AMENDMENT
August 1, 2000
THIS AMENDMENT modifies and amends the Employment Agreement (the
"Agreement") by and between DENDRITE INTERNATIONAL, INC. ("Dendrite") and
Xxxxxxxxx Xxxxxxxxxx ("Employee"). Unless otherwise defined herein, capitalized
terms used herein shall have their respective meanings set forth in the
Agreement.
The parties hereby agree as follows:
1. The Agreement is hereby modified to include the following:
26. VESTING OF STOCK OPTIONS UPON "CHANGE IN CONTROL"
Notwithstanding anything to the contrary, in the event of a "Change in
Control" (as defined below), all of Employee's options owned by him at the time
of such event shall immediately vest. For the purposes of this Agreement,
"Change in Control" shall mean the occurrence of any one of the following
events:
(i) any "person" (as such term is defined in Section
3(a)(9) of the Securities and Exchange Act of 1934, as amended
(the "Exchange Act"), and as used in Sections 13(d)(3) and
14(d)(2) of the Exchange Act) is or becomes a "beneficial
owner" (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of Dendrite representing
33-1/3% or more of the combined voting power of Dendrite's
then outstanding securities eligible to vote for the election
of the Board (the "Dendrite Voting Securities"); provided,
however, that the event described in this paragraph (i) shall
not be deemed to be a Change in Control by virtue of any of
the following acquisitions: (A) by Dendrite or any subsidiary,
(B) by any employee benefit plan sponsored or maintained by
Dendrite or any subsidiary, (C) by any underwriter temporarily
holding securities pursuant to an offering of such securities,
(D) pursuant to a Non-Control Transaction (as defined in
paragraph (iii)), or (E) a transaction (other than one
described in (iii) below) in which Dendrite Voting Securities
are acquired from Dendrite, if a majority of the Incumbent
Board (as defined below) approves a resolution providing
expressly that the acquisition pursuant to this clause (E)
does not constitute a Change in Control under this paragraph
(i);
(ii) individuals who, on the effective date of this
Agreement, constitute the Board (the "Incumbent Board") cease
for any reason to constitute at least a majority thereof,
provided that any person becoming a director subsequent to the
Effective Date, whose election or nomination for election was
approved by a vote of at least two-thirds of the directors
comprising the Incumbent Board (either by a specific vote or
by approval of the proxy statement of Dendrite in which such
person is named as a nominee for director, without objection
to such nomination) shall be considered a member of the
Incumbent Board; provided, however, that no individual
initially elected or nominated as a director of Dendrite as a
result of an actual or threatened election contest with
respect to directors or any other actual or threatened
solicitation of proxies or consents by or on behalf of any
person other than the Board shall be deemed to be a member of
the Incumbent Board;
(iii) the shareholders of Dendrite approve a merger,
consolidation, share exchange or similar form of corporate
reorganization of Dendrite or any such type of transaction
involving Dendrite or any of its subsidiaries (whether for
such transaction or the issuance of securities in the
transaction or otherwise) (a "Business Combination"), unless
immediately following such Business Combination: (A) more than
50% of the total voting power of the publicly traded
corporation resulting from such Business Combination
(including, without limitation, any corporation which directly
or indirectly has beneficial ownership of 100% of Dendrite
Voting Securities or all or substantially all of the assets of
Dendrite and its subsidiaries) eligible to elect directors of
such corporation would be represented by shares that were
Dendrite Voting Securities immediately prior to such Business
Combination (either by remaining outstanding or being
converted), and such voting power would be in substantially
the same proportion as the voting power of such Dendrite
Voting Securities immediately prior to the Business
Combination, (B) no person (other than any publicly traded
holding company resulting from such Business Combination, any
employee benefit plan sponsored or maintained by Dendrite (or
the corporation resulting from such Business Combination), or
any person which beneficially owned, immediately prior to such
Business Combination, directly or indirectly, 33-1/3% or more
of Dendrite Voting Securities (a "Dendrite 33-1/3%
Stockholder")) would become the beneficial owner, directly or
indirectly, of 33-1/3% or more of the total voting power of
the outstanding voting securities eligible to elect directors
of the corporation resulting from such Business Combination
and no Dendrite 33-1/3% Stockholder would increase its
percentage of such total voting power, and (C) at least a
majority of the members of the board of directors of the
corporation resulting from such Business Combination would be
members of the Incumbent Board at the time of the Board's
approval of the execution of the initial agreement providing
for such Business Combination (a "Non-Control Transaction");
or
(iv) the shareholders of Dendrite approve a plan of
complete liquidation or dissolution of Dendrite or the sale or
disposition of all or substantially all of Dendrite's assets.
Notwithstanding the foregoing, a Change in Control of Dendrite shall not be
deemed to occur solely because any person acquires beneficial ownership of more
than 33-1/3% of Dendrite Voting Securities as a result of the acquisition of
Dendrite Voting Securities by Dendrite which, by reducing the number of Dendrite
Voting Securities outstanding, increases the percentage of shares beneficially
owned by such person; provided, that if a Change in Control of Dendrite would
occur as a result of such an acquisition by Dendrite (if not for the operation
of this sentence), and after Dendrite's acquisition such person becomes the
beneficial. owner of additional Dendrite Voting Securities that increases the
percentage of outstanding Dendrite Voting Securities beneficially owned by such
person, then a Change in Control of Dendrite shall occur.
