credited to any Deferral Account.
(v) Payment. As of the date an amount becomes vested
in the Deferral Account in accordance with subparagraph (iv) above, such
amount shall become payable to Executive, reduced by any amount(s) that
previously became payable to Executive in accordance with this subparagraph (v).
Any such amount shall be paid to Executive in a single cash payment within
ninety (90) days after such date; provided, however, that the parties reserve
the right to provide for the further deferral of any such amount in accordance
with their mutual agreement from time to time.
(vi) Miscellaneous. Executive's rights and
interests in the Deferral Account may not be assigned or transferred by
Executive. The amount credited to the Deferral Account shall be an unsecured and
unfunded obligation of the Company. To the extent Executive acquires a right to
receive payments form the Deferral Account under this Section 1.03 (c), such
right shall be no greater the right of any unsecured general creditor of the
Company. Nothing contained in this Section 1.03 (c) shall be deemed to create a
trust of any kind or any fiduciary relationship between the Company and
Executive.
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1.04 B Business Expenses. The Company shall promptly pay directly, or
reimburse Executive for, all business expenses, to the extent such expenses are
paid or incurred by Executive during the term hereof in accordance with the
Company policy approved by the Board of Directors of the Company and in effect
form time to time and to the extent such expenses are reasonable and necessary
to the conduct by Executive of the business of the Company.
1.05B Fringe Benefits. During the Employment Period, the Company shall
provide to Executive such insurance, vacation sick leave and other like benefits
as are approved by the Board of Directors of the Company and provided form time
to time to the other management-level employees holding similar positions with
the Company.
1.06 B Death; Disability. Upon the death of Executive or in the event
of the Executive's 'total and permanent disability," the Employment Period and
the payments under Sections 1.03 (a ) and 1.05 to Executive shall cease as of
the end of the month during which either such event may occur. In addition, no
payments under Section 1.03 (b) shall be made if such death or 'total and
permanent disability' occurs prior to the payment date therefor, and Section
1.03 (c) shall govern regarding the effect of Executive's death or "total and
permanent disability" on any awards thereunder. Executive shall be entitled to
receive such payments as may be provided under any benefit plans maintained by
the Company and applicable to the Executive. "Total and permanent disability"
shall have the meaning provided in any long-term disability or similar plan
maintained form time to time by the Company or, in the absence thereof, shall
mean the inability, in the opinion of a physician selected by the Company and
reasonably acceptable to Executive, of Executive to perform Executive's
employment duties under this Agreement by reason of Executive's physical or
mental illness or condition of permanent or indefinite duration.
1.07 B Other Termination of Employment and Employment Period. The
employment of Executive under this Agreement may be terminated by the Company
during the Employment Period in accordance with subsections 1.07 (a) or (b)
below.
(a) Executive's employment may be terminated by the Company if
"cause" for such termination exists and the Company serves written notice of
such termination upon Executive. As used in this Agreement, the term "cause"
shall refer only to any one or more of the following grounds:
(i) commission of an act of dishonesty, including, but
not limited to, misappropriation of funds or any property of the Company;
(ii) engaging in business-related activities or conduct
injurious to the reputation of the Company;
(iii) incompetently performing Executive=s assigned duties and
responsibilities or failing to manage the Company in a manner consistent with
the directions of the Board of Directors of the Company (after 30-
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days following the written notice described above from the Company specifying
such incompetent performance or lack of performance and Executive's failure to
cure or remedy the same within such 30-day period);
gross insubordination by Executive;
(v) the violation of any of the terms and conditions of this
Agreement (so long as such violations continue) or any material written
agreement or agreements Executive may from time to time have with the Company;
or
(vi) conviction of Executive for a misdemeanor (involving an
act of moral turpitude) or a felony.
In the event Executive=s employment is terminated under this Section 1.07 (a),
Executive's Base Salary under Section 1.03 (a) and Executive's fringe benefits
under Section 1.05 shall be paid through the date of such termination and no
payments under Section 1.03 (b) shall be made if such termination occurs prior
to the payment date therefor. In addition, Section 1.03 (c) shall govern
regarding the effect of a termination of employment on any awards thereunder.
