SEVERANCE AGREEMENT
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THIS AGREEMENT dated as of October 21, 2003 is made by and
between SYSTEMS & COMPUTER TECHNOLOGY CORPORATION, a Delaware corporation (the
"Company"), and Xxxxx Xxxxxxx (the "Executive").
WHEREAS, the Company considers it essential to the best
interests of its stockholders to xxxxxx the continuous employment of key
management personnel; and
WHEREAS, the Board of Directors of the Company (the "Board")
recognizes that, as is the case with many publicly held corporations, the
possibility of a Change in Control (as defined in the last Section hereof)
exists and that such possibility, and the uncertainty and questions which it may
raise among management, may result in the departure or distraction of management
personnel to the detriment of the Company and its stockholders; and
WHEREAS, the Board has determined that appropriate steps
should be taken to reinforce and encourage the continued attention and
dedication of members of the Company's management, including the Executive, to
their assigned duties without distraction in the face of potentially disturbing
circumstances arising from the possibility of a Change in Control;
NOW, THEREFORE, in consideration of the premises and the
mutual covenants herein contained, the Company and the Executive hereby agree as
follows:
1. Defined Terms. The definition of capitalized terms used in
this Agreement is provided in the last Section hereof.
2. Term of Agreement.
2.1. This Agreement shall commence on the date hereof and
shall continue in effect through December 31, 2004; provided, however, that
commencing on January 1, 2005 and each January 1 thereafter, the term of this
Agreement shall automatically be extended for one additional year unless, not
later than September 30 of the preceding year, the Company or the Executive
shall have given notice not to extend this Agreement or a Change in Control
shall have occurred prior to such January 1; and further provided, however, if a
Change in Control shall have occurred during the term of this Agreement, this
Agreement shall continue in effect for a period ending on the last day of the
twenty-fourth calendar month beginning after the month in which such Change in
Control occurred.
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2.2. During the initial term of this Agreement or any
subsequent renewal term of this Agreement, if, prior to a Change in Control, the
Executive ceases to be employed in the position of Executive Vice President,
Field Operations, but remains employed by the Company in a non-executive
position, this Agreement shall be deemed to have terminated as of the date the
Executive ceases to be employed in an executive position; provided, however, the
Board, in its sole discretion, may designate that this Agreement shall remain in
effect with respect to the Executive's subsequent position with the Company,
and, in the event of this designation, the Company and the Executive shall
continue to be bound by the terms of this Agreement. Notwithstanding the
foregoing, this Section 2.2 shall not apply if the Executive ceases to be
employed in an executive position as a result of any action taken by the Company
in consultation with a Person with whom the Company has entered into an
agreement the consummation of which will constitute a Change in Control or if
the Executive terminates his employment with Good Reason prior to a Change in
Control (determined by treating a Potential Change in Control as a Change in
Control in applying the definition of Good Reason under Section 15(I)(i) through
(vii) hereof) if the circumstance or event that constitutes Good Reason occurs
at the direction of such Person.
3. Company's Covenants Summarized. To induce the Executive to
remain in the employ of the Company and in consideration of the Executive's
covenants set forth in Section 4 hereof, the Company agrees, under the
conditions described herein, to pay the Executive the Severance Payments
described in Section 6.1 hereof and the other payments and benefits described
herein in the event the Executive's employment with the Company is terminated
following a Change in Control and during the term of this Agreement. Except as
provided in Section 9.1 hereof, no amount or benefit shall be payable under this
Agreement unless there shall have been (or, pursuant to Section 6.1 hereof,
there shall be deemed to have been) a termination of the Executive's employment
with the Company following a Change in Control. This Agreement shall not be
construed as creating an express or implied contract of employment and, except
as otherwise agreed in writing between the Executive and the Company, the
Executive shall not have any right to be retained in the employ of the Company.
4. The Executive's Covenants.
4.1. The Executive agrees that, subject to the terms and
conditions of this Agreement, in the event of a Potential Change in Control
during the term of this Agreement, the Executive will remain in the employ of
the Company until the earliest of (i) a date which is six (6) months from the
date of such Potential Change in Control, (ii) the date of a Change in Control,
(iii) the date of termination by the Executive of the Executive's employment for
Good Reason (determined by treating the Potential Change in Control as a Change
in Control in applying the definition of Good Reason under Section 15(I)(i)
through (vii) hereof) or by reason of death, Disability or retirement, or (iv)
the termination by the Company of the Executive's employment for any reason.
