1
EXHIBIT 10.22
EMPLOYMENT AGREEMENT
THIS AGREEMENT is entered into on January 22, 2001, by and between
XXXX XXXXXX (the "Employee"), an individual residing at the address set forth on
the signature page hereof, and HYPERION SOLUTIONS CORPORATION, a Delaware
corporation (the "Company").
1. DUTIES AND SCOPE OF EMPLOYMENT.
(a) POSITION. For the term of his employment under this Agreement
("Employment"), the Company agrees to employ the Employee in the position of
Vice President, General Counsel or in such other position as the Company
subsequently may assign to the Employee. The Employee shall report to the
Company's Chief Executive Officer or to such other person as the Company
subsequently may determine.
(b) OBLIGATIONS TO THE COMPANY. During the term of his Employment,
the Employee shall devote his full business efforts and time to the Company.
During the term of his Employment, without the prior written approval of the
Company (which shall not be unreasonably withheld), the Employee shall not
render services in any capacity to any other person or entity and shall not act
as a sole proprietor, partner or managing member of any other person or entity
or as a shareholder owning more than one percent of the stock of any other
corporation. The foregoing, however, shall not preclude the Employee from
engaging in reasonable community, school or charitable activities. The Employee
shall comply with the Company's policies and rules, as they may be in effect
from time to time during the term of his Employment.
(c) NO CONFLICTING OBLIGATIONS. The Employee represents and
warrants to the Company that he is under no obligations or commitments, whether
contractual or otherwise, that are inconsistent with his obligations under this
Agreement. The Employee represents and warrants that he will not use or
disclose, in connection with his employment by the Company, any trade secrets or
other proprietary information or intellectual property in which he or any other
person has any right, title or interest and that his employment by the Company
as contemplated by this Agreement will not infringe or violate the rights of any
other person. The Employee represents and warrants to the Company that he has
returned all property and confidential information belonging to any prior
employer.
2. CASH AND INCENTIVE COMPENSATION.
(a) SALARY. The Company shall pay the Employee as compensation for
his services a base salary at a gross annual rate of not less than $212,000.
Such salary shall be payable in accordance with the Company's standard payroll
procedures. (The annual compensation specified in this Subsection (a), together
with any increases in such compensation that the Company may grant from time to
time, is referred to in this Agreement as "Base Compensation.").
2
(b) INCENTIVE BONUSES. The Employee shall be eligible to be
considered for an annual incentive bonus with a target amount equal to 50% of
his Base Compensation. Such bonus (if any) shall be awarded based on objective
or subjective criteria established in advance by the Company's Board of
Directors (the "Board") or its Compensation Committee. The determinations of the
Board or such Committee with respect to such bonus shall be final and binding.
3. EMPLOYEE BENEFITS. During the term of his Employment, the
Employee shall be eligible to participate in any employee benefit plans
maintained by the Company for similarly situated employees, subject in each case
to the generally applicable terms and conditions of the plan in question and to
the determinations of any person or committee administering such plan.
In addition to providing the foregoing benefits to Employee, the
Company shall:
(i) reimburse the Employee for the reasonable and customary cost
of an annual physical examination.
(ii) provide to the Employee certain income tax services.
PricewaterhouseCoopers will prepare and sign the Employee's individual
income tax returns and provide the Employee with estimated tax
calculations. In addition, the tax professionals at
PricewaterhouseCoopers will provide the Employee with income tax
projections to help Employee develop his or her personal financial goals
and strategies, including planning for the exercise and/or sale of
option stock.
4. BUSINESS EXPENSES. During the term of his Employment, the
Employee shall be authorized to incur necessary and reasonable travel,
entertainment and other business expenses in connection with his duties
hereunder. The Company shall reimburse the Employee for such expenses upon
presentation of an itemized account and appropriate supporting documentation,
all in accordance with the Company's generally applicable policies. Any single
expenditure in excess of $10,000 shall require the prior approval of the
Company's Chief Executive Officer, President or Chief Financial Officer.
