EXHIBIT 10.28
Execution Copy
EXECUTIVE EMPLOYMENT AGREEMENT
THIS EXECUTIVE EMPLOYMENT AGREEMENT (the "Agreement") by and between
Manhattan Associates, Inc., a Georgia corporation ("Company"), and Xxxxx X.
Xxxxxxxxxx ("Executive") is hereby entered into and effective as of February 25,
2004 (the "Effective Date").
WHEREAS, Company is engaged in the development, marketing, selling,
implementation and installation of computer software solutions specifically
designed for the management of warehouse and distribution centers and providing
transportation management for consumer product manufacturers, retailers and
retail and grocery suppliers and distributors (the "Company Business");
WHEREAS, Company desires to employ Executive, and Executive desires to
accept said employment by Company; and
WHEREAS, Company and Executive have agreed upon the terms and
conditions of Executive's employment with Company, and the parties desire to
express the terms and conditions in this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
set forth herein, it is hereby agreed as follows:
1. Employment and Duties.
A. Company shall employ Executive as its President and
Chief Operating Officer effective as of April 12, 2004, and continuing through
June 30, 2004, in accordance with the terms and conditions set forth in this
Agreement. Executive hereby accepts employment on the terms set forth herein. As
President and Chief Operating Officer, Executive shall report to the Chief
Executive Officer of the Company. Effective as of July 1, 2004, the Company
shall employ Executive as President and Chief Executive Officer, and Executive
shall report solely to the Board of Directors. The Company shall take such
actions as necessary to cause Executive to be elected as a member of the Board
of Directors effective as of July 1, 2004, or as soon thereafter as practicable.
B. While serving as President and Chief Operating
Officer, Executive shall have such duties as are determined from time to time by
the Chief Executive Officer that are consistent with such positions and such
other services and duties as are incident to such positions. While serving as
President and Chief Executive Officer, Executive shall be responsible for the
active management of the Company and its business, the performance of such other
services and duties as are incident to such positions, and the performance of
such other duties as may be determined from time to time by the Board of
Directors that are consistent with such positions. As President and Chief
Executive Officer, all officers of the Company and its subsidiaries (excluding
the Chairman of the Board, the Vice Chairman of the Board, any internal auditor
and such other officers as the Board of Directors and Executive shall agree)
shall report to the Executive, and the Executive shall have the authority,
consistent with guidelines adopted by the Board, to hire, terminate and
determine the compensation of such officers and other employees of the Company
and its subsidiaries. The Executive's duties shall include, without additional
compensation, the performance of similar services for any affiliates of the
Company as may be reasonably requested by the Board from time to time. The
Executive will not engage in any other business activity that would interfere
with the performance of his duties, services and responsibilities hereunder or
that are in violation of policies established from time to time by the Company
and provided to the Executive.
C. Executive agrees that he shall at all times
faithfully and to the best of his ability and experience perform all of the
duties that may be required of him pursuant to the terms of this Agreement.
Executive shall devote his full business time to the performance of his
obligations hereunder. The Executive will use his best efforts to promote the
interests of the Company. The Executive shall conduct himself at all times in a
business-like and professional manner as appropriate for his position and shall
represent the Company in all respects as complies with good business and ethical
practices. Executive shall be subject to and abide by the written policies and
procedures of the Company applicable
to personnel of the Company, as adopted from time to time and communicated to
Executive or made generally available to all employees.
D. Executive's primary place of business and Company's
headquarters will be based in the Atlanta, Georgia greater metropolitan area.
2. Compensation.
A. Base Salary. During his employment hereunder, Company
shall pay to Executive a base salary of $29,167 per month ($350,000 annualized),
subject to all payroll and income tax and other authorized deductions, which
amount may be increased annually at the discretion of the Board of Directors.
B. Performance-Related Bonus. Executive shall be
eligible to receive a performance-related bonus of $450,000 per year (prorated
for any years of partial service). The award of such bonus shall be determined
by the Compensation Committee of the Board of Directors in its reasonable
discretion based on financial information compiled by the Company's independent
auditors. Bonuses shall be paid by the Company by the later of (i) 60 days of
the end of the fiscal year, or (ii) the earlier of (a) the date on which a
determination may reasonably and administratively be made as to the operating
results for the Company as to the fiscal year for which the bonus is calculated,
or (b) the date that audited financial statements for the fiscal year for which
the bonus is calculated are available and approved by the board of directors.