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4.2. While the Executive is employed by the Company and for
a period of one year after the effective date of Executive's termination of
employment if Executive's employment is terminated following a Change in Control
and Executive becomes entitled to receive any payment under Section 6.1 of this
Agreement, the Executive covenants and agrees that he will not, whether for
himself or for any other person, business, partnership, association, firm,
company or corporation, directly or indirectly, call upon, solicit, divert or
take away or attempt to solicit, divert or take away, any of the customers or
employees of the Company that are or were customers or employees at any time
during his employment with the Company. The Executive acknowledges that the
Company would be irreparably injured by a violation of this Section 4.2, and
agrees that the Company, in addition to other remedies available to it for such
breach or threatened breach, shall be entitled to a preliminary injunction,
temporary restraining order or other equitable relief restraining the Executive
from any actual or threatened breach of this Section 4.2 without any bond or
other security being required.
5. Compensation Other Than Severance Payments.
5.1. Following a Change in Control and during the term of
this Agreement, during any period that the Executive fails to perform the
Executive's full-time duties with the Company as a result of incapacity due to
physical or mental illness, the Company shall pay the Executive's full salary to
the Executive at the rate in effect at the commencement of any such period,
together with all compensation and benefits payable to the Executive under the
terms of any compensation or benefit plan, program or arrangement maintained by
the Company during such period, until the Executive's employment is terminated
by the Company for Disability.
5.2. If the Executive's employment shall be terminated for
any reason following a Change in Control and during the term of this Agreement,
the Company shall pay the Executive's full salary to the Executive through the
Date of Termination at the rate in effect at the time the Notice of Termination
is given, together with all compensation and benefits (other than severance and
comparable benefits and payments) payable to the Executive through the Date of
Termination under the terms of any compensation or benefit plan, program or
arrangement maintained by the Company during such period.
5.3. In the event of a Change in Control, all options to
purchase securities of the Company held by the Executive shall immediately vest
on such date and shall become immediately and fully exercisable.
5.4. If the Executive's employment shall be terminated for
any reason following a Change in Control and during the term of this Agreement,
the Company will provide the Executive with an executive outplacement counseling
program through an outplacement services firm designated by the Company for a
period of one year following the date of termination of employment at no fee to
the Executive.
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5.5. If the Executive's employment shall be terminated for
any reason following a Change in Control and during the term of this Agreement,
the Company shall pay the Executive's normal post-termination compensation and
benefits (other than severance and comparable benefits and payments) to the
Executive when such payments become due. Such post-termination compensation and
benefits shall be determined under, and paid in accordance with, the Company's
retirement, insurance and other similar programs and arrangements (other than
severance and comparable programs and arrangements).
6. Severance Payments.
6.1. The Company shall pay the Executive the payments
described in this Section 6.1 (the "Severance Payments") upon the termination of
the Executive's employment following a Change in Control and during the term of
this Agreement, in addition to the payments and benefits described in Section 5
hereof, unless such termination is (i) by the Company for Cause, (ii) by reason
of death or Disability, or (iii) by the Executive without Good Reason. The
Executive's employment shall be deemed to have been terminated, following a
Change in Control by the Company without Cause or by the Executive with Good
Reason if the Executive's employment is terminated prior to a Change in Control
without Cause after consultation with a Person who has entered into an agreement
with the Company the consummation of which will constitute a Change in Control
or if the Executive terminates his employment with Good Reason prior to a Change
in Control (determined by treating a Potential Change in Control as a Change in
Control in applying the definition of Good Reason under Section 15(I)(i) through
(vii) hereof) if the circumstance or event that constitutes Good Reason occurs
at the direction of such Person.
(A) In lieu of any further salary payments to the
Executive for periods subsequent to the Date of Termination and in lieu of any
severance benefit otherwise payable to the Executive, the Company shall pay to
the Executive a lump sum severance payment, in cash, equal to the sum of (i) the
higher of the Executive's annual base salary in effect immediately prior to the
occurrence of the event or circumstance upon which the Notice of Termination is
based or such salary in effect immediately prior to the Change in Control, and
(ii) the target bonus for the year in which the Notice of Termination is
provided pursuant to the Company's Bonus Plan or any successor thereto (the
"Bonus Plan"), less any portion thereof previously paid and less any portion
thereof payable pursuant to Section 6.1 (B) hereof.