5. TERM OF EMPLOYMENT.
(a) BASIC RULE. The Company agrees to continue the Employee's
Employment, and the Employee agrees to remain in Employment with the Company,
from the Effective Time until the earlier of:
(i) The close of the applicable Initial Term or Renewal Period,
as determined under Subsection (b) below; or
(ii) The date when the Employee's Employment terminates pursuant
to Subsection (c) below.
2
3
(b) INITIAL TERM AND RENEWAL PERIODS. The initial term of this
Agreement shall end on January 31, 2003 (the "Initial Term"). Thereafter this
Agreement shall automatically be renewed for successive 12-month periods (the
"Renewal Periods"), unless either party has given the other party written notice
of non-renewal not less than 90 days prior to the close of the Initial Term or
Renewal Period then in effect.
(c) EARLY TERMINATION. The Employee may terminate his Employment
at any time and for any reason (or no reason) by giving the Company 30 days'
advance notice in writing. The Company may terminate the Employee's Employment
at any time and for any reason (or no reason), and with or without Cause, by
giving the Employee 30 days' advance notice in writing. The Company may also
terminate the Employee's active Employment due to Permanent Disability by giving
the Employee notice in writing. For all purposes under this Agreement,
"Permanent Disability" shall mean that the Employee, at the time notice is
given, has failed to perform his duties under this Agreement for 60 or more
consecutive days or for 90 or more days during any 12-month period as the result
of his incapacity due to physical or mental injury, disability or illness and
which the Company is unable to accommodate reasonably without undue hardship.
The Employee's Employment shall terminate automatically in the event of his
death.
(d) RIGHTS AND OBLIGATIONS UPON TERMINATION. Except as expressly
provided in Section 6, upon the termination of the Employee's Employment
pursuant to this Section 5, the Employee shall only be entitled to the
compensation, benefits and reimbursements described in Sections 2, 3 and 4 for
the period preceding the effective date of the termination. No incentive bonus
under Section 2(b) shall be payable for the year in which the Employee's
Employment terminates, unless the applicable bonus program expressly provides
for the payment of a prorated bonus for such year. The payments under this
Agreement shall fully discharge all responsibilities of the Company to the
Employee. The termination of this Agreement shall not limit or otherwise affect
the Employee's obligations under Section 7.
6. TERMINATION BENEFITS.
(a) GENERAL RELEASE. Any other provision of this Agreement
notwithstanding, Subsections (b) and (c) below shall not apply unless the
Employee has executed a general release (in a form prescribed by the Company) of
all known and unknown claims that he may then have against the Company or
persons affiliated with the Company. Such release shall include, among other
things, an agreement not to prosecute any legal action or other proceeding based
upon any of such claims. The Employee acknowledges that such release may provide
that in the event of a breach by the Employee of the terms of the release or of
Employee's obligations under Section 7 hereof, the Company shall be entitled to
recover from the Employee all amounts paid under subsections (b) and (c) of this
Section 6, as well as all litigation costs (including attorneys' fees and
expenses) incurred by the Company in connection with such breach.
(b) SEVERANCE PAY. The Company shall pay the Employee his Base
Compensation for a 12-month period following the effective date of the
termination of his Employment (the "Continuation Period") if:
3
4
(i) The Company terminates the Employee's Employment under
Section 5(c) for any reason other than Cause or Permanent Disability; or
(ii) The Company was subject to a Corporate Transaction/Change
in Control during the term of this Agreement and, within 12 months
thereafter, the Employee resigns for Good Reason.
(iii) During the term of this Agreement, the current Chief
Executive Officer ("CEO") ceases to serve as the senior executive
officer of the Company, the Company's Board of Directors appoints a new
CEO and within six months of the first day of such new CEO's employment
with the Company, the Employee resigns because the Company has
significantly diminished the nature or scope of the Employee's
authority, duties or responsibilities in effect immediately prior to the
appointment of the new CEO.
Base Compensation under this Subsection (b) shall be paid at the rate in effect
at the time of the termination of Employment and in accordance with the
Company's standard payroll procedures.
