EXHIBIT 10.1
SEPARATION AGREEMENT
This Separation Agreement ("Agreement") is entered into by mutual agreement by
and between BindView Development Corporation ("BindView" or "Company") and XXXXX
X. FLAME ("Executive") in connection with the Executive's resignation. This
Agreement amends (i) the Executive Employment Agreement between the Executive
and the Company ("Employment Agreement"); (ii) the Change of Control Agreement
between the Executive and the Company; and (iii) any stock or stock option
agreement(s), if any ("Stock Agreement(s)"); between the Executive and the
Company. In the case of any inconsistencies or conflict between any of those
agreements on the one hand and this Agreement on the other hand, the terms of
this Agreement shall govern. Such agreements otherwise remain in effect in
accordance with their terms.
1. The parties agree that:
a. The Executive will resign voluntarily, in furtherance of the parties'
mutual interests, effective November 2, 2004, with his last day of
employment being the same date.
b. For purposes of the Employment Agreement and the Change of Control
Agreement, such resignation will be treated as though the Executive had
Resigned for Good Reason effective November 2, 2004 and will receive the
severance benefits specified in those agreements.
c. The Executive will be paid a sales commission, computed and paid as set
forth in subparagraph 1(d) below, and subject to the exclusion in
subparagraph 1(e) below, for each sale by the Company that meets all of
the following conditions:
i. the sale is in a territory for which the Executive would have
been paid commissions had he remained in his position as the
Company's vice president, Americas sales and field operations
through December 31, 2004;
ii. the sales process for such specific sale was initiated on or
before November 1, 2004 as shown by the Company's records;
iii. the sale is closed on or before December 31, 2004.
d. The sales commissions referred to in subparagraph 1(c) shall be based on
the revenues recorded in the Company's books and records in accordance
with generally accepted accounting principles consistently applied, as
certified by the regular annual audit of the Company's financial
statements. Such commissions will be paid within ten (10) business days
after the Company files its Annual Report on Form 10-K for the fiscal
year ending December 31, 2004, subject to the same terms and conditions
as if the Executive had remained in his position as the Company's vice
president, Americas sales and field operations.
e. Notwithstanding subparagraphs 1(c) and 1(d), the Executive will not be
entitled to commissions on any revenues from professional services in
connection with the preparation and/or production of video-based
training materials.
f. This subparagraph addresses variable compensation to which the Executive
would have been entitled if he had achieved certain management
objectives ("MBOs") previously set by the Company as a target for the
Executive to attempt to achieve in the year 2004. If the Company
determines that such MBO(s) had been achieved by the Executive on an
interim basis as of
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October 31, 2004, then the Company will pay the Executive ten twelfths
(10/12) of the amount to which the Executive would have been entitled
had he remained in his position at the Company through December 31,
2004. Payment of any such variable compensation will be due five
business days after the execution of this Agreement.
g. Section 6.1 of the Employment Agreement (noncompetition covenant) is
amended so that the one-year period referred to therein is reduced to
nine (9) months.
2. As a material condition of receiving the severance benefits described in
paragraph 1 above:
a. the Executive represents that to the best of his knowledge, he has not
participated or been involved in any improper practices that would
warrant termination of an employee for cause; and
b. the Executive agrees to cooperate fully with the Company and its counsel
in (i) the investigation, by the Company's Audit Committee, of certain
of the Company's transactions in Latin America referred to in the
Company's press release dated October 28, 2004; (ii) any other
investigation by the Company or its Board of Directors or any committee
thereof; and (iii) any administrative or legal proceedings that may
arise in respect thereto. In connection therewith, the Company will
reimburse the Executive, in accordance with the Company's standard
reimbursement policies, for all reasonable expenses, if any, that the
Executive may incur at the request of the Company.
3. The Executive will be entitled to payment of unpaid amounts due for salary,
expense reimbursement, pay in lieu of unused vacation, and any other unpaid
amounts due, in accordance with Section 5.7 of the Employment Agreement. The
Executive shall also be entitled to exercise his stock options that are
vested but unexercised as of his last day of employment in accordance with
the procedures set forth in the applicable Stock Agreement(s).