(B) Notwithstanding any provision of the Bonus Plan,
the Company shall pay to the Executive a lump sum amount, in cash, equal to the
sum of (i) any bonus amount which has been allocated or awarded to the Executive
for a completed fiscal year or other measuring period preceding the Date of
Termination under the Bonus Plan but has not yet been paid (pursuant to Section
5.2 hereof or otherwise) and (ii) a pro rata portion to the Date of Termination
of the aggregate value of all contingent bonus awards to the Executive for all
uncompleted periods under the Bonus Plan calculated as to each such award by
assuming the achievement of the target performance level within the performance
range established with respect to such award and basing such pro-rata portion
upon the portion of the award period that has elapsed as of the Date of
Termination;
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(C) For a twelve (12) month period after the Date of
Termination the Company shall arrange to provide the Executive with life,
disability, accident and health insurance benefits substantially similar to
those which the Executive is receiving immediately prior to the Notice of
Termination (without giving effect to any reduction in such benefits subsequent
to a Change in Control if such reduction constitutes Good Reason). Benefits
otherwise receivable by the Executive pursuant to this Section 6.1(C) shall be
reduced to the extent comparable benefits are actually received by or made
available to the Executive without cost during the above-referenced period. In
addition, any such benefits actually received by the Executive shall be reported
to the Company by the Executive.
6.2. Payments under Section 6.1 will be made without regard
to whether the deductibility of such payments (or any other payments) would be
limited or precluded by Section 280G of the Internal Revenue Code of 1986 (the
"Code") and without regard to whether such payments would subject the Executive
to the federal excise tax levied on "excess parachute payments" under Section
4999 of the Code; provided, however, that if the Total After-Tax Payments (as
defined below) would be increased by the limitation or elimination of any amount
payable under Section 6.1, then the amount payable under Section 6.1 will be
reduced to the extent necessary to maximize the Total After-Tax Payments. For
purposes of this Agreement, "Total After-Tax Payments" means the total of all
"parachute payments" (as that term is defined in Section 280G(b)(2) of the Code)
made to or for the benefit of Executive (whether made hereunder or otherwise),
after reduction for all applicable federal taxes (including, without limitation,
the tax described in Section 4999 of the Code).
6.3. The payments provided for in Section 6.1 hereof (other
than Section 6.1(C)) shall be made not later than the fifth day following the
Date of Termination.
6.4. The Company also shall pay to the Executive all legal
fees and expenses incurred in good faith by the Executive as a result of a
termination of the Executive's employment following a Change in Control and
during the term of this Agreement. For purposes of this Section 6.4, an
Executive shall be deemed to have acted in good faith unless an arbitrator finds
that the Executive's action resulting in such legal fees and expenses was
frivolous. Such payments shall be made within five (5) business days after
delivery of the Executive's written request for payment accompanied with such
evidence of fees and expenses incurred as the Company reasonably may require.
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7. Termination Procedures and Compensation During Dispute.
7.1. After a Change in Control and during the term of this
Agreement, any purported termination of the Executive's employment (other than
by reason of death) shall be communicated by written Notice of Termination from
one party hereto to the other party hereto in accordance with Section 10 hereof.
For purposes of this Agreement, a "Notice of Termination" shall mean a notice
which shall indicate the specific termination provision in this Agreement relied
upon and shall set forth in reasonable detail the facts and circumstances
claimed to provide a basis for termination of the Executive's employment under
the provision so indicated.
7.2. "Date of Termination," with respect to any purported
termination of the Executive's employment after a Change in Control and during
the term of this Agreement, shall mean (i) If the Executive's employment is
terminated for Disability, thirty (30) days after Notice of Termination is given
(provided that the Executive shall not have returned to the full-time
performance of the Executive's duties during such thirty (30) day period), and
(ii) if the Executive's employment is terminated for any other reason, the date
specified in the Notice of Termination (which, in the case of a termination by
the Company, shall not be less than thirty (30) days (except in the case of a
termination for Cause) and, in the case of a termination by the Executive, shall
not be less than fifteen (15) days nor more than sixty (60) days from the date
such Notice of Termination is given).