(c) EMPLOYEE BENEFITS. If Subsection (b) above applies, the
Company shall continue the coverage of the Employee and his dependents (if
applicable) under the employee benefit plans described in Section 3 during the
Continuation Period. To the extent that such plans or the insurance contracts or
provider agreements associated with such plans do not permit the extension of
the Employee's coverage following the termination of his active employment, the
Company shall pay the Employee cash in an amount equal to the cost to the
Company of the coverage that cannot be provided. The cash payments shall be made
in accordance with Subsection (b) above.
(d) COBRA. If Subsection (b) above applies, and if the Employee
elects to continue his health insurance coverage under the Consolidated Omnibus
Budget Reconciliation Act ("COBRA") following the termination of his Employment,
then the date of the "qualifying event" for purposes of COBRA shall be the
Employee's last day of active employment.
(e) DEFINITION OF "CAUSE." For all purposes under this Agreement,
"Cause" shall mean:
(i) The Employee's failure to perform in a satisfactory fashion
one or more reasonable and lawful duties assigned to the Employee by the
Company under this Agreement, if such failure continues for seven days
or more after the Company has given the Employee written notice
describing such failure and advising him of the consequences of such
failure under this Agreement; provided that such notice shall be
required only with respect to the first such failure;
4
5
(ii) The Employee's misconduct relating to the Company's
affairs, if such misconduct continues for seven days or more after the
Company has given the Employee written notice describing such misconduct
and advising him of the consequences of such misconduct under this
Agreement; provided that such notice shall be required only with respect
to the first occurrence of such misconduct; provided further there shall
be no requirement that the misconduct continue for seven days or more
with respect to acts for which an employee's employment is specifically
terminable under the Company's policies and procedures applicable to all
employees;
(iii) The Employee's conviction of, or a plea of "guilty" or "no
contest" to, a felony, or a misdemeanor which calls into question the
Employee's honesty, under the laws of the United States or any state
thereof;
(iv) Any breach of this Agreement, the Employee Proprietary
Information Agreement between the Employee and the Company, or any other
agreement between the Employee and the Company;
(v) Threats or acts of violence or harassment directed at any
present, former or prospective employee, independent contractor, vendor,
customer or business partner of the Company; or
(vi) Fraud or embezzlement involving the assets of the Company
or its affiliates, customers or suppliers.
The foregoing shall not be deemed an exclusive list of all acts or omissions
that the Company may consider as grounds for the termination of the Employee's
Employment with Cause. Termination for Cause hereunder shall be deemed to be
termination for "Misconduct" under the Company's stock option plans and related
agreements.
(f) DEFINITION OF "CORPORATE TRANSACTION/CHANGE IN CONTROL." For
all purposes under this Agreement, "Corporate Transaction/Change in Control"
shall mean any transaction under clauses (i) or (ii) below:
(i) a change in ownership or control of the Company effected
through either of the following transactions:
(A) the acquisition, directly or indirectly, by any
person or related group of persons (other than the Company or a
person that directly or indirectly controls, is controlled by,
or is under common control with, the Company), of beneficial
ownership (within the meaning of Rule 13d-3 of the 0000 Xxx) of
securities possessing more than fifty percent (50%) of the total
combined voting power of the Company's outstanding securities
pursuant to a tender or exchange offer made directly to the
Company's stockholders which the Board does not recommend such
stockholders to accept, or
5
6
(B) a change in the composition of the Board over a
period of thirty-six (36) consecutive months or less such that a
majority of the Board members ceases, by reason of one or more
contested elections for Board membership, to be comprised of
individuals who either (A) have been Board members continuously
since the beginning of such period or (B) have been elected or
nominated for election as Board members during such period by at
least a majority of the Board members described in clause (A)
who were still in office at the time the Board approved such
election or nomination,
(ii) either of the following stockholder-approved transactions
to which the Company is a party:
(A) a merger or consolidation in which securities
possessing more than fifty percent (50%) of the total combined
voting power of the Company's outstanding securities are
transferred to a person or persons different from the persons
holding those securities immediately prior to such transaction;
or
(B) the sale, transfer or other disposition of all or
substantially all of the Company's assets in complete
liquidation or dissolution of the Company.