Such bonus shall be subject to all payroll and income tax and other authorized
deductions. The bonus calculated for any fiscal year will be earned and accrued
and payable to Executive if Executive is employed by Company on the last day of
the fiscal year, regardless of whether his employment is thereafter terminated
by Company or Executive.
C. Stock Options. On or about April 12, 2004, the
Company will grant to Executive an option to purchase 400,000 shares of
Company's common stock either pursuant to the Manhattan Associates, Inc. Stock
Incentive Plan or on terms similar to grants typically made thereunder. Starting
in 2005 and for as long as the Executive is employed as the Company's President
and Chief Executive Officer (provided, however, that this provision is not
intended to authorize Company to change Executive's position without his
consent), the Executive will receive options to purchase an additional 100,000
shares of the Company's common stock on April 1 of each year. All of the options
set forth above will vest in 16 equal quarterly installments beginning on June
30 of the year of the grant. In the event of a Change of Control of the Company
(as defined below), all options, whether vested or non-vested, shall vest as of
the date of the Change of Control. The options will be subject to the other
terms in accordance with the stock option certificate provided for each grant.
At the option of the Company, in lieu of one or more of the annual grants of
options for 100,000 shares, the Company may substitute (in whole or in part) a
grant to Executive of shares of the Company's common stock pursuant to a
restricted stock grant under the Manhattan Associates, Inc. Stock Incentive Plan
at a rate of one share of restricted stock for each four option shares and
vesting on the same terms as the annual option grant. All options will (i) be
"incentive stock options" within the meaning of Section 422 of the Internal
Revenue Code to the maximum extent permitted by Section 422 and the terms of the
Plan under which the options are granted, (ii) have an exercise price per share
not exceeding the trading price per share of common stock on the date of grant
or the first business day preceding the date of grant, (iii) have at least a
ten-year term, subject to earlier termination upon termination of employment,
and (iv) will be exercisable for at least 90 days following Executive's
termination of employment other than termination by the Company for "Cause" as
defined in the "Separation Agreement" (as defined in Section 12 hereof).
D. Restricted Stock. On or about April 12, 2004, the
Executive will be granted 10,000 shares of the Company's common stock pursuant
to a restricted stock grant under the Manhattan Associates, Inc. Stock Incentive
Plan, which shares shall vest in four equal annual installments beginning March
30, 2005. Such shares shall also vest as of the date of a Change of Control.
E. Employee Benefits. Executive shall be entitled to
participate at a level that is at least as favorable to Executive as any other
executive level employee at Company, in all employee benefit plans that Company
provides for its employees at the executive level, including indemnification
from liability in the manner extended to other executive officers of the
Company.
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F. Expenses. Executive shall be reimbursed for expenses
reasonably incurred in the performance of his duties hereunder in accordance
with the written policies of Company then in effect.
G. Vacation. Executive shall accrue 15 business days of
vacation for 2004 and for each calendar year thereafter, 20 business days of
vacation.
H. Change of Control. "Change of Control" shall mean the
happening of an event that shall be deemed to have occurred upon the earliest to
occur of the following events: (i) the date the shareholders of the Company (or
the Board, if shareholder action is not required) approve a plan or other
arrangement pursuant to which the Company will be dissolved or liquidated; (ii)
the date the shareholders of the Company (or the Board, if shareholder action is
not required) approve a definitive agreement to sell or otherwise dispose of all
or substantially all of the assets of the Company; or (iii) the date the
shareholders of the Company (or the Board, if shareholder action is not
required) and the shareholders of the other constituent corporations (or their
respective boards of directors, if and to the extent that shareholder action is
not required) have approved a definitive agreement to merge or consolidate the
Company with or into another corporation, other than, in either case, a merger
or consolidation of the Company in which holders of shares of the Company's
voting capital stock immediately prior to the merger or consolidation will have
at least fifty percent (50%) of the ownership of voting capital stock of the
surviving corporation immediately after the merger or consolidation (on a fully
diluted basis), which voting capital stock is to be held by each such holder in
the same or substantially similar proportion (on a fully diluted basis) as such
holder's ownership of voting capital stock of the Company immediately before the
merger or consolidation.
I. Excise Taxes. In the event any payment and benefits
payable to Executive under this Agreement or the Separation Agreement, are
subject to an excise tax under Section 4999 of the Internal Revenue Code or any
similar successive statute, Company will pay Executive such additional
compensation as is necessary to put Executive in the same after-tax position
(taking into account income, payroll and excise taxes) as if no such excise tax
had been incurred, but in no event shall such additional compensation exceed
$1,000,000.