(b) The Company may, in its sole discretion, terminate
Executive=s employment with the company upon 30 days' prior written notice
without cause. Upon termination of Executive's employment without cause during
the Employment Period, the Company shall continue to pay Executive=s Base Salary
and provide the benefits described in Section 1.05 through the balance of the
year within which such notice was given and thereafter for an additional period
of twelve (12) months or the balance of the Employment Period, whichever is
longer (the "Additional Period"). Payments of the target amount under Section
1.03 (b) shall be made with respect to a Performance Year under Section 1.03 (b)
if such termination occurs prior to the end of such Performance Year and for the
Additional Period, and payments under Section 1.03 (c) shall be made for the
Performance Year in which such termination occurs. Upon any expiration of the
Employment Period or cessation of Executive's employment hereunder, the Company
shall have no further obligations under this Agreement and no further payments
shall be payable by the Company to Executive, except as provided in this
subsection (b) or Section 1.03 (c) and except as required by the express terms
of any written benefit plans or written arrangements maintained by the Company
and applicable to Executive at the time of such termination, expiration or
cessation of Executive's employment.
1.08 B Change in Work Location, Duties or Base Salary. Without limiting
the definition of "cause" under Section 1.07(a), if the Company's Board of
Managers requests in writing that Executive (i) relocate beyond 35 miles form
Executive's present business location or (ii) significantly change his
employment duties, and Executive declines either such request, then such request
shall be deemed to be termination of Executive's employment by the Company
without cause. In addition, if the Company decreases the aggregate of (A)
Executive's Base Salary (as defined in Section 1.03 (a) and (B) Executive's
short term incentive award target (as described in Section 1.03 (b)) by more
than 10% in any one year period and Executive declines to continue his
employment by the Company within three months after the initial effective data
of such decrease, then such decrease shall be deemed to be a termination of
Executive's employment by the Company without cause.
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ARTICLE TWO
CONFIDENTIALITY AND INVENTIONS
2.01 B Background and Relationship of Parties. The parties acknowledge
that the Company has been and will be engaged in a continuous program of
acquisition, research, development and production respecting its business,
present and future, and that, in connection with Executive=s employment by the
Company, Executive is and will be expected to make or have access to new
contributions and inventions of value to the Company and that Executive's
employment creates a relationship of confidence and trust between Executive and
the Company with respect to any information applicable to the business of the
Company or applicable to the business of any client or customer of the Company
which has been or may be made known to Executive by the Company or by any such
client or customer or has been or may be learned by Executive during any period
of Executive's employment with the Company. Executive possesses and had and will
possess or have unfettered access to information that has been created,
discovered, developed, acquired or otherwise become known to the Company
(including, without limitation, information created, acquired, discovered,
developed, or made known to Executive prior to and during the Employment Period)
and which has commercial value in the business in which the Company has been and
will be engaged and has not been publicly disclosed by the Company. All
information described above hereinafter called AProprietary Information.@ By way
of illustration, but not limitation, Propriety Information includes hardware,
formulae, processes, software, documentation, data, programs, know-how, trade
secrets, improvements, discoveries, developments, designs, inventions,
techniques, marketing plans, product information, business and financial
information and plans, strategies, forecasts, new products, financial
statements, budgets, projections, licenses, prices, acquisition plans, costs and
lists of customers and suppliers. The term Asuppliers@ as used herein includes,
without limitation, information providers, system operators, third-party
software and hardware developers and other independent contractors supplying
goods or services to the Company. Proprietary Information shall not include
information which is now or hereafter is made public by third parties in a
lawful manner or made public by parties hereto without violation of this
Agreement.
