EXHIBIT 99.1
SEPARATION AND RELEASE AGREEMENT
THIS SEPARATION AND RELEASE AGREEMENT (the "Agreement") is entered into
as of the 30th day of September, 2004 by and between Indus International, Inc.
(hereinafter "Company") and Xxxxxx X. Xxxxxxx, Xx. (hereinafter "Employee").
WHEREAS, Employee is employed by Company in the capacity of Executive
Chairman of the Board, and formerly has been employed in the capacity of Chief
Executive Officer of the Company, pursuant to that Employment Agreement, dated
April 29, 2003 (the "Employment Agreement"); and
WHEREAS, Employee and Company have mutually agreed to a termination of
Employee's employment with the Company; and
WHEREAS, Employee and Company have mutually agreed that the termination
of Employee's employment shall be treated as a termination without "Cause" for
purposes of the Employment Agreement and that the Employment Agreement shall
govern the parties' rights and obligations with respect Employee's resignation,
except as otherwise specifically provided herein;
NOW, THEREFORE, in consideration of the payments, covenants, and
releases described below, and in consideration of other good and valuable
consideration, the receipt and sufficiency of all of which is hereby
acknowledged, Employee and Company agree as follows:
1. Termination of Employment.
Employee and Company agree that Employee's employment with the Company
shall terminate effective as of September 30, 2004 (the "Termination Date").
Employee is not resigning his position on the Board of Directors of Company and
shall continue in his role as Chairman of the Board as a non-employee member of
the Company's Board of Directors. Employee acknowledges and agrees that Company
has met all of its obligations under all agreements, plans, and arrangements
with Employee governing his employment and/or compensation or benefits through
the date of execution of this Agreement. Employee further acknowledges and
admits that he has been paid all wages, bonuses, accrued benefits and other
amounts due to him through the date of execution of this Agreement. The parties
agree that, with the exception of Sections 7(b)(ii) and (iv) of the Employment
Agreement, which are superseded by Sections 2(a)(i) and 2(b) contained herein,
Employee is entitled to the severance benefits provided under Section 7(b) of
the Employment Agreement, and the parties remain bound by the terms and
conditions of the last two sentences of Section 4 of the Employment Agreement
(related to director and officer liability insurance coverage) and Sections 9
through 25 of the Employment Agreement. This Agreement is intended to and does
settle and resolve all claims of whatever nature that Employee might have
against Company for whatever reason as of the date of execution of this
Agreement. The parties agree that, except for payments and
benefits specifically set forth in Section 2 of this Agreement and Section 7 of
the Employment Agreement, the Company does not owe any additional amounts to
Employee for wages, commissions, back pay, severance pay, bonuses, accrued
vacation, benefits, insurance, sick leave, other leave, or any other reason;
provided, that Employee's accrued and unused vacation shall be paid to Employee
on or before October 15, 2004.
2. Severance Payments.
(a) In consideration of Employee's promises and the
Release and Covenant Not To Xxx contained in Paragraph 3 of this Agreement,
Company:
(i) will pay to Employee the aggregate sum of
$600,000 less withholding for taxes and other required items (the "Separation
Pay"), which represents an amount equal to Employee's base salary as of the date
of this Agreement ($250,000), plus an amount equal to Employee's maximum annual
bonus opportunity as of the date of this Agreement ($250,000), plus an
additional $100,000 severance amount. Notwithstanding the provisions of Section
7(b) (ii) of the Employment Agreement, which is specifically superseded hereby,
the Separation Pay shall be paid in equal installments over a period of twelve
(12) months from the Termination Date in accordance with the Company's normal
payroll policies. Such payments shall begin on October 15, 2004, unless Employee
revokes this Agreement prior to that date;
(ii) will reimburse Employee for full COBRA
benefits for Employee, pursuant to Section 7(b)(iii) of the Employment
Agreement. Pursuant to Section 7(b)(iii) of the Employment Agreement, such
payments shall cease when Employee becomes eligible to receive health, medical,
and/or dental benefits from a new employer or on March 31, 2006 (whichever event
occurs earlier). These reimbursements shall be made by the Company on a monthly
basis provided Employee provides reasonable documentation to verify his payment
of the COBRA benefits.