3. Term. This Agreement is effective as of the Effective Date
when signed by both parties, except that Executive's employment and compensation
therefor will not commence until April 12, 2004, and shall terminate on April
12, 2008. Executive and Company can extend Executive's employment hereunder
beyond April 12, 2008 by mutual written agreement. Upon the termination of
Executive's employment, Executive shall return immediately to Company all
documents and other property of Company, together with all copies thereof,
including all Work Product and Proprietary Information, within Executive's
possession or control.
4. Definitions. For purposes of this Agreement, "Work Product"
shall mean the data, materials, documentation, computer programs, inventions
(whether or not patentable), and all works of authorship, including all
worldwide rights therein under patent, copyright, trade secret, confidential
information, or other property right, created or developed in whole or in part
by Executive while performing services in furtherance of or related to the
Company Business.
For purposes of this Agreement, "Proprietary
Information" means all Trade Secrets and Confidential Information of
Company.
For purposes of this Agreement, "Trade Secrets"
means information of Company which is not commonly known by or
available to the public and which (i) derives economic value from not
being known to, and not readily ascertainable by proper means, by
other persons who can obtain economic value from its disclosure or
use, and (ii) is the subject of efforts that are reasonable under the
circumstances to maintain its secrecy.
For purposes of this Agreement, "Confidential
Information" shall mean Company information in whatever form, other
than Trade Secrets, that is of value to its owner and is treated as
confidential.
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5. Ownership.
A. All Work Product will be considered work made for
hire by Executive and owned by Company. To the extent that any Work Product may
not by operation of law be considered work made for hire or if ownership of all
rights therein will not vest exclusively in Company, Executive assigns to
Company, now or upon its creation without further consideration, the ownership
of all such Work Product. Company has the right to obtain and hold in its own
name copyrights, patents, registrations, and any other protection available in
the Work Product. Executive agrees to perform any acts as may be reasonably
requested by Company to transfer, perfect and defend Company's ownership of the
Work Product.
B. To the extent any materials other than Work Product
are contained in the materials Executive delivers to Company or its Customers,
Executive grants to Company an irrevocable, nonexclusive, worldwide,
royalty-free license to use and distribute (internally or externally) or
authorize others to use and distribute copies of, and prepare derivative works
based upon, such materials and derivative works thereof. Executive agrees that
during his or her employment, any money or other remuneration received by
Executive for services rendered to a Customer belong to Company.
For purposes of this Agreement, "Customers" shall
mean any current customer or prospective customer of Company.
6. Trade Secrets and Confidential Information.
A. Company may disclose to Executive certain Proprietary
Information. Executive agrees that the Proprietary Information is the exclusive
property of Company (or a third party providing such information to Company) and
Company (or such third party) owns all worldwide copyrights, trade secret
rights, confidential information rights and all other property rights therein.
B. Company's disclosure of the Proprietary Information
to Executive does not confer upon Executive any license, interest or rights in
or to the Proprietary Information. Except in the performance of services for
Company, Executive will hold in confidence and will not, without Company's prior
written consent, use, reproduce, distribute, transmit, reverse engineer,
decompile, disassemble or transfer, directly or indirectly, in any form, or for
any purpose, any Proprietary Information communicated or made available by
Company to or received by Executive. Executive agrees to notify Company
immediately if he discovers any unauthorized use or disclosure of the
Proprietary Information.
C. Executive's obligations under this Agreement with
regard to (i) Trade Secrets shall remain in effect for as long as such
information remains a trade secret under applicable law, and (ii) Confidential
Information shall remain in effect during Executive's employment with Company
and for three years thereafter. These obligations will not apply to the extent
that Executive establishes that the information communicated (1) was already
known to Executive, without an obligation to keep it confidential at the time of
its receipt from Company; (2) was received by Executive in good faith from a
third party lawfully in possession thereof and having no obligation to keep such
information confidential; or (3) was publicly known at the time of its receipt
by Executive or has become publicly known other than by a breach of this
Agreement or other action by Executive.
7. Non-Solicitation.
A. Customers. The relationships made or enhanced during
Executive's employment with Company belong to Company. During Executive's
employment and the one year period beginning immediately upon the termination of
Executive's employment with Company for any reason (the "One Year Limitation
Period"), Executive will not, without Company's prior written consent, contact,
solicit or attempt to solicit, on his own or another's behalf, any Customer with
whom Executive had contact in the one year prior to the end of Executive's
employment with Company for any reason (the "One Year Restrictive Period") with
a view of offering, selling or licensing any program, product or service that is
competitive with the Company Business.
