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Exhibit 10.5
[Inprise Letterhead]
May 16, 2000
Xxxxx Xxxxxxxxx
[ADDRESS INTENTIONALLY OMITTED]
RE: EMPLOYMENT AGREEMENT
Dear Xxxxx:
On behalf of INPRISE Corporation ("INPRISE"), I am pleased to confirm
our verbal offer of employment to you for the position of Senior Vice President
and General Counsel of the company, reporting to Xxxx Xxxxxx. This letter sets
out the terms of your employment with INPRISE, which will start on a date
mutually agreed upon.
You will be paid a base salary of $11,538.46 every two weeks (which
equals $300,000.00 per year), less applicable tax and other withholdings. You
will be eligible to participate in the 2000 Executive Incentive Program with an
annual target of $120,000.00 (40% of base salary). This bonus is paid quarterly
and is conditional upon the company achieving certain targets. You will also be
eligible to participate in various INPRISE fringe benefit plans, including:
Group Health Insurance, Flexible Spending Accounts, 401(k), Employee Stock
Purchase Plan, Tuition Reimbursement and the vacation program. These benefits
will be explained to you during your Employee Orientation. Please refer to the
attached document, which explains the new employee orientation process.
Subject to the approval of INPRISE's Board of Directors, you will be
granted an option to purchase 375,000 shares of INPRISE common stock under
INPRISE's stock option plans at an exercise price equal to the fair market value
of that stock on your option grant date, which will be the date of the next
meeting of the INPRISE Board of Directors. The options are subject to the
standard terms and conditions of INPRISE's stock option plans, including four
year vesting, with six forty-eighths (6/48) of these shares vesting after six
(6) months and the remaining shares vesting monthly over the following three and
one half (3 1/2) years. Notwithstanding the foregoing, in the event that the
company is acquired or is subject to a change in control, the vesting of the
option will be accelerated and the option shall be exercisable in full. For
these purposes, an "acquisition of the company" shall mean a merger or other
transaction in which the company or substantially all of its assets is sold or
merged and as a result of such transaction, the holders of the Company's common
stock prior to such transaction do not own or control a majority of the
outstanding shares of the successor corporation and a "change of control" shall
mean the election of nominees constituting a majority of the Company's Board of
Directors which nominees were not approved by a majority of the Company's Board
of Directors prior to such election or the acquisition by a third party of
twenty percent (20%) or more of the company's outstanding shares which
acquisition was without the approval of a majority of the Board of Directors of
the company in office prior to such acquisition.
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Confidentiality. INPRISE is very impressed with the skills and
experience that you will bring to us and we hope that you will consider this
offer carefully. Should you accept this offer, I would like to remind you that
it is INPRISE's policy to avoid situations where information or materials might
come into our hands that are considered proprietary by individuals or companies
other than INPRISE. Indeed, as a condition of employment, you will be required
to sign an agreement not to expose either you or us to legal liability by
divulging trade secrets or confidential information of any employer. We are
interested in employing you because or your skills and abilities, not because of
any trade secrets you may have learned elsewhere. Thus, it is important that you
take care not to bring, even inadvertently, any books, drawings, notes,
materials, etc., except your personal effects as you leave your current
employer.
Termination. As with all employment at INPRISE, your employment is
considered "at will." That means that both you and INPRISE have the right to
terminate employment at any time with or without advance notice, and with or
without cause. Notwithstanding the foregoing, if the company terminates your
employment for other than cause or there is a constructive termination, and in
contingent upon your signing of a general release, substantially similar to the
form of release attached to INPRISE'S customary change in control agreement, the
Company agrees that you will be entitled to a severance payment equal to six (6)
months of base salary and six (6) months accelerated vesting of any unvested
stock options.
For purposes of this Agreement, termination for "cause" shall mean
termination of your employment relationship with INPRISE for any of the
following reasons: (i) your engaging in an act of theft, embezzlement,
misappropriation of funds or property, or fraud against, or with respect to the
business of INPRISE; (ii) a willful breach by you of any material term of this
Agreement and, if such breach is capable of being cured, the failure by you to
cure such breach within thirty (30) days of written notice of such breach; (iii)
if you are convicted of a felony that materially impairs your performance of
duties for INPRISE; or (iv) as a result of your reckless or willful misconduct,
you commit any act that causes, or knowingly fails to take reasonable and
appropriate action to prevent, any material injury to the financial condition or
business reputation of INPRISE.
"Constructive termination" shall mean any one or more of the following:
(i) without your express written consent, the relocation of the principal place
of your employment to a location that is more than fifty (50) miles from the
company's current headquarters; (ii) any failure by INPRISE to pay, or any
material reduction by INPRISE of, your base salary or benefits (unless
reductions comparable in amount and duration are concurrently made for all other
employees of INPRISE with responsibilities, organizational level and title
comparable to yours) or (iii) a material diminution of your responsibilities.
In the event of any dispute or claim relating to or arising out of your
employment relationship with INPRISE, this agreement, or the termination of your
employment with INPRISE for any reason (including, but not limited to, any
claims of breach of contract, wrongful termination or age, sex, race, national
origin, disability or other discrimination or harassment), you and INPRISE agree
that all such disputes shall be fully, finally and
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exclusively resolved by binding arbitration conducted by the American
Arbitration Association in Santa Xxxxx County, California. You and INPRISE
hereby waive your respective rights to have such disputes tried by a judge or
jury. This arbitration provision shall not apply to any claims for injunctive
relief by you or INPRISE.
This agreement, the employee confidentiality agreement, together with
INPRISE'S customary change in control agreement, a form of which is attached
hereto, which Inprise will enter into with you as soon as practicable after the
date hereof, and if applicable, the stock option agreement(s) referred to above
constitute the entire agreement between you and INPRISE regarding the terms and
conditions of your employment, and they supersede all prior negotiations,
representations or agreements between you and INPRISE. This agreement may only
be modified by a document signed by you and the President of INPRISE.
We are very pleased to confirm these terms with you. Please take the
time to review this letter and, if appropriate, sign and return a copy to me. We
all look forward to a mutually beneficial relationship and in the meantime,
should you have any questions, please do not hesitate to contact me at any time.
Sincerely,
INPRISE Corporation
By: /s/ Xxxx Xxxxxx
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Xxxx Xxxxxx
President/Chief Executive Officer
I agree to and accept employment with INPRISE Corporation on the terms
and conditions set forth in this agreement.
Date: May 18, 2000 /s/ Xxxxx Xxxxxxxxx
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Xxxxx Xxxxxxxxx