2.02 B Inventions and Proprietary Information are Property of the
Company. (a) Executive has or will promptly disclose to the Company (or any
persons designated by it) all discoveries, developments, designs, improvements,
inventions, formulae, software, hardware, documentation, processes, techniques,
know-how, trade secrets and data, whether or not patentable or registrable under
copyright or similar statutes, made or conceived or reduced to practice or
learned by Executive, either alone or jointly with others, during the period of
Executive's employment (whether or not during regular business hours) by the
Company and that result from or are conceived during the performance of tasks
which have been, or that are or will be assigned to or otherwise undertaken by
Executive or that relate to the business or products of the Company or that
result form use of property, equipment, or premises owned, leased or contracted
for by the Company. All such discoveries, developments, designs, improvements,
inventions, formulae, software, hardware, documentation, processes, techniques,
know-how, trade secrets and data are hereinafter referred to as AInventions.@
All Proprietary Information and all Inventions are and shall be the
sole property
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of the Company and its assigns, and it shall be the sole owner of all patents,
copyrights, trademarks, names and other rights in connection therewith,
Executive hereby assigns to the Company any rights Executive may have or may
acquire in such Proprietary Information and Inventions. At all times, during the
Employment Period and thereafter, Executive will keep in strictest confidence
and trust all Proprietary Information and Inventions and Executive will not use
or disclose any Proprietary Information or Inventions without written consent of
the Company, except as may be necessary in the ordinary course of performing
duties as an employee of the Company or as may be required by law or the order
of any court or governmental authority. As to all Inventions, Executive shall
assist the Company in every proper way (but at the expense of the Company) in
obtaining and form time to time enforcing patents, copyrights, and other rights
and protections relating to Inventions in any and all countries and to that end,
Executive will execute all documents for use in applying for and obtaining such
patents, copyrights and other rights and protections and enforcing such
Inventions as the Company may desire, together with any assignments thereof, to
the Company or persons designated by either of them. Executive's obligation to
assist the Company in obtaining and enforcing patents, copyrights and other
rights and protections relating to Inventions in any way and in all countries
shall continue beyond the Employment Period, but the Company shall, unless
Executive's Employment with the Company continues beyond the Employment Period,
compensate Executive at a reasonable rate after termination of the Employment
Period for the time actually spent by Executive at the request of the Company
for such assistance. In the event the Company is unable, after reasonable
effort, to secure the signature of Executive on any document or documents needed
to apply for or procure any patent, copyright, or other right or protection
relating to an invention, whether because of Executive's physical or mental
incapacity or for any other reason whatsoever, Executive irrevocably designates
and appoints the Company and its duly authorized officers and agents as the
agent and attorney-in-fact of Executive to act for and in behalf and stead of
Executive to execute and file any such application or applications and to do all
other lawfully permitted acts to further the prosecution and issuance of
patents, copyrights or similar protections thereon with the same legal force and
effect as if executed by Executive.
(c) In the event of the termination (during the Employment
Period or thereafter) of Executive's employment by the Company for any reason
(including no reason), Executive shall promptly deliver to the Company all
copies of all documents, notes, drawings, specifications, programs, software,
hardware, documentation, data and other materials of any nature belonging to the
Company and obtained during the course of Executive's employment with the
Company. Executive will not remove any of the foregoing or any reproduction of
any of the foregoing or any Proprietary Information or Invention that is
embodied in a tangible medium of expression.
2.03 B Confidentiality of Agreement. Executive shall keep in full
confidence all information concerning this Agreement, including without
limitation the amount of Executive's Base Salary and incentive award
opportunities, except (i) to the extent disclosure is made to more senior
executives of the Company or with the Company=s prior written consent, (ii) to
the extent disclosure is or may be required by applicable law or (iii) in
connection with Executive's financial planning (e.g., estate planning, tax
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planning, loan or other financing applications, etc).
ARTICLE THREE
NON-COMPETITION
3.01 B During and After Employment. During the "Covenant Period" (as
defined below), Executive shall not engage in, or own or control any interest in
(except as a passive investor in publicly-held companies, holding less than one
percent of its outstanding securities), or act as an officer, director or
employee of, or consultant, advisor or lender to, any firm, corporation or
institution which provides, publishes, manufactures, or markets any computer
software products or services and related documentation which the Company
provides, publishes, manufactures or markets (or which the Company is engaged in
evaluating or developing). For purposes of this Agreement, "Covenant Period"
means and refers to the period during which Executive is actually employed by
the Company plus (i) the remainder of the Employment Period if Executive's
employment is terminated in accordance with provisions of Section 1.07 (a), or
(ii) the period during which amounts are payable by the Company to Executive in
accordance with the provisions of Section 1.07 (b) if Executive's employment is
terminated in accordance with the provisions of Section 1.07 (b).