27. SEVERANCE FOLLOWING TERMINATION OF EMPLOYMENT FOLLOWING A "CHANGE IN
CONTROL" "WITHOUT CAUSE" OR FOR "GOOD REASON"
(a) The following severance payment only applies in the event of a
Change in Control. If Employee's employment hereunder is terminated within one
(1) year following a Change in Control (i) by Dendrite for any reason other than
death, Cause, or Disability (each as defined below) or (ii) by Employee for Good
Reason (as defined below), the Employee shall be entitled to receive severance
payments in an aggregate amount equal to the sum of twelve (12) months base
salary (calculated at the rate of base salary then being paid to Employee as of
the date of termination). The severance payments to be paid to Employee under
this Section shall be referred to herein as the "Change in Control Severance
Payment". Employee's Change In Control Severance Payment shall be paid by
Dendrite in cash in twelve (12) consecutive equal monthly payments commencing
not later than thirty (30) days after the effective date of the termination of
Employee's employment. No interest shall accrue or be payable on or with respect
to any Change in Control Severance Payment. In the event of a termination of
Employee's employment described in this Section, Employee shall be provided
continued "COBRA" coverage pursuant to Sections 601 et seq. of ERISA under
Dendrite's group medical and dental plans. During the period which Employee
receives the Change in Control Severance Payment, Employee's cost of COBRA
coverage shall be the same as the amount paid by employees of Dendrite for the
same coverage under Dendrite's group health and dental plans. Notwithstanding
the foregoing, in the event Employee becomes re-employed with another employer
and becomes eligible to receive health coverage from such employer, the payment
of COBRA coverage by Dendrite as described herein shall cease. In the event
Employee is entitled to the Change in Control Severance Payment as set forth in
this Section, Employee shall not be entitled to any other severance payments
from Dendrite.
(b) The making of any Change in Control Severance Payment under this
Section is conditioned upon the signing of a general release in form and
substance satisfactory to Dendrite under which Employee releases Dendrite and
its affiliates together with their respective officers, directors, shareholders,
employees, agents and successors and assigns from any and all claims he may have
against them. In the event Employee breaches any of the covenants or agreements
contained in this Agreement, in addition to any other remedies at law or in
equity, Dendrite may cease making any Change in Control Severance Payment
otherwise due under this Section. Nothing herein shall affect any of Employee's
obligations or Dendrite's rights under this Agreement.
(c) For purposes of this Agreement, "Cause" as used herein shall mean
(i) any gross misconduct on the part of Employee with respect to his duties
under this Agreement, (ii) the engaging by Employee in an indictable offense
which relates to Employee's duties under this Agreement or which is likely to
have a material adverse effect on the business of Dendrite, (iii) the commission
by Employee of any willful or intentional act which injures in any material
respect or could reasonably be expected to injure in any material respect the
reputation, business or business relationships of Dendrite, including without
limitation, a breach of any of his covenants or agreements of this Agreement, or
(iv) the engaging by Employee through gross negligence in conduct which injures
materially or could reasonably be expected to injure materially the business or
reputation of Dendrite.
(d) For purposes of this Agreement, "Good Reason" as used herein shall
mean, without Employee's express written consent, concurrently with or within
one (1) year following a "Change in Control" (as defined above), the occurrence
of any of the following events which is not corrected within ten (10) days
following notice of such event given by Employee to Dendrite:
(i) the assignment to Employee of any duties or
responsibilities materially and adversely inconsistent with
Employee's position (including any material diminution of such
duties or responsibilities) or a material and adverse change
in Employee's reporting responsibilities, titles or offices
with Dendrite;
(ii) any material breach by Dendrite of this
Agreement. with respect to the making of any compensation
payments;
(iii) any requirement of Dendrite that Employee be
based anywhere other than in a thirty-five (35) mile radius of
the Dendrite office Employee is based in on the date of
consummation of the Change in Control;
(iv) the failure of Dendrite to continue in effect
any employee benefit plan, compensation plan, welfare benefit
plan or fringe benefit plan (such plans being referred to
herein as "Welfare Plans") in which Employee is participating
as of the effective date of this Agreement (or as such
benefits and compensation may be increased from time to time),
or the taking of any action by Dendrite which would materially
and adversely affect Employee's participation in or materially
reduce Employee's benefits under such Welfare Plans (other
than an across-the-board reduction of such benefits affecting
senior executives of Dendrite) unless (i) Employee is
permitted to participate in other plans providing Employee
with substantially comparable benefits (at substantially
comparable cost with respect to the Welfare Plans), (ii) any
such Welfare Plan does not provide material benefits to
Employee (determined in relation to Employee's compensation
and benefits package), (iii) such failure or action is taken
at the direction of Employee or with his consent, or (iv) such
failure or action is required by law; or
(v) the failure of Dendrite to obtain, an agreement
from a successor employer to assume Dendrite's obligations
under this Agreement in the event of a "Change in Control".
Employee must notify Dendrite of any event constituting Good Reason within
ninety (90) days following Employee's knowledge of its existence, it being
understood that Employee's failure to do so shall deem such event not to
constitute Good Reason under this Agreement.
(e) For purposes of this Agreement, "Disabled" as used herein shall
have the same meaning as that term, or such substantially equivalent term, has
in any group disability policy carried by Dendrite. If no such policy exists,
the term "Disabled" shall mean the occurrence of any physical or mental
condition which materially interferes with the performance of Employee's
customary duties in his capacity as an employee where such disability has been
in effect for a consecutive six (6) month period (excluding permitted vacation
time), the existence of which is supported by credible medical evidence.
2. Except as expressly modified by this Amendment, all of the terms and
conditions of the Agreement shall remain in full force and effect.
IN WITNESS WHEREOF, the parties have signed this Amendment as of the
first date written above.
DENDRITE INTERNATIONAL, INC.
XXXX X. XXXXXX
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Name: Xxxx X. Xxxxxx
Title: President and Chief Executive Officer
XXXXXXXXX XXXXXXXXXX
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Xxxxxxxxx Xxxxxxxxxx