7.3. If prior to the Date of Termination (as determined
without regard to this Section 7.3), either party notifies the other party that
a dispute exists concerning the termination, the Date of Termination shall be
the date on which the dispute is finally resolved, either by mutual written
agreement of the parties or by a final judgment, order or decree of a court of
competent jurisdiction (which is not appealable or with respect to which the
time for appeal therefrom has expired and no appeal has been perfected);
provided, however, that the Date of Termination shall be extended by a notice of
dispute provided by the Executive only if such notice is given in good faith and
the Executive pursues the resolution of such dispute with reasonable diligence.
7.4. If a purported termination occurs following a Change
in Control and during the term of this Agreement, and such termination is
disputed in accordance with Section 7.3 hereof, the Company shall continue to
pay the Executive the full compensation in effect when the notice giving rise to
the dispute was given (including, but not limited to, salary) and continue the
Executive as a participant in all compensation, benefit and insurance plans in
which the Executive was participating when the notice giving rise to the dispute
was given until the Date of Termination, determined in accordance with Section
7.3 hereof. Amounts paid under this Section 7.4 are in addition to all other
amounts due under this Agreement (other than those due under Section 5.2 hereof)
and shall not be offset against or reduce any other amounts due under this
Agreement.
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8. No Mitigation. The Company agrees that if the Executive's
employment by the Company is terminated during the term of this Agreement, the
Executive is not required to seek other employment or to attempt in any way to
reduce any amounts payable to the Executive by the Company pursuant to this
Agreement. Further, the amount of any payment or benefit provided for in this
Agreement (other than Section 6.1(C)) shall not be reduced by any compensation
earned by the Executive as the result of employment by another employer, by
retirement benefits, by offset against any amount claimed to be owed by the
Executive to the Company, or otherwise.
9. Successors; Binding Agreement.
9.1. In addition to any obligations imposed by law upon any
successor to the Company, the Company will require any successor (whether direct
or indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business or assets of the Company to expressly assume
and agree to perform this Agreement in the same manner and to the same extent
that the Company would be required to perform it if no such succession had taken
place. Failure of the Company to obtain such assumption and agreement prior to
the effectiveness of any such succession shall be a breach of this Agreement and
shall entitle the Executive to compensation from the Company in the same amount
and on the same terms as the Executive would be entitled to hereunder if the
Executive were to terminate the Executive's employment for Good Reason after a
Change in Control, except that, for purposes of implementing the foregoing, the
date on which any such succession becomes effective shall be deemed the Date of
Termination.
9.2. This Agreement shall inure to the benefit of and be
enforceable by the Executive's personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees. If the
Executive shall die while any amount would still be payable to the Executive
hereunder (other than amounts which, by their terms, terminate upon the death of
the Executive) if the Executive had continued to live, all such amounts, unless
otherwise provided herein, shall be paid in accordance with the terms of this
Agreement to the executors, personal representatives or administrators of the
Executive's estate.
10. Notices. For the purpose of this Agreement, notices and
all other communications provided for in the Agreement shall be in writing and
shall be deemed to have been duly given when personally delivered or mailed by
United states registered mail, return receipt requested, postage prepaid,
addressed to the respective addresses set forth below, or to such other address
as either party may have furnished to the other in writing in accordance
herewith, except that notice of change of address shall be effective only upon
actual receipt:
To the Company:
Systems & Computer Technology Corporation
0 Xxxxxxx Xxxx Xxxx
Xxxxxxx, XX 00000
Attention: Chairman and Chief Executive Officer
To the Executive:
Xxxxx Xxxxxxx
0000 Xxxx Xxxx
Xxxxxx, XX 00000
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11. Miscellaneous. No provision of this Agreement may be
modified, waived or discharged unless such waiver, modification or discharge is
agreed to in writing and signed by the Executive and such officer as may be
specifically designated by the Board. No waiver by either party hereto at any
time of any breach by the other party hereto of, or compliance with, any
condition or provision of this Agreement to be performed by such other party
shall be deemed a waiver of similar or dissimilar provisions or conditions at
the same or at any prior or subsequent time. No agreements or representations,
oral or otherwise, express or implied, with respect to the subject matter hereof
have been made by either party which are not expressly set forth in this
Agreement. The validity, interpretation, construction this Agreement shall be
governed by the laws of the Commonwealth of Pennsylvania. All references to
sections of the Exchange Act or the Code shall be deemed also to refer to any
successor provisions to such sections. Any payments provided for hereunder shall
be paid net of any applicable withholding required under federal, state or local
law and any additional withholding to which the Executive has agreed. The
obligations of the Company and the Executive under Sections 4.2, 6 and 7 shall
survive the expiration of the term of this Agreement.