(b) In further consideration of Employee's promises and
the Release and Covenant Not To Xxx contained in Paragraph 3 of this Agreement,
Company agrees, notwithstanding the terms of the Employment Agreement or any
stock option agreement between the Company and Employee, that all of the
Employee's stock options, as set forth on Schedule A hereto, to the extent
unvested on the Termination Date, shall accelerate and become 100% vested and
exercisable on the Termination Date, and all such stock options shall will
remain exercisable until fifteen (15) months from the date employee ceases to be
a Director of the Company. Schedule A attached hereto contains a complete
listing of all stock options held by Employee as of the Termination Date. Except
as modified by this Section 2(b), all of Employee's stock options shall continue
to be governed by the applicable stock option plan and stock option agreement.
This Section 2(b) specifically supersedes Section 7(b)(iv) of the Employment
Agreement. Employee acknowledges and agrees that the provisions of this Section
2(b) shall not apply to any stock options that may be granted by the Company to
Employee subsequent to the Termination Date.
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(c) The parties acknowledge and agree that the above
payments and agreements have been negotiated and agreed upon voluntarily by both
parties. The parties also acknowledge and agree that these amounts exceed any
and all pay and benefits to which Employee already may have been entitled by
contract or law, or for any other reason, and that they constitute good,
valuable and sufficient consideration for Employee's covenants and agreements
contained in this Agreement.
3. Release Of All Claims And Potential Claims Against Company and
Covenant Not To Xxx.
In consideration of the payments made to him by Company and the
promises contained in this Agreement, Employee, on behalf of himself and his
agents and successors in interest, hereby UNCONDITIONALLY RELEASES AND
DISCHARGES Company, and all of its past and present successors, subsidiaries,
parent corporations, members, managers, owners, partners, lenders, advisors,
assigns, affiliated companies, agents, legal representatives, attorneys,
employees, officers, trustees and directors (the "Releases") from all claims,
liabilities, contracts, contractual obligations, attorneys' fees, demands and
causes of action, whether known or unknown, fixed or contingent, that he may
have or claim to have against Company or any of the Releasees for any reason as
of the date of execution of this Agreement, and hereby AGREES NOT TO FILE A
LAWSUIT or other legal claim or charge to assert any claim against any of the
Releasees. This Release and Covenant Not To Xxx includes, but is not limited to,
claims for infliction of emotional distress, claims for defamation, claims for
personal injury of any kind, claims for breach of contract, claims for
harassment and claims arising under federal, state or local laws prohibiting
employment discrimination and claims growing out of any legal restrictions on
Company's rights to terminate its employees or to take any other employment
action, whether statutory, contractual or arising under common law or case law.
Employee specifically acknowledges and agrees that he is releasing, in addition
to all other claims, any and all rights under federal and state employment laws
including without limitation the Age Discrimination in Employment Act of 1967
("ADEA"), as amended, 29 U.S.C. Section 621, et seq., the Civil Rights Act of
1964 ("Title VII"), as amended (including amendments made through the Civil
Rights Act of 1991), 42 U.S.C. Section 2000e, et seq., 42 U.S.C. Section 1981,
as amended, the Americans With Disabilities Act ("ADA"), as amended, 42 U.S.C.
Section 12101, et seq., the Rehabilitation Act of 1973, as amended, 29 U.S.C.
Section 701, et seq., the Employee Retirement Income Security Act of 1974
("ERISA"), as amended, 29 U.S.C. Section 301, et seq., the Worker Adjustment and
Retraining Notification Act, 29 U.S.C. Section 2101, et seq., the Family and
Medical Leave Act of 1993 ("FMLA"), as amended, 29 U.S.C. Section 2601 et seq.,
the Fair Labor Standards Act ("FLSA"), as amended, 29 U.S.C. Section 201 et seq.
the Employee Polygraph Protection Act of 1988, 29 U.S.C. Section 2001, et seq.,
all Georgia Code provisions, all claims under the statutes or common law of any
state, and all state and federal workers' compensation laws. Employee warrants
that he has not filed any type of claim against Company.
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4. Employee Cooperation. Employee agrees, in further
consideration of the above-described payments, that, after the execution of this
Agreement, he will cooperate with and assist Company in the following ways:
(i) by providing information relevant to matters as to
which Employee gained knowledge or with which Employee was involved while
employed by Company (the "Matters");
(ii) by meeting with Company's attorneys and other
representatives, upon reasonable notice from Company, as may reasonably be
requested by Company in the event any legal issues should arise involving such
Matters; and
(iii) by appearing voluntarily at hearings, depositions,
trials and other proceedings relating to such Matters, upon reasonable notice
from Company.
