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EXHIBIT 10.21
EMPLOYMENT AGREEMENT
THIS AGREEMENT is entered into on February 23, 1999, by and
between Xxxxx X. Xxxxxxxxx (the "Employee") 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 General Counsel and Secretary or in such other position as
the Company subsequently may assign to the Employee. The Employee shall report
to the Company's Senior Vice President and Chief Financial 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 $175,000 (one hundred seventy five thousand dollars). Such salary
shall be payable in accordance with the Company's standard payroll procedures.
(The annual compensation specified in this Subsection (a), together
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with any increases in such compensation that the Company may grant from time to
time, is referred to in this Agreement as "Base Compensation.").
(b) INCENTIVE BONUSES. The Employee shall be
eligible to be considered for an annual incentive bonus with a target amount
equal to 34.3% of 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. VACATION AND EMPLOYEE BENEFITS. During the term of
his Employment, the Employee shall be eligible for paid vacations in accordance
with the Company's standard policy applicable to all of its employees, as it may
be amended from time to time. 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.
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 $5,000 shall require the prior approval of the
Company's Chief Executive Officer 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.
(b) INITIAL TERM AND RENEWAL PERIODS. The
initial term of this Agreement shall end on January 31, 2001 (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
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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. The Employee's Employment
shall terminate automatically in the event of his death.
(d) EMPLOYMENT AT WILL. The Employee's
Employment with the Company shall be "at will." Any contrary representations
which may have been made to the Employee shall be superseded by this Agreement.
This Agreement shall constitute the full and complete agreement between the
Employee and the Company on the "at will" nature of the Employee's Employment,
which may only be changed in an express written agreement signed by the Employee
and a duly authorized officer of the Company.
(e) 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 (i) 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 and (ii) has agreed not to
prosecute any legal action or other proceeding based upon any of such claims.
(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:
(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 Change
in Control and, within 12 months thereafter, the Employee resigns for
Good Reason.
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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 15 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;
(ii) The Employee's misconduct relating
to the Company's affairs, if such misconduct continues for 15 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;
(iii) The Employee's conviction of, or a
plea of "guilty" or "no contest" to, a felony under the laws of the
United States or any state thereof;
(iv) The Employee's failure or refusal
to carry out the reasonable directives of the Company, if such failure
continues for three 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;
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(v) Any breach of this Agreement, the
Proprietary Information and Inventions Agreement between the Employee
and the Company, or any other agreement between the Employee and the
Company;
(vi) Threats or acts of violence
directed at any present, former or prospective employee, independent
contractor, vendor, customer or business partner of the Company; or
(vii) 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 without Cause.
(f) DEFINITION OF "CHANGE IN CONTROL." For all
purposes under this Agreement, "Change in Control" shall mean:
(i) The consummation of a merger or
consolidation of the Company with or into another entity or any other
corporate reorganization, if persons who were not stockholders of the
Company immediately prior to such transaction own immediately after
such transaction 50% or more of the voting power of the outstanding
securities of each of (A) the continuing or surviving entity and (B)
any direct or indirect parent corporation of such continuing or
surviving entity;
(ii) The sale, transfer or other
disposition of all or substantially all of the Company's assets, if
persons who were not stockholders of the Company immediately prior to
such transaction own immediately after such transaction 50% or more of
the voting power of the outstanding securities of each of (A) the
continuing or surviving entity and (B) any direct or indirect parent
corporation of such continuing or surviving entity;
(iii) A change in the composition of the
Board, as a result of which fewer than a majority of the incumbent
directors are directors who either (A) had been directors of the
Company on the date 24 months prior to the date of the event that may
constitute a Change in Control (the "original directors") or (B) were
elected, or nominated for election, to the Board with the affirmative
votes of at least a majority of the aggregate of the original directors
who were still in office at the time of the election or nomination and
the directors whose election or nomination was previously so approved;
(iv) Any transaction as a result of
which any person is the "beneficial owner" (as defined in Rule 13d-3
under the Securities Exchange Act of 1934, as amended (the "Exchange
Act")), directly or indirectly, of securities of the Company
representing more than 50% of the total voting power represented by the
Company's then outstanding voting securities. For purposes of
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this Paragraph (iv), the term "person" shall have the same meaning as
when used in sections 13(d) and 14(d) of the Exchange Act but shall
exclude (A) a trustee or other fiduciary holding securities under an
employee benefit plan of the Company or of a parent or subsidiary of
the Company and (B) a corporation owned directly or indirectly by the
stockholders of the Company in substantially the same proportions as
their ownership of the common stock of the Company; or
(v) Any change in control required to
be reported by Item 1 of Form 8-K of the Securities and Exchange
Commission or by Item 6(e) of Schedule 14A set forth in Rule 14a-101
under the Exchange Act (or by any successor of either).
A transaction shall not constitute a Change in Control if its sole purpose is to
change the state of the Company's incorporation or to create a holding company
that will be owned in substantially the same proportions by the persons who held
the Company's securities immediately before such transaction.
(g) DEFINITION OF "GOOD REASON." For all
purposes under this Agreement, "Good Reason" shall mean:
(i) A significant diminution in the
nature or scope of the Employee's authority, duties or responsibilities
in effect immediately prior to the Change in Control;
(ii) Any reduction in the rate of the
Employee's Base Compensation in effect immediately prior to the Change
in Control or a reduction of 25% or more in the value of the Employee's
aggregate compensation and benefits in effect immediately prior to the
Change in Control;
(iii) The relocation of the Employee's
principal place of employment to a site more than 25 miles removed from
his principal place of employment immediately prior to the Change in
Control; or
(iv) An increase of 25% or more in the
average amount of time per month that the Employee is required to be
away from his principal place of employment, relative to the average
amount of time per month that the Employee was required to be away from
his principal place of employment immediately prior to the Change in
Control.
7. EMPLOYEE'S COVENANTS.
(a) NON-SOLICITATION. 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) either (i) the employment of any employee of the
Company or any of the Company's affiliates or (ii) the business of any customer
of the Company, or of any of the
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Company's affiliates, with whom the Employee had contact during his
Employment. During such period, the Employee shall not encourage or induce, or
take any action that has the effect of encouraging or inducing, any employee of
the Company or any of the Company's affiliates to terminate his or her
employment.
(b) NON-DISCLOSURE. The Employee has entered
into a Proprietary Information and Inventions Agreement with the Company, which
is incorporated herein by reference.
(c) NON-DISPARAGEMENT. 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, disparage the Company or its management.
(d) 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.
(e) 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 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
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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 Proprietary Information and Inventions
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 California (except their provisions governing the choice of law).
(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.
(g) ARBITRATION. Subject to Section 7(d), 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 Santa Xxxxx County, California, 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 California for any action
or proceeding arising from or relating to this Agreement or relating to any
arbitration in which the parties are participants.
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(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.
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/ Xxxxx X. Xxxxxxxxx
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HYPERION SOLUTIONS CORPORATION
By /s/ Xxxxxxx Xxxxxx
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Title: President
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