EMPLOYMENT AGREEMENT dated as at October 16, 1998 ("Agreement"),
between Industri-Matematik American Operations, Inc. ("Company")
and Xxxxxxxx Xxxxxxxx ("Employee").
BACKGROUND.
A. The Employee will be employed by the Company as of October
19, 1998.
B. The Company desires to have the benefit of Employee's
knowledge and experience in the business of the Company, the
Company's parent, Industri-Matematik International Corp. ("IMIC"),
and IMIC's other subsidiaries (Company, IMIC, and the IMIC
subsidiaries collectively, "IMIC Group").
C. The Employee desires to be employed by the Company upon the
terms and conditions set forth in this Agreement.
IT IS AGREED:
1. Employment.
1.1. Duties and Responsibilities. The Company hereby offers
employment to the Employee, and Employee hereby accepts employment
with the Company. During the Employment Term, Employee shall
serve as a Vice President of Americas Services of the Company, and
Employee shall perform all duties and accept all responsibilities
incidental to such position or as may be assigned to Employee by
the Company's President, the Chief Executive Officer, and/or
Employee's Manager of IMIC and Employee shall cooperate fully with
other Executive Officers of IMIC.
1.2. Extent of Service. During the Employment Term,
Employee shall (a) use his best efforts in the business of the
IMIC Group, (ii) devote his full business time and substantially
all of his attention and energy to the business of the IMIC Group
and to the performance of Employee's services and the discharge of
Employee's duties and responsibilities pursuant to this Agreement,
(iii) faithfully and diligently perform his duties and
responsibilities pursuant to this Agreement, and (iv) conduct
himself in a competent and professional manner which reflects
positively upon the IMIC Group. Subject to the provisions of
Section 4.2.b, the foregoing shall not be construed to prevent
Employee from making investments in other businesses or
enterprises, provided that Employee agrees not to become engaged
in any other activity that may interfere with Employee's ability
to discharge Employee's duties and responsibilities pursuant to
this Agreement. In addition to the restrictions set forth in
Section 4.2, Employee further agrees that he may not work either
on a part time or independent contractor basis or in any other
capacity during the Employment Term without the prior written
approval of the Company's President and/or IMIC's Chief Executive
Officer. The location at which Employee shall be obligated to
perform his duties shall require him to move his personal
residence and acknowledge that business travel is an integral part
of the performance of his duties.
1.3. Employment Term. The term of employment under this
Agreement ("Employment Term") shall commence on October 19, 1998,
and shall continue unless terminated earlier in accordance with
Section 3.
1.4. Company Policies. Employee shall comply with all
employment policies and practices of the Company and/or the IMIC
Group announced in writing from time to time, including, without
limitation, all policies and practices related to the receipt of
confidential information, the purchase and sale of IMIC Common
Stock, and other policies related to general business ethics.
1.5. Employee Representation and Warranty. Employee hereby
represents to the Company that the execution and delivery of this
Agreement by him and the performance of his obligations pursuant
to this Agreement are not in violation of, and do not conflict
with or constitute a default under any agreement by which he is
bound (including any agreement pertaining to his prior employment
with another entity) or any order, decree, or judgment to which he
is subject, that this Agreement constitutes the valid and binding
obligation of Employee, and that he is not a party to or bound by
any agreement, understanding, or arrangement which would prevent
him from carrying out the terms of this Agreement or subject the
Company to liability for employing the Employee.
2. Compensation.
2.1. Salary and Variable Compensation. For all of the
services rendered during the Employment Term by Employee, the
Company shall:
2.1.a. pay Employee a base salary at the rate of
$200,000 per year ("Salary") in accordance with the Company's
normal payroll practices, which Salary may be increased from time
to time during the Employment Term in the sole discretion of the
Company;
2.1.b. pay Employee variable compensation as set
forth in the separate variable compensation agreement executed by
Employee and the Company applicable to that fiscal year.