12. Validity. The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement, which shall remain in full force and
effect.
13. Counterparts; Coordination with Employment Agreement.
13.1. This Agreement may be executed in several
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instruments.
13.2. The terms of this Agreement shall be coordinated
with and applied in conjunction with the terms of the Executive's offer letter
dated August 1, 2003 and accepted by you on August 4, 2003 (the "Offer Letter")
with the Company. In general, it is the intent of the parties that, subsequent
to a Change in Control and during the term of this Agreement, the provisions of
this Agreement shall supersede and substitute for those provisions of the Offer
Letter relating to the Executive's entitlement to benefits in connection with
any termination of the Executive's employment (including without limitation such
provisions in the Offer Letter relating to a "Resignation for Change of Control"
as such term is defined in the Offer Letter), but shall not supersede for any
period the provisions of such Offer Letter pertaining to the terms of the
Executive's employment. Except for circumstances relating to a termination of
employment following a Change in Control during the term of this Agreement, as
provided for herein, all terms and conditions of the Executive's employment with
the Company shall be governed by the terms of the Executive's Offer Letter
(including but not limited to any such term granting additional years of service
to the Executive for purposes of any of the Company's employee benefit plans).
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14. Settlement of Disputes; Arbitration. All claims by the
Executive for benefits under this Agreement shall be directed to and determined
by the Board and shall be in writing. Any denial by the Board of a claim for
benefits under this Agreement shall be delivered to the Executive in writing and
shall set forth the specific reasons for the denial and the specific provisions
of this Agreement relied upon. The Board shall afford a reasonable opportunity
to the Executive for a review of the decision denying a claim and shall further
allow the Executive to appeal to the Board a decision of the Board within sixty
(60) days after notification by the Board that the Executive's claim has been
denied. Any further dispute or controversy arising under or in connection with
this Agreement shall be settled exclusively by arbitration in Philadelphia,
Pennsylvania in accordance with the rules of the American Arbitration
Association then in effect. Judgment may be entered on the arbitrator's award in
any court having jurisdiction; provided, however, that the Executive shall be
entitled to seek specific performance of the Executive's right to be paid until
the Date of Termination during the pendency of any dispute or controversy
arising under or in connection with this Agreement.
15. Definitions. For purposes of this Agreement, the following
terms shall have the meanings indicated below:
(A) "Board" shall mean the Board of Directors of the
Company.
(B) "Cause" for termination by the Company of the
Executive's employment, after any Change in Control, shall mean (i) the willful
and continued failure by the Executive to substantially perform the Executive's
duties with the Company (other than any such failure resulting from the
Executive's incapacity due to physical or mental illness or any such actual or
anticipated failure after the issuance of a Notice of Termination for Good
Reason by the Executive pursuant to Section 7.1 hereof) after a written demand
for substantial performance is delivered to the Executive by the Board, which
demand specifically identifies the manner in which the Board believes that the
Executive has not substantially performed the Executive's duties, or (ii) the
willful engaging by the Executive in conduct which is demonstrably and
materially injurious to the Company or its subsidiaries, monetarily or
otherwise. For purposes of clauses (i) and (ii) of this definition, no act, or
failure to act, on the Executive's part shall be "Willful" unless done, or
omitted to be done, by the Executive not in good faith and without reasonable
belief that the Executive's act, or failure to act, was in the best interest of
the Company.
