EXHIBIT 10.48
[LETTERHEAD OF SYSTEM SOFTWARE ASSOCIATES, INC.]
EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") is made and entered into as of the
27th day of April, 1998, by and between System Software Associates, Inc., a
Delaware corporation (hereinafter the "Company") and Xxxxxxxx X. Xxxxxxxxx
(hereinafter the "Employee").
WHEREAS, the Company desires that the Employee provide services for the benefit
of the Company (including, to the extent required, all subsidiary and related
companies of the Company; hereinafter collectively the "Affiliates") and the
Employee desires to accept such employment with the Company; and
WHEREAS, in the course of employment with the Company, the Employee will have
access to certain confidential information that relates to or will relate to the
business of the Company and its Affiliates and the Company desires that any such
information not be disclosed to other parties or otherwise use for unauthorized
purposes.
NOW, THEREFORE, in consideration of the above premises and the following terms
and mutual covenants, the parties agree as follows:
1. EMPLOYMENT. The Employee shall serve as Executive Vice President and
Chief Financial Officer. The Employee hereby accepts such employment and
position on the terms contained herein.
2. DUTIES AND EMPLOYEE LOYALTY. The Employee shall work for the Company in a
full-time capacity and shall have the duties, responsibilities, powers and
authority customarily associated with the position of Executive Vice President
and Chief Financial Officer, together with such other duties and functions as
are assigned from time to time by the undersigned or his designee. The Employee
shall report to the undersigned or his designee (hereinafter "Employee's
Manager"). The Employee shall devote his entire business time, attention,
energy, knowledge, and skill to the performance of duties for the Company and
will use his best efforts to promote the interests of the Company and its
Affiliates.
The Employee expressly agrees that during the term of this Agreement, he shall
not engage, directly or indirectly, as a partner, officer, director,
stockholder, advisor, agent, employee, or in any other form or capacity, in any
other business similar to that of the Company. The foregoing notwithstanding,
nothing herein contained shall be deemed to prevent the Employee from investing
in the capital stock or other securities of any corporation whose stock or
securities are publicly owned or are regularly traded on any public exchange.
3. TERM OF EMPLOYMENT. Unless sooner terminated as in accordance with Paragraph
7, this Agreement shall be entered into commencing as of April 27, 1998
(hereinafter the "Start Date") and shall thereafter continue until expiration in
accordance with the terms and conditions of this Agreement.
4. COMPENSATION. For all services rendered by the Employee to the Company, the
Company shall pay to the Employee during his period of employment the following
compensation:
BASE SALARY. The Employee shall be entitled to an annual base salary of
$300,000.00 (hereinafter "Base Salary") commencing as of the Start Date,
payable in substantially equal installments in accordance with the
Company's then current local payroll policy.
ANNUAL INCENTIVE BONUS. Up to $150,000.00, based on achievement of
specified organizational and personal management objectives (hereinafter
"Annual Incentive Bonus"). Employee agrees that incentive bonus payments
are not guaranteed income and are based upon actual performance and
achievement of established
objectives on a fiscal year or quarterly basis. The actual payment of
earned incentive bonus payments shall be made by the Company on a
periodic basis in accordance with the Company's then current payroll
policy.
ADJUSTMENTS TO BASE SALARY AND ANNUAL INCENTIVE BONUS. The Base Salary
and/or Annual Incentive Bonus may be increased (but may not be reduced,
unless there is a significant change in the Employee's duties and
responsibilities) by the Employee's Manager. To that end, the Employee
shall periodically receive a performance review in accordance with the
Company's then existing policies. For informational purposes only, the
Company's current policy provides for an annual performance review
(which may or may not, at the Company's option, include an adjustment in
the Employee's Base Salary and/or Annual Incentive Bonus).
ADDITIONAL COMPENSATION. The Employee is also be eligible to be
considered for participation, during the term of his/her employment, in
such other compensation programs as may be available by the Company from
time to time (commensurate with the Employee's position and
compensation).
GRANT OF STOCK OPTIONS. In accordance with the Company's Long Term
Incentive Plan, a grant of 250,000 stock options in the Company's common
stock will be requested of SSA's Board of Directors at their next
meeting. The strike price on these options will be the value of a share
of the Company's common stock at the close of market on April 27, 1998
and will, subject to Paragraph 7, below, vest as follows: 1/5th (50,000
stock options) on April 27, 1998; the remaining 4/5ths (200,000 stock
options) in four (4) equal installments (50,000 stock options per
installment) over a four (4) year employment period beginning on April
27, 1999. The grant of such stock options, in accordance with the
foregoing, will be memorialized in an option agreement pursuant to and
in accordance with the Company's Long Term Incentive Plan.