5. Nondisparagement.
In the event Employee ceases to be a non-employee Director of the
Company, Employee agrees and covenants that he will not make any derogatory or
disparaging statements about or relating to Company, its business practices, its
products, its Board of Directors, its employees, or its employment practices for
two (2) years following the date he ceases to be a non-employee Director.
6. Return of Materials.
In the event Employee ceases to be a non-employee Director of the
Company, Employee agrees to promptly return all documents, materials, equipment,
keys, Company credit cards, financial information, customer information, Trade
Secrets (as defined in the Georgia Trade Secrets Act), Confidential Information
(as defined below), sales information, contracts, order information, customer
contact information, correspondence relating to Company, a customer or any
Releasee, computer data and other material and information relating to Company,
any of the Releasees or Company's business and not to retain or provide to
anyone else any copies thereof.
7. Restrictive Covenants. Employee acknowledges and agrees that
he remains subject to the covenants contained in Sections 11 through 16 of the
Employment Agreement and that the Company's payment of the Severance Pay is
fully conditioned upon Employee's compliance with such covenants and the
covenants contained in Paragraphs 4, 5, 6, and 8 hereof (collectively, the
"Restrictive Covenants").
8. Confidentiality of this Agreement.
The provisions of this Agreement shall be held in strictest confidence
by Employee and Company. Employee shall not publicize or disclose it in any
manner whatsoever; provided, however, that Employee may disclose this Agreement:
(a) to Employee's immediate family; (b) to Employee's attorney, accountant, and
financial
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advisor; and (c) as required by order of a court of competent jurisdiction or as
otherwise required by law. Company shall not publicize or disclose it in any
manner whatsoever; provided, however, that Company may disclose this Agreement:
(a) to the Company's Board of Directors in the exercise of their fiduciary
duties; (b) to employees of the Company that have a reasonable need to know in
order for the Company to process payments and to comply with the terms of the
Agreement; (c) to the Company's accountants, lawyers and other advisors to
ensure that the terms of the Agreement are properly treated from an accounting
legal perspective; and (d) as required by order of a court of competent
jurisdiction or as otherwise required by law, including, without limitation, the
federal securities laws.
9. ACKNOWLEDGMENT.
COMPANY HEREBY ADVISES EMPLOYEE TO CONSULT WITH AN ATTORNEY PRIOR TO
EXECUTING THIS AGREEMENT. EMPLOYEE EXPRESSLY ACKNOWLEDGES AND AGREES THAT HE HAS
READ THIS AGREEMENT AND RELEASE CAREFULLY, THAT HE HAS HAD AMPLE TIME AND
OPPORTUNITY TO CONSULT WITH AN ATTORNEY OR OTHER ADVISOR OF HIS CHOOSING
CONCERNING HIS EXECUTION OF THIS AGREEMENT, THAT COMPANY HAS ADVISED HIM, AND
HEREBY DOES ADVISE HIM, OF HIS OPPORTUNITY TO CONSULT AN ATTORNEY OR OTHER
ADVISOR AND HAS NOT IN ANY WAY DISCOURAGED HIM FROM DOING SO, THAT HE FULLY
UNDERSTANDS THAT THE AGREEMENT IS FINAL AND BINDING, THAT IT CONTAINS A RELEASE
OF POTENTIALLY VALUABLE CLAIMS, AND THAT THE ONLY PROMISES OR REPRESENTATIONS HE
HAS RELIED UPON IN SIGNING THIS AGREEMENT ARE THOSE SPECIFICALLY CONTAINED IN
THE AGREEMENT ITSELF. EMPLOYEE ALSO ACKNOWLEDGES AND AGREES THAT HE HAS BEEN
OFFERED AT LEAST TWENTY-ONE (21) DAYS TO CONSIDER THIS AGREEMENT BEFORE SIGNING
AND THAT HE IS SIGNING THIS AGREEMENT VOLUNTARILY, AFTER CONSULTING WITH HIS
ATTORNEY, WITH THE FULL INTENT OF RELEASING COMPANY FROM ALL CLAIMS.