(g) DEFINITION OF "GOOD REASON." For all purposes under this
Agreement, "Good Reason" shall mean:
(i) A change in Employee's position with the Company which
materially reduces his or her level of responsibility in effect
immediately prior to the Corporate Transaction/Change in Control;
(ii) A reduction in Employee's level of compensation (including
base salary, fringe benefits and participation in corporate-performance
based bonus or incentive programs) in effect immediately prior to the
Corporate Transaction/Change in Control by more than fifteen percent
(15%); or
(iii) A relocation of Employee's place of employment prior to
the Corporate Transaction/Change in Control by more than fifty (50)
miles, provided and only if such change, reduction or relocation is
effected by the Company without Employee's consent.
7. EMPLOYEE'S COVENANTS.
(a) NON-SOLICITATION OF EMPLOYEES. During the period commencing on
the date of this Agreement and continuing until the second anniversary of the
date when the Employee's Employment terminated for any reason, the Employee
shall not interfere with the business of the Company by, directly or indirectly,
personally or through others, soliciting or attempting to solicit (on the
Employee's own behalf or on behalf of any other person or entity) the employment
of any employee of the Company or any of the Company's affiliates. During such
period, the Employee shall not encourage or induce, or take any action that has
the effect of
6
7
encouraging or inducing, any employee of the Company or any of the Company's
affiliates to terminate his or her employment.
(b) LIMITATION ON HIRING OF EMPLOYEES. For a period of 120 days
following the date when the Employee's Employment terminated for any reason, the
Employee shall not hire, or assist any other person in hiring, any person who
was an employee of the Company on the date when the Employee's Employment
terminated to work at the Employee's new place of employment in a position that
reports either directly to the Employee or to any other person who reports
directly to the Employee.
(c) NON-SOLICITATION OF CUSTOMERS. The parties agree that
information relating to the identities, key contact personnel, preferences,
needs and circumstances of the Company's customers are trade secrets belonging
to the Company that are, and necessarily will be, used by the Employee in the
solicitation of business from the Company's customers. As a result, during the
period commencing on the date of this Agreement and continuing until the second
anniversary of the date when the Employee's Employment terminated for any
reason, the Employee shall not, directly or indirectly, personally or through
others, solicit or attempt to solicit (on the Employee's own behalf or on behalf
of any other person or entity) the business of any customer or prospective
customer, of the Company, or of any of the Company's affiliates, for services or
products similar to those sold by the Company. For purposes of this provision, a
"prospective customer" shall mean any person or entity whom the Employee was
involved in contacting or soliciting to become a customer during the six month
period prior to the termination of the Employee's Employment.
(d) NON-DISPARAGEMENT. Commencing on the date when the Employee's
Employment terminated for any reason and continuing thereafter, the Employee
shall not directly or indirectly, personally or through others, disparage the
Company or any of its predecessors, including each of their past, current, or
future board of directors or senior management or any of their products or
services.
(e) INJUNCTIVE RELIEF. The Employee acknowledges and agrees that
his failure to perform any of his covenants in this Section 7 would cause
irreparable injury to the Company and cause damages to the Company that would be
difficult or impossible to ascertain or quantify. Accordingly, without limiting
any other remedies that may be available with respect to any breach of this
Agreement, the Employee consents to the entry of an injunction to restrain any
breach of this Section 7.
(f) SURVIVAL. The covenants in this Section 7 shall survive any
termination or expiration of this Agreement and the termination of the
Employee's Employment with the Company for any reason.
8. SUCCESSORS.
(a) COMPANY'S SUCCESSORS. This Agreement shall be binding upon any
successor (whether direct or indirect and whether by purchase, lease, merger,
consolidation, liquidation or otherwise) to all or substantially all of the
Company's business and/or assets. For
7
8
all purposes under this Agreement, the term "Company" shall include any
successor to the Company's business and/or assets which becomes bound by this
Agreement.
(b) EMPLOYEE'S SUCCESSORS. This Agreement and all rights of the
Employee hereunder shall inure to the benefit of, and be enforceable by, the
Employee's personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees.