4. Subject to but without limiting paragraphs 1(c) and 1(f) above, any
commissions or other variable compensation earned by the Executive in any
period ending on or before October 31, 2004, that were not previously paid
as of the date of this Agreement, will be paid at the later of (i) the time
called for by the applicable compensation plan as though the Executive were
not resigning, or (ii) five business days after the execution of this
Agreement.
5. Except as set forth in this Agreement, the Executive shall not be entitled
to any further compensation, benefits, or reimbursement of any kind from the
Company, including but not limited to salary, commissions, vacation accrual,
insurance coverage, stock option vesting rights (including but not limited
to accelerated vesting) or exercise rights (including but not limited to
extended periods of time to exercise vested options), severance payments, or
other compensation or benefits.
6. Neither the Company nor the Executive shall make any false or misleading
statement concerning the other in any public statement or comment, nor shall
the Company do so in its internal communications. The Company will refer all
requests for references concerning the Executive (e.g., from recruiters or
prospective employers) to the Company's chief executive officer.
7. The Executive acknowledges that he continues to be bound by the Employment
Agreement, without limitation, Sections 8 (confidentiality), Section 9
(intellectual property), and Section 10 (noncompetition covenant) thereof,
which are also incorporated into this Agreement by reference as though fully
set forth herein.
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8. Sections 12 (arbitration) and 13 (general provisions) of the Employment
Agreement are incorporated into this Agreement by reference as though fully
set forth herein.
9. The Executive is contemporaneously executing a release substantially in the
form set forth as an exhibit to the Employment Agreement. Such release is
subject to the terms and conditions stated therein, including but not
limited to the Executive's right to consider the release before executing it
and his right to revoke the release during a stated period of time. If the
Executive duly revokes such release in accordance with the terms and
conditions set forth therein, this Agreement shall be rescinded and shall be
of no force or effect.
THIS AGREEMENT CONTAINS PROVISIONS REQUIRING BINDING ARBITRATION OF DISPUTES,
WHICH HAVE THE EFFECT OF WAIVING EACH PARTY'S RIGHT TO A JURY TRIAL. By signing
this Agreement, the Executive acknowledges that the Executive (1) has read and
understood the entire Agreement; (2) has received a copy of it (3) has had the
opportunity to ask questions and consult counsel or other advisors about its
terms; and (4) agrees to be bound by it.
EXECUTED the dates written below, to be effective November 2, 2004.
AGREED: AGREED:
BINDVIEW DEVELOPMENT CORPORATION, by:
/s/ Xxxx X. Xxxxxxx /s/ Xxxxx X. Flame
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Xxxx X. Xxxxxxx, Chairman and Xxxxx X. Flame
Chief Executive Officer
November 3, 2004 November 3, 2004
------------------------------ ------------------------------
Date signed Date signed
STATE OF TEXAS
ON NOVEMBER 3, 2004, personally appeared before me, the undersigned Notary
Public for the State of Texas, XXXXX X. FLAME, known to me or identified by
sufficient evidence, who acknowledged that he had executed the foregoing
instrument for the purposes and consideration therein stated.
Date: Nov. 3, 2004 /s/ Xxxxxx X. Fish
-------------------------------------
Xxxxxx X. Fish
My commission expires: Feb. 10, 0000
XX NOVEMBER 3, 2004, personally appeared before me, the undersigned Notary
Public for the State of Texas, XXXX X. XXXXXXX, Chairman and Chief Executive
Officer of
BindView Development Corporation, known to me or identified by
sufficient evidence, who acknowledged that he had executed the foregoing
instrument in the capacity and for the purposes and consideration therein
stated.
Date: Nov. 3, 2004 /s/ Xxxxxx X. Fish
-------------------------------------
Xxxxxx X. Fish
My commission expires: Feb. 10, 2005
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