10. Effective Date and Revocation.
This Agreement shall become effective and enforceable at twelve o'clock
(12:00) noon on the eighth (8th) day immediately following the date of execution
of this Agreement. The parties agree that Employee may revoke the Agreement at
will prior to that time by giving written notice of the revocation to Company.
To be effective, the parties agree that such notice of revocation must be
delivered to Xxxx Xxxxxxx, the Company's General Counsel, and must be received
by him at or before the above-mentioned eighth-day deadline. Employee agrees
that, if he revokes the Agreement prior to that time, he will return to Company
any and all payments already received pursuant to this Agreement and that the
Company will have no further obligation to Employee under this Agreement. The
Agreement may not be revoked after that time.
Employee also agrees that if he ever attempts to rescind, revoke or
annul this Agreement after the revocation period or if he attempts at any time
to make, assert or prosecute any claim(s) covered by the Release and Covenant
Not To Xxx contained in Paragraph 3 above, he will, prior to filing or
instituting such claim(s), return to Company any and all payments already
received by him under this Agreement, plus interest at the
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annual rate of ten percent (10%), and, if Company prevails in defending the
enforceability of any portion of the Agreement or in defending itself against
any such claim brought by Employee, he will pay Company's attorney's fees and
costs incurred in defending itself against the claim(s) and/or the attempted
revocation, recission or annulment; provided, however, that Employee shall not
be required to repay the monies paid to him under the terms of this Agreement or
pay Company all of its attorneys' fees and costs incurred in its defense of
Employee's action (except those attorneys' fees specifically authorized under
federal or state law) in the event that Employee seeks only to challenge his
waiver of claims under the ADEA. Nothing in this Agreement shall limit Company's
rights to seek and obtain other remedies for breach of this Agreement.
11. Arbitration.
Company and Employee agree that any dispute arising in connection with,
or relating to, this Agreement or the Employment Agreement, will be resolved
subject to the arbitration requirements set forth in Section 20 of the
Employment Agreement.
12. Governing Law.
This Agreement shall be governed by and construed in accordance with
the laws of the state of Georgia, except the choice of law provisions thereof.
13. Entire Agreement.
The parties agree that this Agreement and the Employment Agreement (as
revised by this Agreement) together are their entire agreement regarding
separation from employment and Employee's release of claims. This Agreement is
intended to be the final statement of the parties' intent regarding Employee's
termination from employment. The parties agree that this Agreement may not be
modified except by a written document signed by both parties expressly stating
that it is intended as an amendment.
14. Severability
With the exception of the release contained in Paragraph 3 above, if
any provision of this Agreement is unenforceable or is held to be unenforceable,
such provision shall be fully severable, and this Agreement and its terms shall
be construed and enforced as if such unenforceable provision had never comprised
a part hereof, the remaining provisions hereof shall remain in full force and
effect, and the court or arbitrator construing the provisions shall add as a
part hereof a provision as similar in terms and effect to such unenforceable
provision as may be enforceable in lieu of the unenforceable provision. In the
event that the release contained in Paragraph 3 above is unenforceable or is
held to be unenforceable, the parties understand and agree that the remaining
provisions of the Agreement shall be rendered null and void and that neither
party shall have any further obligation under any provision of this Agreement.
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The parties hereby agree to all of the above terms and signify their
agreement by their signatures on this page.
IN WITNESS WHEREOF, the parties hereto have caused this Separation
Agreement to be duly executed as of the day and year first above written.
INDUS INTERNATIONAL, INC.
By: /s/ Xxxxxx X. Xxxxxxxx, Xx.
-----------------------------------------
Name: Xxxxxx X. Xxxxxxxx, Xx.
Title: Executive Vice President and
Chief Financial Officer
Date: September 30, 2004
THE EMPLOYEE
/s/ Xxxxxx X. Xxxxxxx, Xx.
----------------------------------------------
Xxxxxx X. Xxxxxxx, Xx.
Date: September 28, 2004
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SCHEDULE A - STOCK OPTIONS
GRANT DATE PLAN #OPTIONS EXERCISE PRICE
---------- ---- -------- --------------
4/24/01 1997 Director Option Plan 50,000 $4.13
3/4/02 1997 Stock Plan 446,000 $5.40
7/10/02 1997 Stock Plan 450,000 $1.38
Total: 946,000
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