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(C) A "Change in Control" shall be deemed to have
occurred if the events set forth in any one of the following paragraphs shall
have occurred:
(i) The acquisition in one or more transactions by
any "Person" (as the term person is used for purposes of Sections 13(d) or 14(d)
of the Securities Exchange Act of 1934, as amended (the "1934 Act")) of
"Beneficial Ownership" (as the term beneficial ownership is used for purposes of
Rule 13d-3 promulgated under the 0000 Xxx) of fifty percent (50%) or more of the
combined voting power of the Company's then outstanding voting securities (the
"Voting Securities"), provided that for purposes of this Section 15(C)(i), the
Voting Securities acquired directly from the Company by any Person shall be
excluded from the determination of such Person's Beneficial Ownership of Voting
Securities (but such Voting Securities shall be included in the calculation of
the total number of Voting Securities then outstanding); or
(ii) Approval by shareholders of the Company of
(A) a merger, reorganization or consolidation involving the Company if the
shareholders of the Company immediately before such merger, reorganization or
consolidation do not or will not own directly or indirectly immediately
following such merger, reorganization or consolidation, more than fifty percent
(50%) of the combined voting power of the outstanding voting securities of the
corporation resulting from or surviving such merger, reorganization or
consolidation in substantially the same proportion as their ownership of the
Voting Securities immediately before such merger, reorganization or
consolidation, or (B) (1) a complete liquidation or dissolution of the Company
or (2) an agreement for the sale or other disposition of all or substantially
all of the assets of the Company; or
(iii) Acceptance by shareholders of the Company of
shares in a share exchange if the shareholders of the Company immediately before
such share exchange do not or will not own directly or indirectly immediately
following such share exchange more than fifty percent (50%) of the combined
voting power of the outstanding voting securities of the corporation resulting
from or surviving such share exchange in substantially the same proportion as
the ownership of the Voting Securities outstanding immediately before such share
exchange.
Notwithstanding the foregoing, a Change in Control shall not
include any event, circumstance or transaction occurring during the six-month
period following a Potential Change in Control which Potential Change in Control
results from the action of any entity or group which includes the Executive (a
"Management Group"); provided, however, that such action shall not be taken into
account for this purpose if it occurs within a six-month period following a
Potential Change in Control resulting from the action of any Person which is not
a member of the Management Group.
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(D) "Company" shall mean SYSTEMS & COMPUTER TECHNOLOGY
CORPORATION, a Delaware corporation, and any successor to its business or assets
which assumes and agrees to perform this Agreement by operation of law, or
otherwise (except in determining, under Section 15(C) hereof, whether or not any
Change in Control of the Company has occurred in connection with such
succession).
(E) "Date of Termination" shall have the meaning
stated in Section 7.2 hereof.
(F) "Disability" shall be deemed the reason for the
termination by the Company of the Executive's employment if, as a result of the
Executive's incapacity due to physical or mental illness, the Executive shall
have been absent from the full-time performance of the Executive's duties with
the Company for a period of six (6) consecutive months, the Company shall have
given the Executive a Notice of Termination for Disability and, within thirty
(30) days after such Notice of Termination is given, the Executive shall not
have returned to the full-time performance of the Executive's duties.
(G) "Exchange Act" shall mean the Securities Exchange
Act of 1934, as amended from time to time.
(H) "Executive" shall mean the individual named in the
first paragraph of this Agreement.