DEDUCTIONS. The Employee agrees that the Company shall withhold from any
and all compensation required to be made to the Employee under this
Agreement all federal, state, local and/or other taxes or payroll
deductions which the Company determines are required to be withheld in
accordance with applicable statutes and/or regulations from time to time
in effect or as otherwise withheld pursuant to the consent or agreement
of the Employee.
5. BENEFITS. During the term of this Agreement, the Employee shall be eligible
to participate in any life insurance, disability insurance, medical, dental, or
health insurance, vacation, savings, pension and retirement plans and other
benefit plans or programs as be maintained by the Company for the benefit of its
employees (commensurate with the Employee's position and compensation).
6. EXPENSES. During the term of this Agreement, the Company shall promptly
reimburse the Employee for all reasonable and approved business expenses
incurred by him in connection with the performance of his duties to the Company,
upon substantiation of such expenses in accordance with the policies of the
Company in effect from time to time.
7. TERMINATION. The Employee's services shall terminate upon the first to occur
of the following events:
TERMINATION WITHOUT CAUSE. The Company expressly reserves the right to
terminate the employment of the Employee hereunder other than for cause,
disability or death, as provided for below. In the event that the
Employee's employment shall have be so terminated by the Company other
than for cause, death, or disability, the Employee shall be entitled to
receive the equivalent of twenty-four (24) months Base Salary (as may
have been adjusted from time to time during the term of this Agreement
and in accordance with the terms hereof) (hereinafter "Twenty-Four Month
Severance Payment"). The Company will pay this Twenty-Four Month
Severance Payment on a lump sum basis within thirty (30) days of
termination. In addition, in the event that the Employee's employment
shall have been so terminated, the vesting period with respect to stock
options granted to the Employee pursuant to Paragraph 4, above, shall
accelerate so as to permit the Employee to exercise, in accordance with
the terms of SSA's Long Term Incentive Plan, any such stock options
which
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would have otherwise vested within a period of twenty-four (24) months
after the Employee's effective date of termination of employment.
Notwithstanding the foregoing, in the event that the Employee's
employment is terminated by the Company as a result of a Change in
Control (as defined below), the vesting period with respect to stock
options granted to the Employee pursuant to Paragraph 4, above, shall
accelerate as provided for below.
VOLUNTARY TERMINATION AND TERMINATION FOR CAUSE. The Employee's
termination may be voluntarily terminated by him at any time by giving
ninety (90) day written notice thereof to the Company (or such shorter
period of time as may be agreed upon by the Company). Additionally, the
Employee's employment may be terminated at any time for cause (as
hereinafter defined), effective immediately upon the giving of written
notice to the Employee.
If at any time during the term of this Agreement: (a) the Employee shall
have voluntarily terminated his employment with the Company or (b) the
Company shall have terminated the employment of the Employee for cause
(as hereinafter defined), the Employee shall be entitled to receive only
his Base Salary (as may have been adjusted from time to time during the
term of this Agreement and in accordance with the terms hereof) up to
the date of termination plus any accrued but unused vacation pay. The
Employee shall also be entitled to any benefits mandate under the
Consolidated Onmibus Budget Reconciliation Act of 1985 (COBRA) or
required under the terms of any death, insurance, or retirement plan,
program, or agreement provided by the Company and to which the Employee
is a party or in which the Employee is a participant, including, but not
limited to, any short-term or long-term disability plan or program, if
applicable.
For purposes of this Agreement, the Employee shall be deemed terminated
"for cause" if the Company terminates the Employee after the Employee:
(a) shall have been formally indicted (or the equivalent thereof) for
any felony including, but not limited to, a felony involving fraud,
theft, misappropriation, dishonesty, or embezzlement; (b) shall have
committed intentional acts of gross misconduct that materially impair
the goodwill or business of the Company or cause material damage to its
property, goodwill, or business; or (c) shall have refused to, or
willfully failed to, perform his material duties, provided, however,
that no termination under this subparagraph (c) shall be effective
unless the Employee does not cure such refusal or failure to the
Company's satisfaction as soon as practicable after the Company gives
the Employee written notice identifying such refusal or failure (and, in
any event, within thirty (30) calendar days after receipt of such
written notice). No act or failure to act on the part of the Employee
shall be considered "willful" unless it is done, or omitted to be done,
by the Employee in bad faith or without reasonable belief that his
action or omission was in the best interests of the Company.
TERMINATION DUE TO DISABILITY. This Agreement and any termination of
employment as a result of a disability shall be subject to the
disability policy as established by the Company from time to time.