3.02 B Non-Hiring of Company Employees. During the Covenant Period, the
Executive will not recruit, solicit or hire any employee of the Company or
otherwise induce any such employee to leave the employment of the Company to
become an employee of or otherwise be associated with Executive or any company
or business with which Executive is or may become associated.
3.03 B Non-Solicitation of Customers. During the Covenant Period,
Executive will not directly or indirectly, by or for the Executive or with or on
behalf of any other person, partnership, corporation, firm or other entity,
solicit, call upon or otherwise contact any "Customer of the Company" (as
defined below) for the purpose of providing to such Customer of the Company the
types of services or products normally provided by the Company to its customers.
For purposes of this Section 3.03, "Customer of the Company" means and refers to
(A) each customer served by the Company during the period of Executive's
employment hereunder and (B) each person or entity formally solicited by the
Company during the six (6) month period ending on the date of termination of
Executive's employment hereunder.
3.04 B No Conflicts. Executive represents that the performance by
Executive of all the terms of this Agreement, as a former or continuing employee
of the Company has not, does not and will not breach any agreement as to which
Executive is or was a party and which requires Executive to keep any information
in confidence or in trust. Executive has not entered into, and will not enter
into, any agreement either written or oral in conflict herewith. Executive has
not brought with Executive to the Company nor will Executive use in the
performance of employment responsibilities at the Company any proprietary
materials or documents of a former employer that are not generally available to
the public, unless Executive has obtained express written authorization from
such
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former employer for their possession and use. Executive has delivered to the
Company a true and correct copy of any employment, proprietary information,
confidentiality or non-competition agreement to which Executive is or was a
party with any former employers, which remains or may remain in effect as of the
date of Executive's first employment by the Company and which Executive was able
to obtain a copy of. Executive has not and will not breach any obligation of
confidentiality that Executive may have to former employers and Executive shall
fulfill all such obligations during Executive's employment with the Company.
3.05 B Reasonableness of Restrictions. Executive acknowledges that the
restrictions contained in this Agreement are reasonable, but should any
provisions of this Agreement be determined invalid, illegal or otherwise
unenforceable or unreasonable in scope by any court of competent jurisdiction,
the validity, legality and enforceability of the other provisions of this
Agreement shall not be affected thereby and the provision found invalid, illegal
or otherwise unenforceable or unreasonable, shall be considered by the Company
to be amended as to scope of protection, time or geographic area (or any one of
them, as the case may be) in whatever manner is considered reasonable by that
court and, as so amended, shall be enforced.
ARTICLE FOUR
MISCELLANEOUS
4.01 B Entire Agreement. This Agreement constitutes the entire
agreement and understanding between the Company and Executive concerning the
subject matter hereof and any other agreements between the Company and Executive
concerning the subject matter hereof are terminated without further liability of
any party thereto. No modification, amendment, termination or waiver of this
Agreement shall be binding unless in writing and signed by Executive and a duly
authorized officer of the Company. Failure of the Company or Executive to insist
upon strict compliance with any of the terms, covenants or conditions hereof
shall not be deemed a waiver of such terms, covenants and conditions.
4.02 B Specific Performance by Executive. Executive acknowledges that
money damages alone will not adequately compensate the Company for breach of any
of Executive's covenants and agreements herein and, therefore, in the event of
the breach or threatened breach of any such covenant or agreement by Executive,
in addition to all other remedies available to the Company at law, in equity or
otherwise, the Company shall be entitled to injunctive relief compelling
specific performance of (or other compliance with) the terms hereof. The party
adjudged by a court of competent jurisdiction to be the losing party to any
legal action under this Section 4.02 shall pay the legal fees of the party so
adjudged to be the successful party.
4.03 B Survival. This Agreement shall be binding upon Executive
irrespective of the duration of Executive's employment by the Company, the date
of or reasons for the termination of Executive's employment by the Company, or
the amount of Executive's salary or wages. The provisions of Article Two and
Article Three shall survive (i) the
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termination of Executive's employment by the Company irrespective of the reasons
for such termination and (ii) the expiration of this Agreement regardless of
whether Executive remains employed with the Company after such expiration, and
such provisions shall not in any way be modified, altered or otherwise affected
by Executive's termination or this Agreement=s expiration.