9. MISCELLANEOUS PROVISIONS.
(a) NOTICE. Notices and all other communications contemplated by
this Agreement shall be in writing and shall be deemed to have been duly given
when (i) personally delivered, (ii) delivered to the U.S. Postal Service for
delivery by registered or certified mail or (iii) delivered to a comparable
private service offering guaranteed deliveries in the ordinary course of its
business. Notice under clauses (ii) and (iii) shall be valid only if delivery
charges have been prepaid and a return receipt will be furnished. In the case of
the Employee, notice under clauses (ii) and (iii) shall be addressed to him at
the home address which he most recently communicated to the Company in writing.
In the case of the Company, notice under clauses (ii) and (iii) shall be
addressed to its corporate headquarters and directed to the attention of its
Secretary.
(b) MODIFICATIONS AND WAIVERS. No provision of this Agreement
shall be modified, waived or discharged unless the modification, waiver or
discharge is agreed to in writing and signed by the Employee and by an
authorized officer of the Company (other than the Employee). No waiver by either
party of any breach of, or of compliance with, any condition or provision of
this Agreement by the other party shall be considered a waiver of any other
condition or provision or of the same condition or provision at another time.
(c) WHOLE AGREEMENT. This Agreement supersedes any prior
employment agreement between the Employee and the Company. No other agreements,
representations or understandings (whether oral or written and whether express
or implied) which are not expressly set forth in this Agreement have been made
or entered into by either party with respect to the subject matter hereof. This
Agreement and the Employee Proprietary Information Agreement between the
Employee and the Company contain the entire understanding of the parties with
respect to the subject matter hereof.
(d) WITHHOLDING TAXES. All payments made under this Agreement
shall be subject to reduction to reflect taxes or other charges required to be
withheld by law.
(e) CHOICE OF LAW. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of the State of
Connecticut without regard to its choice of law principles.
(f) SEVERABILITY. The invalidity or unenforceability of any
provision or provisions of this Agreement shall not affect the validity or
enforceability of any other provision hereof, which shall remain in full force
and effect.
8
9
(g) ARBITRATION. Subject to Section 7(g), any controversy or claim
arising out of or relating to this Agreement or the breach thereof, or the
Employee's Employment or the termination thereof, shall be settled in Fairfield
County, Connecticut, by arbitration in accordance with the National Rules for
the Resolution of Employment Disputes of the American Arbitration Association.
The decision of the arbitrator shall be final and binding on the parties, and
judgment on the award rendered by the arbitrator may be entered in any court
having jurisdiction thereof. The parties hereby agree that the arbitrator shall
be empowered to enter an equitable decree mandating specific enforcement of the
terms of this Agreement. The Company and the Employee shall share equally all
fees and expenses of the arbitrator; provided, however, that the Company or the
Employee, as the case may be, shall bear all fees and expenses of the arbitrator
and all of the legal fees and out-of-pocket expenses of the other party if the
arbitrator determines that the claim or position of the Company or the Employee,
as the case may be, was without reasonable foundation. The Employee hereby
consents to personal jurisdiction of the state and federal courts located in the
State of Connecticut for any action or proceeding arising from or relating to
this Agreement or relating to any arbitration in which the parties are
participants.
(h) NO ASSIGNMENT. This Agreement and all rights and obligations
of the Employee hereunder are personal to the Employee and may not be
transferred or assigned by the Employee at any time. The Company may assign its
rights under this Agreement to any entity that assumes the Company's obligations
hereunder in connection with any sale or transfer of all or a substantial
portion of the Company's assets to such entity.
(i) COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
(j) GENDER. The masculine, feminine and neuter gender, and the
singular or plural number, shall be deemed to include the others whenever the
context so indicates.
9
10
IN WITNESS WHEREOF, each of the parties has executed this Agreement,
in the case of the Company by its duly authorized officer, as of the day and
year first above written.
/s/ Xxxx Xxxxxx
------------------------------
Xxxx Xxxxxx
HYPERION SOLUTIONS CORPORATION
By: /s/ Xxxxxxx Xxxxx
-----------------------
Name: Xxxxxxx Xxxxx
-----------------------
Title: Chairman and Chief
Executive Officer
-----------------------
10