2.1.c. Relocation Reimbursement. The Company does
require the Employee to relocate; the Company shall reimburse the
Employee for all expenses reasonably relating to the Employee
relocating to Marlton, NJ area between June 1999 and September
1999. Such expenses shall include all moving and storage expenses
and the like. The reimbursement shall be paid upon presentation of
paid receipts. You will also receive a one-time moving allowance
of $15,000 based on actual receipts. If you exceed $15,000, in
moving expenses, IMI will pay up to one half of the next $15,000
in expenses based on actual receipts.
2.2. Stock Options. On a date within 45 days of the date of
this Agreement as determined by the Compensation Committee of the
Board of Directors of IMIC Employee will be granted options to
purchase 75,000 shares of IMIC Common Stock at an exercise price
equal to the closing market price on the date of grant, pursuant
to the terms of the IMIC Stock Option Plan ("Plan"). All options
referred to in this Section 2.2 shall be designated as incentive
stock options to the maximum extent permitted by the Plan.
2.3. Automobile Allowance. Employee shall be paid an
automobile allowance of $450 per month.
2.4. Vacation. Employee shall be entitled to 20 days of
vacation per calendar year. The timing of vacation shall be
reviewed by the Employee's Manager and take place according to the
Company's business situation. Vacation days should be taken within
each calendar year, circumstances permitting. The Company's
President will consider, in his sole discretion, whether or not to
pay Employee for any accrued but unused vacation.
2.5. Fringe Benefits. Employee shall be entitled to such
fringe benefits, including but not limited to sick leave, medical
and dental benefits, and life insurance as are generally provided
by the Company to its other executives employees, subject to the
terms of the applicable plans and programs as such plans or
programs may be in effect from time to time; it being expressly
understood that the Company, in its sole and absolute discretion,
may determine to amend, revise, replace, or terminate any such
plans or programs at any time and/or in accordance with applicable
law, provided that no such amendment, revision, replacement, or
termination may affect Employee's vested rights.
2.6. Business Expenses. The Company shall reimburse
Employee for all ordinary and necessary out-of-pocket business
expenses incurred by Employee in connection with the discharge of
Employee's duties and responsibilities pursuant to this Agreement
during the Employment Term in accordance with the Company's
expense approval procedures in effect from time to time and upon
presentation to the Company of an itemized account and written
proof of such expenses. If the Company shall provide Employee
with any corporate credit cards or other similar instruments,
Employee shall use such cards or instruments solely for purposes
of performing his duties and responsibilities pursuant to this
Agreement and not for personal use, and shall return to the
Company all such cards and instruments immediately upon the
request of the Company.
3. Termination.
3.1. Disability. If the Company's President, Chief
Executive Officer, or Employee's Manager of IMIC has determined
that the Employee has become unable to perform Employee's duties
and responsibilities pursuant to this Agreement by reason of
physical, psychological, or emotional reasons, and if such
inability continues for more than 60 consecutive days or a total
of 90 days in any 180 day period, during which time the Company
shall continue to compensate Employee under this Agreement (with
such compensation to be reduced by the amount of any disability
payment or similar payment received by Employee for this time
period under any plan paid for by the IMIC Group or through
workers' compensation), the Employment Term may be terminated by
the Company, in which event Company shall have no further
liability or obligation to Employee except for payment of earned
but unpaid Salary, unpaid Variable Compensation if and as set
forth in a Variable Compensation Agreement, accrued but unpaid
automobile allowance, and incurred but unreimbursed business
expenses at the date of Employee's termination, and any additional
disability, severance, or other benefits otherwise payable to
Employee under any applicable policy or plan which covers Employee
at the time of Employee's termination and is in effect at that
time. If requested by the Company, Employee agrees to submit to a
physical examination by a licensed physician selected and paid for
by the Company.
3.2. Death. The Employment Term shall terminate on the
death of the Employee and the Company shall pay to Employee's
distributees, personal representatives, executors, or
administrators, as appropriate, an amount equal to any unpaid
balance of Employee's Salary payable for the month in which
Employee dies, unpaid Variable Compensation if and as set forth in
a Variable Compensation Agreement, accrued but unpaid automobile
allowance, and incurred but unreimbursed business expenses at the
date of death. The Company shall not have no further liability or
obligation under this Agreement to Employee's distributees,
personal representatives, executors, or administrators except as
may be defined by any of Company's existing employee benefit plans
which covered the Employee at the time of Employee's death.