4.04 B Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of Executive and the heirs, executors and administrators of
Executive or Executive's estate and property and shall be binding upon and inure
to the benefit of the Company and its successors and assigns. Executive may not
assign or transfer to others the right to receive payments hereunder nor the
obligation to perform duties hereunder.
4.05 B Executive's Acknowledgement. EXECUTIVE ACKNOWLEDGES THAT, BEFORE
PLACING Executive's SIGNATURE HEREUNDER, EXECUTIVE HAS READ ALL OF THE
PROVISIONS OF THIS EMPLOYMENT, CONFIDENTIALITY AND INVENTION AGREEMENT, AND HAS
THIS DAY RECEIVED A COPY HEREOF.
4.06 B Taxes. From any payments due hereunder to Executive form the
Company, there shall be withheld amounts reasonably believed by the Company to
be sufficient to satisfy liabilities for federal, state and local taxes and
other charges. Executive remains primarily liable to such authorities for such
taxes and charges to the extent not actually paid the Company.
4.07 B Notices. Notices hereunder shall be deemed delivered five days
following deposit thereof in the United States mails (postage prepaid) addressed
to Executive at the Company location where Executive is primarily employed and
to the Company at 00 Xxxxx Xxxxx, Xxxxxxxxx, Xxxxxxxxxxx 00000, ATTN: Chairman
of the Board.
4.08 B Life Insurance. Executive acknowledges that the Company has an
insurable interest in the life of the Executive and that Executive will, from
time to time as requested by the Company, cooperate with the Company in its
purchase (at its sole cost) of life insurance on the life of the Executive, such
insurance to be payable to and owned by the Company.
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This Agreement is to be governed by, constructed and enforced in
accordance with, the laws of the State of Connecticut. This Agreement may be
executed in one or more counterparts which, together, shall constitute the
agreement of the parties hereto.
IN WITNESS WHEREOF, Executive has hereunto set Executive's hand and
seal and the Company has caused this Agreement to be executed by its duly
authorized officer, all as of the day and year first above written.
WITNESS:
/s/ Xxxxxx X. Bump Jr. /s/ Xxxx X. Xxxxxxxx
---------------------------- ---------------------------
Name: Xxxxxx X. Bump Jr. Xxxx X. Xxxxxxxx
"Executive"
MECA SOFTWARE, L.L.C.,
A Delaware Corporation
By: /s/ Xxx Xxxxx Xxxxxxxx
------------------------
Name: Xxx Xxxxx Xxxxxxxx
Title: EVP
"Company" MECA Compensation Committee
AGREEMENT
THIS AGREEMENT made this 27th day of May, 1999 by and among CFI
ProServices, Inc., an Oregon corporation with a principal place of business in
Portland, Oregon ("Company"), MECA Software, L.L.C., a Delaware limited
liability company with offices in Trumbull, Connecticut ("MECA Software"), and
Xxxx X. Xxxxxxxx, of Newtown, Connecticut ("Executive").
STATEMENT OF PURPOSE
A. Executive and MECA Software are parties to that certain Employment,
Confidentiality and Invention Agreement, dated December 12, 1997 (the
"Agreement"), a copy of which is attached hereto as Exhibit A.
Effective as of May 17, 1999, the Company acquired all of the ownership
interests of MECA Software (the "Acquisition"), and, subsequent to the
Acquisition, MECA Software is a wholly owned subsidiary of the Company (or its
affiliates). The Company has requested Executive remain with MECA Software to
aid in the transition of ownership and the Executive has agreed to do so,
subject to the terms and conditions set forth herein.
AGREEMENT
Executive agrees to remain employed by MECA Software through and including
January 2, 2000 pursuant to the terms of the Agreement, as modified herein, and
agrees to perform such duties as are reasonably required of him by the Company.
To the extent such notice is deemed necessary by any party to this agreement,
Executive, the Company and MECA Software each hereby acknowledge and give notice
that Executive's employment with MECA Software is hereby terminated, effective
as of January 2, 2000. The parties agree that the effective date of such
termination shall not be changed without the written consent of all parties to
this Agreement.