TERMINATION DUE TO DEATH. In the event of the Employee's death during
the term of this Agreement, the Employee's employment hereunder shall
immediately terminate and, in such event, the Employee's estate shall be
entitled to receive the Employee's Base Salary (as may have been
adjusted from time to time in accordance with Paragraph 4, above) to the
last day of the month during which the Employee's death shall have
occurred and such additional benefits, if any, as may be provided by any
insurance or other benefits to which the Employee may have participated
in or otherwise become entitled to during his period of employment, as
established or maintained by the Company for its employees from time to
time.
TERMINATION DUE TO CHANGE OF CONTROL. The Employee's employment may be
terminated by him by written notice for a Good Reason (as hereinafter
defined) by giving ninety (90) days written notice thereof to the
Company (or such shorter period of time as may be agreed upon by the
Company), at any time within one hundred eighty (180) days following a
Change of Control (as defined below). In such event, the Employee
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shall bee entitled to receive a Twenty-Four Month Severance Payment as
described above. The Company will pay this Twenty-Four Month Severance
Payment on a lump sum basis within thirty (30) days of termination.
In the event that the Employee's employment shall have been terminated
by him in accordance with the foregoing or by the Company due to a
Change in Control, the vesting period with respect to all stock options
granted to the Employee pursuant to Paragraph 4, above, shall accelerate
so as to permit the Employee to exercise, in accordance with the terms
of SSA's Long Term Incentive Plan, all stock options which would have
otherwise vested in accordance with the terms of this Agreement.
The term "Good Reason" shall mean either: (a) the elimination of the
Employee's position or a material diminution in the Employee's
authority, functions, duties or responsibilities, which has occurred as
a result of a Change of Control (as hereinafter defined); or (b) a
failure by the Company to either reaffirm the Employee's current
position with the Company or offer the Employee a comparable position at
the same or greater compensation level with thirty (30) days following a
Change of Control (as defined below).
The term "Change of Control" shall mean a material change in the
management structure of the Company which has occurred as a result of
either: (a) a sale of a controlling interest of the Company to a third
party; (b) a sale of the Company to a third party of all or
substantially all of the Company's stock or assets; or (c) a merger of
the Company with another unrelated entity.
TREATMENT OF ANNUAL INCENTIVE BONUS UPON TERMINATION. In the event of
termination of the employment of the Employee for any reason, the
Employee shall be entitled to receive any Annual Incentive Bonus or
other compensation (other than Base Salary) in respect of the fiscal
quarter of the Company in which the termination shall take place; the
specific amount of the Annual Incentive Bonus and/or additional
compensation to be paid to the Executive to be: (a) prorated based upon
the earlier of the effective date of the Employee's termination of
employment or the date the Employee ceases to perform services on behalf
of the Company; and (b) dependent upon the Company's achievement of the
underlying bonus program to which the Annual Incentive Bonus and/or
other compensation relates. In addition, in the event that at the time
of his termination, the Employee is due, but has not yet received,
payment of any Annual Incentive Bonus, or portion thereof, or other
compensation (other than Base Salary), such amount(s) shall be paid to
Employee in accordance with the Company's payroll policy from time to
time in effect.
PAYMENT CONTINGENCIES. Payment to the Employee of the Twenty-Four Month
Severance Payment, together with any other amounts to be paid to the
Employee pursuant to this Paragraph 7, is contingent upon: (a) the
Employee signing an agreement that releases the Company from actions,
suits, claims, proceedings and demands related the period of employment
and/or the termination of the employment; (b) the Company being
permitted to offset from the severance pay hereunder any salary paid to
the Employee during the ninety (90) day notice period (or such shorter
period of time as may be provided for herein or otherwise agreed upon by
the Company) if the Employee performs no services during such notice
period; (c) the Employee returning, in good condition, all property
belonging to Company; and (d) the Employee remaining in compliance with
his obligations of confidentiality including, without limitation, the
Employee's adherence to the restrictions placed upon his subsequent
employment opportunities pursuant to Paragraph 8, below.
8. EMPLOYEE CONFIDENTIALITY OBLIGATIONS. The Employee acknowledges and agrees
that solely by virtue of his employment by, and relationship with the Company,
he will acquire confidential information relating to the Company and its
Affiliates; such confidential information to include, but is not limited to: (a)
any financial business, planning, operations, services, potential services,
products, potential products, technical information and/or know-how, formulas,
production, purchasing, marketing, sales, personnel, customer, broker, supplier,
or other information of the Company or Affiliates; (b) any papers, data,
records, processes, methods, techniques, systems, models, samples, devices,
equipment, compilations, invoices, customer lists, or documents of the Company
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or Affiliates; (c) any confidential information or trade secrets of any third
party provided to the Company in confidence or subject to other use of
disclosure restrictions or limitations; and (d) any other information, written,
oral, or electronic, whether existing now or at some time in the future, whether
pertaining to current or future developments, which pertains to the Company's or
Affiliate's affairs or interests or with whom or how the Company or Affiliates
conduct business (hereinafter collectively "Information").