3.3. Termination for Cause. The Company shall have the
right to terminate the Employment Term at any time for "cause"
upon notice to Employee. For purposes of this Agreement, "cause"
shall mean dishonesty, disloyalty, variable commission of a felony
or other crime involving moral turpitude, misappropriation of
funds, habitual insobriety, substance abuse, willful misconduct or
gross negligence in the performance of Employee's duties and
responsibilities under this Agreement, material breach by the
Employee of the terms of this Agreement, Employee's repeated
failure to follow the reasonable directives of the Company's
President, Chief Executive Officer, or Employee's Manager of IMIC
as to the time, place, and manner of performance of the Employees
duties and responsibilities under this Agreement, or any other
action on the part of Employee that is damaging or detrimental to
the IMIC Group. In the event Employee is terminated for "cause,"
all of the Company's compensation obligations pursuant to Section
2 will cease upon the effective date of the notice of termination
except for the payment of earned but unpaid Salary, accrued but
unpaid automobile allowances, and incurred but unreimbursed
business expenses at the effective date of termination.
3.4. Termination of Employee. The Company may terminate
this Agreement for any reason upon notice to Employee, and if the
Company terminates this Agreement for any reason other than
pursuant to Section 3.1, 3.2, or 3.3, the Company shall continue
to compensate Employee pursuant to and in accordance with all the
provisions of Section 2 for a one-year period following the date
of termination, plus any earned but unpaid Salary, earned but
unpaid Variable Compensation if and as set forth in a Variable
Compensation Agreement, accrued but unpaid automobile allowances,
and incurred but unreimbursed business expenses at the effective
date of termination.
3.5. Termination by Employee. Nothing in this Agreement
shall be construed to prevent the termination of the Employment
Term by Employee upon 180 days written notice. Upon written
notice of termination by Employee, the Company reserves the right
to waive the notice period and accept notice effective
immediately. In the event that Employee terminates the Agreement,
all of the Company's compensation obligations pursuant to Section
2, including any compensation to which Employee may become
entitled after giving notice, will cease upon the termination
date, except for the payment of earned but unpaid Salary, unpaid
Variable Compensation if and as set forth in a Variable
Compensation Agreement, accrued but unpaid automobile allowances,
and incurred but unreimbursed business expenses at the effective
date of termination.
4. Trade Secrets, Non-Competition, Non-Solicitation, Non-
Interference, Non-Disparagement, and Return of Materials.
4.1. Employee Acknowledgment. Employee acknowledge that:
(a) his employment by the Company will bring him into close
contact with many confidential affairs of the IMIC Group, (b) the
business of the IMIC Group is conducted throughout the world and
competes with similar businesses of other organizations, (c) the
IMIC Group carries on substantial promotional, marketing, and/or
sales activities throughout the world, and (d) the covenants
contained in Sections 4.2, 4.3, 4.4, and 4.5 of this Agreement are
specific inducements by Employee to the Company in connection with
the execution of this Agreement.
4.2. Trade Secrets, Non-Competition, and Non-Solicitation.
In recognition of the provisions of Section 4.1 and as
consideration for Employees' employment by the Company, the
payment by the Company to Employee of compensation, and the
Company providing Employee with benefits, Employee agrees that:
4.2.a. During the Employment Term and at all times
thereafter, Employee shall not disclose, communicate, or divulge
to any person (other than to officers, directors, or employees of
the IMIC Group whose duties require such knowledge) or use for
Employee's personal benefit or for the benefit of anyone other
than the IMIC Group any trade secrets, specifications, sales
plans, programs, research, software or applications development
plans, or other confidential information employed in or proposed
to be employed in the business of the IMIC Group which comes to or
came to Employee's knowledge in the course of or by reason of his
employment by the Company or his performance under this Agreement.