Article 1 of the Agreement (except for the last sentence of Section 1.01 and
Section 1.04 thereof) is hereby deleted in its entirety and the terms there
stated shall be of no further force and effect. Notwithstanding the foregoing,
the parties hereby acknowledge and agree that the compensation to be paid to
Executive pursuant to paragraph 4 of this Agreement represents amounts,
obligations and liabilities arising from such Article 1, and this Agreement is
not intended to modify, increase or enlarge the obligations of the Company or
MECA Software under the Agreement.
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED AS TO CERTAIN PORTIONS OF THIS
DOCUMENT.
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The Company and MECA Software hereby agree that MECA Software shall compensate
Executive as follows (such compensation to be in lieu of any compensation due to
Executive under the Agreement):
Base Salary. From the date hereof through December 31, 2000, MECA
Software shall pay to Executive a gross salary at an annual rate of $
**, payable twice monthly.
Lump Sum Payments.
On or before January 31, 2000, MECA Software shall pay to
Executive a lump sum payment of $ **.
On or before January 31, 2001, MECA Software shall pay to
Executive a lump sum payment of $ **.
The foregoing lump sum payments shall be made via corporate
check or wire transfer of funds, at the discretion of MECA
Software or the Company.
MECA Software shall continue to provide to the Executive the fringe
benefits set forth in Section 1.05 of the Agreement through December
31, 2000, other than fringe benefits involving the payment of money or
stock to the Executive (e.g., payments with respect to a bonus, profit
sharing, retirement, severance or other such plan).
The payments set forth in this paragraph 4 shall be in complete
satisfaction of all obligations owing from the Company of MECA Software
to Executive pursuant to the Agreement, any other employment agreement
between Executive and MECA Software of the Company, or this agreement,
including any obligations to pay interest on such obligations.
In the event MECA Software or the Company shall fail to pay Executive
the lump sum payments set forth hereinabove on the dates specified,
MECA Software or the Company shall pay Executive interest on the unpaid
balance at the rate of ten percent (10%) per annum. In the event
Executive commences litigation or other dispute resolution to enforce
the provisions of this paragraph 4, the losing party in such action
shall pay to the prevailing party such prevailing party's reasonable
attorney's fees and court costs incurred in such action (including any
appeals thereon).
The obligations of MECA or the Company to make the payments set forth in
paragraph 4 hereunder shall not be reduced or otherwise affected as a result of
Executive's death or
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE INFORMATION
CONTAINED WITHIN THE "[**]" MARKINGS. SUCH MARKED PORTIONS HAVE BEEN OMITTED
FROM THIS FILING AND HAVE BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.
2
disability.
With respect to Section 3.02 of the Agreement only, the Covenant Period (as such
term is defined in Section 3.01 of the Agreement) shall mean the period from the
date hereof through December 31, 2001. For all other purposes, the parties
acknowledge that the Covenant Period shall end effective December 31, 2000.
In addition to Executive's obligations set forth in Article Two of the
Agreement, Executive agrees that Executive will not disparage, take any action
to disparage, nor encourage others to disparage, the Company or MECA Software,
or either of their affiliate organizations.
The Company and/or MECA Software agree that after October 1,1999, Executive may
request and neither the Company or MECA Software will unreasonably withhold the
approval of time off to search for new employment.
The Company hereby ratifies all of the terms and conditions of the Agreement
dated December 12,1997 and shall be bound by said Agreement which shall remain
in full force and effect, except as may be modified herein.
The terms and conditions of the within Agreement shall be binding upon
and inure to the benefit of the parties hereto, their heirs, successors and
assigns.
CFI ProServices, Inc.
By: /s/ Xxxxxxx X. Xxxxxxxxx
------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Its: Vice President & General Counsel
MECA Software, L.L.C.
By: /s/ Xxxxxxxx X. Xxxxxxx
------------------------
Name: Xxxxxxxx X. Xxxxxxx
Its: Chief Operating Officer
/s/ Xxxx X. Xxxxxxxx
------------------------
Xxxx X. Xxxxxxxx, Executive