(I) "Good Reason" for termination by the Executive of
the Executive's employment shall mean the occurrence (without the Executive's
express written consent) of any one of the following acts by the Company, or
failures by the Company to act, unless, in the case of any act or failure to act
described in paragraph (i), (v), (vi) or (vii) hereof, such act or failure to
act is corrected prior to the Date of Termination specified in the Notice of
Termination given in respect thereof:
(i) the assignment by the Company to the Executive
of any duties inconsistent with the Executive's status as an executive of the
Company or a substantial adverse alteration in the nature or status of the
Executive's responsibilities or authority from those in effect immediately prior
to the Change in Control;
(ii) a reduction by the Company in the Executive's
annual base salary as in effect on the date hereof or as the same may be
increased from time to time;
(iii) the relocation by the Company of its
principal executive offices to a location more than 30 miles from the location
of such office immediately prior to the Change in Control or the Company's
requiring the Executive to be based anywhere other than the Company's principal
executive offices except for required travel on the Company's business to an
extent substantially consistent with the Executive's present business travel
obligations;
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(iv) the failure by the Company to pay to the
Executive any portion of the Executive's current compensation, or to pay to the
Executive any portion of an installment of deferred compensation under any
deferred compensation program of the Company, within seven (7) days of the date
such compensation is due;
(v) the failure by the Company to continue in
effect any compensation plan in which the Executive participates immediately
prior to the Change in Control which is material to the Executive's total
compensation, including but not limited to the Bonus Plan and any similar or
substitute plan adopted prior to the Change in Control, unless an equitable
arrangement (embodied in an ongoing substitute or alternative plan) has been
made with respect to such plan, or the failure by the Company to continue the
Executive's participation therein (or in such substitute or alternative plan) on
a basis not materially less favorable, both in terms of the amount of benefits
provided and the level of the Executive's participation relative to other
participants, as existed at the time of the Change in Control;
(vi) the failure by the Company to continue to
provide the Executive with benefits substantially similar to those enjoyed by
the Executive under any of the Company's pension, life insurance, medical,
health and accident, or disability plans in which the Executive was
participating at the time of the Change in Control, the taking of any action by
the Company which would directly or indirectly materially reduce any of such
benefits or deprive the Executive of any material fringe benefit enjoyed by the
Executive at the time of the Change in Control, or the failure by the Company to
provide the Executive with the number of paid vacation days to which the
Executive is entitled on the basis of years of service with the Company in
accordance with the Company's normal vacation policy in effect at the time of
the Change in Control; or
(vii) any purported termination by the Company of
the Executive's employment which is not effected pursuant to a Notice of
Termination satisfying the requirements of Section 7.1; for purposes of this
Agreement, no such purported termination shall be effective.
The Executive's right to terminate the Executive's employment
for Good Reason shall not be affected by the Executive's incapacity due to
physical or mental illness. The Executive's continued employment shall not
constitute consent to, or a waiver of rights with respect to, any act or failure
to act constituting Good Reason hereunder.
(J) "Notice of Termination" shall have the meaning
stated in Section 7.1 hereof.
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(K) "Person" shall have the meaning given in Section
3(a)(9) of the Exchange Act, as modified and used in Sections 13(d) and 14(d)
thereof and shall include a partnership or other group as provided in Section
13(d)(3) thereof; provided, however, that a Person shall not include (i) the
Company or any of its subsidiaries, (ii) a trustee or other fiduciary holding
securities under an employee benefit plan of the Company or any of its
subsidiaries, (iii) an underwriter temporarily holding securities pursuant to an
offering of such securities, or (iv) a corporation owned, directly or
indirectly, by the stockholders of the Company in substantially the same
proportions as their ownership of stock of the Company.
(L) "Potential Change in Control" shall be deemed to
have occurred if the events set forth in any one of the following paragraphs
shall have occurred:
(i) the Company enters into an agreement, the
consummation of which would result in the occurrence of a Change in Control;
(ii) the Company or any Person publicly announces
an intention to take or to consider taking actions which, if consummated, would
constitute a Change in Control;
(iii) any Person who both (x) is on the date
hereof or subsequently becomes the Beneficial Owner, directly or indirectly, of
securities of the Company representing at least 10% or more of the combined
voting power of the Company's then outstanding securities and (y) increases his
or her beneficial ownership of such securities by 5% or more over the percentage
so owned by such Person on the date hereof; or
(iv) the Board adopts a resolution to the effect
that, for purposes of this Agreement, a Potential Change in Control has
occurred.
(M) "Severance Payments" shall have the meaning stated
in Section 6.1 hereof.
(N) "Total After Tax Payments" shall have the meaning
stated in Section 6.2 hereof. (A)
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IN WITNESS WHEREOF, this Agreement has been executed, as of
the date first above written, on behalf of this Company by its duly authorized
officer and by the Executive.
ATTEST: SYSTEMS & COMPUTER TECHNOLOGY
CORPORATION
/s/ Xxxxxxx X. Xxxxxxxxxx By: /s/ Xxxxxxx X. Xxxxxxxxxxx
----------------------- -------------------------------
Secretary Xxxxxxx X. Xxxxxxxxxxx
President and CEO
EXECUTIVE
By: /s/ Xxxxx Xxxxxxx
-------------------------------
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