4.2.b. During the Employment Term, during any
period of time the Employee is performing services for any member
of the IMIC Group, and for a period of one year thereafter,
Employee shall not directly or indirectly anywhere in the world
enter into or in any manner take part as an employee, agent,
independent contractor, consultant, owner, sole proprietor,
partner, joint venturer, member, manager, officer, director, or
shareholder or take part in any other capacity in, for, or with
any person, firm, corporation, association, or business enter-
prise, or in any manner render any assistance to any business or
endeavor, whose business activities are the same or similar to,
the business which is conducted by the IMIC Group during the
course of Employee's employment by the Company, provided that the
provisions of this Section 4.2.b shall not preclude Employee from
ownership, as an investor, of less than 5% of the stock of a
publicly owned company which engages in such business activities.
4.3. Non-Interference. During the Employment Term, during
any period of time the Employee is performing services for the
IMIC Group, and for a period of one year thereafter, neither
Employee nor any person, firm, corporation, association, or
business enterprise with which Employee is affiliated as an
employee, agent, independent contractor, consultant, owner, sole
proprietor, partner, joint venturer, member, manager, officer,
director, or shareholder shall (a) directly or indirectly induce
or attempt to induce any employee of the IMIC Group to terminate
or alter his employment relationship with the IMIC Group, (b)
directly or indirectly hire any person who is or had been employed
by the IMIC Group, or (c) directly or indirectly interfere or
intervene in any way with the relationship between any member of
the IMIC Group and any of its licensees, customers,
subcontractors, suppliers, vendors, or partners.
4.4. Non-Disparagement. During the Employment Term and at
all times thereafter (a) Employee shall not directly or indirectly
disparage the name, reputation, products, or services of any
member of the IMIC Group and (b) the Company shall not, directly
or indirectly, disparage Employee's name or reputation.
4.5 Return of Materials. Employee agrees that all
memoranda, notes, records, papers, or other documents, all
software developed by or for the IMIC Group, including without
limitation System ESS Software, and all copies thereof relating to
the IMIC Group's operations or business, and all objects
associated therewith in any way obtained by Employee during the
course of his employment by the Company shall be the IMIC Group's
sole and exclusive property. Employee shall not, except for the
IMIC Group's use, copy, or duplicate any of the aforementioned
documents or objects, nor use any information concerning them
except for the IMIC Group's benefit, either during his employment
by the Company or thereafter. Employee agrees that he will
deliver all of the aforementioned documents, software, and objects
that may be in his possession to the IMIC Group on termination of
his employment, or any other time upon the Company's request,
together with his written certification of compliance with the
provisions of this Section 4.5.
4.6. Additional Provisions.
4.6.a. In the event that the provisions of
Sections 4.2, 4.3, 4.4, or 4.5 should be deemed unenforceable, in-
valid, or overbroad in whole or in part for any reason, any court
of competent jurisdiction, or the Arbitrator appointed in
accordance with the provisions of Section 5.1, whichever forum is
designated by the injured party, is hereby authorized, requested,
and instructed to reform such sections consistent with the intent
of Sections 4.2, 4.3, 4.4, or 4.5 to provide for the maximum
restraints upon (i) Employee's activities (including, but not
limited to, time, geographic area, customer solicitation,
relationship interference, employee solicitation, and
disparagement) and (ii) with respect to Section 4.4, the Company's
activities, which may then be legal and valid.
4.6.b. The Company and Employee agree that
violation by Employee of the provisions of Sections 4.2, 4.3, 4.4,
or 4.5 or by the Company of the provisions of Section 4.4 will
cause irreparable injury to the other for which any remedy at law
would be inadequate, and that the injured party shall be entitled
in any court of law or equity or in any arbitration proceeding in
accordance with Section 5.1, whichever forum is designated by the
injured party, to temporary, preliminary, permanent, and other
injunctive relief against any breach of the provisions contained
in such sections, and such punitive and compensatory damages as
shall be awarded. Further, in the event of a violation of the
provisions of Sections 4.2, 4.3, or 4.4, the period of non-
competition, non-solicitation, employee noninterference, or non-
disparagement referred to therein shall be extended for a period
of time equal to that period beginning on the date when such
violation commenced and ending when the activities constituting
that violation shall be finally terminated.