The Employee further acknowledges and agrees that in consideration of the terms
and conditions set forth in this Agreement, including, without limitation, the
compensation to be paid to Employee hereunder, Employee shall sign and abide by
the terms and conditions of the Employee Confidentiality Agreement, attached
hereto and deemed a part hereof (hereinafter "Employee Confidentiality
Agreement"), including, without limitation, the restriction on Employee's
subsequent employment opportunities as set forth in Section 4 thereof. In
addition, the Employee acknowledges and agrees that the restrictions contained
in Section 4 of the Employee Confidentiality Agreement are necessary and
reasonable in order to protect the Company in the conduct of its business and
will not prevent Employee form earning a comparable livelihood following the
termination of his/her employment with the Company. Employee further agrees that
for a minimum period of one (1) year following the termination of his employment
with the Company, he shall disclose the existence and terms of the Employee
Confidentiality Agreement to each subsequent employer and hereby consents to and
the Company is hereby given permission to disclose the existence and terms of
the Employee Confidentiality Agreement to any such subsequent employer.
The Information described in this Paragraph 8 shall be deemed to be included in
this definition of "Proprietary Information" as set forth in the Employee
Confidentiality Agreement and shall be subject to the terms and conditions
contained therein.
9. ADDITIONAL PROVISIONS. The Company and the Employee further agree as
follows:
ASSIGNMENT. The Employee acknowledges that the services to be rendered
by him are unique and personal. Accordingly, the Employee may not assign
any of his rights or delegate any of his duties or obligations under
this Agreement. The rights and obligations of the Company under this
Agreement shall inure to the benefit of and shall be binding upon the
successors and assigns of the Company.
NOTICES. All notices required or permitted hereunder shall be in writing
and deemed effectively given upon personal delivery or upon deposit in
the United States mails, by registered or certified mail, postage
prepaid, addressed to the other party hereto at the address set forth in
the introductory paragraph of this Agreement, or at other address or
addresses as either party designate to the other in accordance with this
paragraph.
ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
between the parties, and supersedes all prior agreements and
understandings, relating to the subject matter hereof. If any provision
of this Agreement shall be found invalid or unenforceable for any
reason, in whole or in part, then such provision shall be deemed
modified, restrict, or reformulated to the extent and in the manner
necessary to render the same valid and enforceable, or shall be deemed
excised from this Agreement, as the case may require, and this Agreement
shall be construed and enforced to the maximum extent permitted by law,
as if such provision had been originally incorporated herein as so
modified, restricted, or reformulated or as if such provision had not
been originally incorporated herein, as the case may be.
AMENDMENT. This Agreement may be amended or modified only by a written
instrument executed by both the Company and the Employee.
HEADINGS. The Paragraph and subparagraph headings used in this Agreement
are for convenience only and shall not be deemed to be considered a
construction of the provisions hereof.
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IMMIGRATION AND REFORM CONTROL ACT OF 1986. This Agreement is contingent
upon submission by the Employee of the appropriate documentation for
verification in compliance with the Immigration and Reform Control Act
of 1986, as amended.
GOVERNING LAW. This Agreement shall be governed by and construed,
interpreted and enforced in accordance with the laws of the State of
Illinois.
THE EMPLOYEE HAS READ AND FULLY UNDERSTANDS THE TERMS AND CONDITIONS SET FORTH
IN THIS AGREEMENT, HAS HAD TIME TO REFLECT ON AND CONSIDER THE BENEFITS AND
CONSEQUENCES OF ENTERING INTO THIS AGREEMENT, AND HAS HAD THE OPPORTUNITY TO
REVIEW THE TERMS HEREOF WITH AN ATTORNEY OR OTHER REPRESENTATIVE, IF HE/SHE SO
CHOOSES.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first written at the introductory paragraph to this Agreement.
SYSTEM SOFTWARE ASSOCIATES, INC.
By: /s/ Xxxxxxx Xxxxx
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Typed or Printed Name: Xxxxxxx Xxxxx
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EMPLOYEE:
By: /s/ Xxxxxxxx X. Xxxxxxxxx
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Typed or Printed Name: Xxxxxxxx X. Xxxxxxxxx
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