5. Arbitration and Jurisdiction.
5.1. Arbitration. Except for a determination to be made in
the discretion of the Company such as a determination of the
quota, and except as otherwise alternatively provided in Section
4.6, any controversy or claim arising out of or relating to this
Agreement, or the breach of this Agreement, shall be settled by
arbitration by one Arbitrator in New York, New York, in accordance
with the Rules of the American Arbitration Association, and
judgment upon the award rendered by the Arbitrator may be entered
in any court having jurisdiction thereof, provided that in the
event the IMIC Group commences a litigation pursuant to the
provisions of Section 4.6, all claims between the Company and
Employee shall be litigated and not arbitrated.
5.2. Jurisdiction. Each of the Company and Employee hereby
consents to the jurisdiction of the Supreme Court of the State of
New York for the County of New York and the United States District
Court for the Southern District of New York for all purposes in
connection with (a) the arbitration referred to in Section 5.1 and
(b) this Agreement, and further consents that any process or
notice of motion in connection therewith may be served by certi-
fied or registered mail or by personal service in accordance with
the provisions of Section 6, within or without the State of New
York, provided a reasonable time for appearance is allowed.
6. Notices. All notices provided for in this Agreement shall
be in writing and shall be given to the addresses set forth below
by registered or certified mail, return receipt requested, and by
regular mail, both with postage prepaid, or personally delivered,
or sent by facsimile transmission (provided the transmitting
device provides a record of transmission) or by prepaid express
mail or other overnight delivery service of any nationally
recognized private carrier guaranteeing overnight delivery. Any
such notice shall be deemed given (i) when so delivered personally
or sent by facsimile transmission if received at the receiving
location during business hours, (ii) on the next business day if
sent by facsimile transmission and received at the receiving
location after business hours, (iii) on the date of delivery if
sent by express or such private carrier guaranteeing overnight
delivery if delivered during business hours at the receiving
location, (iv) on the next business if sent by express mail or
such private carrier guaranteeing overnight delivery if delivered
at the receiving location at any time other than during business
hours, or (v) if mailed, five business days after the date of
deposit in the United States mail.
The addresses referred to above are:
Employee's address:1208 Xxxxxxxxx Xxxx
Xxxxxxx, XX 00000
With a copy to: _____________________
_____________________
_____________________
Attn: _______________
Company address:5 Xxxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, XX 00000
Attn: Xxxxxxx Xxxx,
Director of Human Resources
With a copy to: Xxxxxxxxxx Xxxxx & Xxxxxxxx, LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx X. Xxxxxxxx, Esq.
Either the Company or Employee at any time may give notice
of another address for it, him, or for copies in accordance with
the provisions of this Section 6.
7. Miscellaneous.
7.1. This Agreement (a) shall be governed by and construed
in accordance with the laws of the State of New York as if it were
an agreement made and to be performed entirely within such State,
(b) may not be modified or amended except by a writing signed by
each of the Company or its successors and Employee, (c) shall be
binding upon each of the Company and its successors and Employee
and his distributees, personal representatives, executors, and
administrators, and (d) contains the entire agreement and under-
standing between the Company and Employee with respect to the
subject matter of this Agreement and supersedes all prior
agreements, arrangements, and understandings, written or oral,
between the Company and Employee with respect to the subject
matter of this Agreement.
7.2. This Agreement may not be assigned by Employee. This
Agreement may be assigned by the Company to any other member of
the IMIC Group. This Agreement may not otherwise be assigned by
the Company or the IMIC Group without Employee's written consent
which shall not be unreasonably withheld or delayed.
7.3. The headings in this Agreement are inserted for
convenience of reference only and shall not in any manner affect
the construction or meaning of anything herein contained or govern
the rights or liabilities of the parties to this Agreement. All
pronouns used shall be adjusted to the appropriate number and
gender as required by the context and circumstances.
7.4. To the extent that this Agreement requires Employee to
comply with obligations for the benefit of any member of the IMIC
Group, each such entity shall be a third-party beneficiary of this
Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement.
INDUSTRI-MATEMATIK AMERIRICAN OPERATIONS, INC.
By:___________________________________
Xxxx Xxxxxxxx
Senior Vice President, World Wide Services
______________________________________
Xxxxxxxx Xxxxxxxx