B. Employees/Independent Contractors. During Executive's
employment and the One Year Limitation Period, Executive will not, without
Company's prior written consent, call upon, solicit, recruit or assist others in
calling upon, soliciting or recruiting to the employment of another business any
person who is or was within 6 months of such time an employee of Company.
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8. Acknowledgments. The parties hereto agree that: (i) the
restrictions contained in this Agreement are fair and reasonable in that they
are reasonably required for the protection of Company; (ii) by having access to
information concerning employees and customers of Company, Executive shall
obtain a competitive advantage as to such parties; (iii) the covenants and
agreements of Executive contained in this Agreement are reasonably necessary to
protect the interests of Company in whose favor said covenants and agreements
are imposed in light of the nature of Company's business and the involvement of
Executive in such business; (iv) the restrictions imposed by this Agreement are
not greater than are necessary for the protection of Company in light of the
substantial harm that Company will suffer should Executive breach any of the
provisions of said covenants or agreements; and (v) the covenants and agreements
of Executive contained in this Agreement form material consideration for this
Agreement.
9. Remedy for Breach. Executive agrees that the remedies at law
Sof Company for any actual or threatened breach by Executive of the covenants
contained in Sections 5 through 8 of this Agreement would be inadequate and that
Company shall be entitled to specific performance of the covenants in such
paragraphs or injunctive relief against activities in violation of such
paragraphs, or both, by temporary or permanent injunction or other appropriate
judicial remedy, writ or order, in addition to any damages and legal expenses
(including attorney's fees) that Company may be legally entitled to recover.
Executive acknowledges and agrees that the covenants contained in Sections 5
through 8 of this Agreement shall be construed as agreements independent of any
other provision of this or any other agreement between the parties hereto, and
that the existence of any claim or cause of action by Executive against Company,
whether predicated upon this or any other agreement, shall not constitute a
defense to the enforcement by Company of said covenants.
10. No Prior Agreements. Executive hereby represents and warrants
to Company that the execution of this Agreement by Executive and Executive's
employment by Company and the performance of Executive's duties hereunder shall
not violate or be a breach of any agreement with a former employer, client or
any other person or entity.
11. Assignment; Binding Effect. Executive understands that
Executive has been selected for employment by Company on the basis of
Executive's personal qualifications, experience and skills. Executive agrees,
therefore, that Executive cannot assign all or any portion of Executive's
performance under this Agreement. Company can assign this Agreement only to a
purchaser of all or substantially all of the assets of the Company. Subject to
the preceding two (2) sentences and the express provisions of Section 14 below,
this Agreement shall be binding upon, inure to the benefit of and be enforceable
by the parties hereto and their respective heirs, legal representatives,
successors and assigns.
12. Complete Agreement. This Agreement is not a promise of future
employment. Executive has no oral representations, understandings or agreements
with Company or any of its officers, directors or representatives covering the
same subject matter as this Agreement. This Agreement, together with the
Separation and Non-Competition Agreement of even date hereof between Company and
Executive (the "Separation Agreement"), hereby supersedes any other employment
agreements or understandings, written or oral, between Company and Executive.
This written Agreement, together with the Separation Agreement, is the final,
complete and exclusive statement and expression of the agreement between Company
and Executive regarding the subject matter thereof, and it cannot be varied,
contradicted or supplemented by evidence of any prior or contemporaneous oral or
written agreements. This written Agreement may not be later modified, except by
a further writing signed by Executive and an officer of Company acting with
specific authorization and approval of the Board of Directors, and no term of
this Agreement may be waived except by writing signed by the party waiving the
benefit of such term (and in the case of Company, with specific authorization
and approval of the Board of Directors.
13. Notice. Whenever any notice is required hereunder, it shall be
given in writing addressed as follows:
To Company: Manhattan Associates, Inc.
0000 Xxxxx Xxxxx Xxxx
0(xx) Xxxxx
Xxxxxxx, Xxxxxxx 00000
Attention: Chairman of the Board
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To Executive: Xxxxx X. Xxxxxxxxxx
Manhattan Associates, Inc.
0000 Xxxxx Xxxxx Xxxx
0xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
Notice shall be deemed given and effective three (3) days
after the deposit in the U.S. mail of a writing addressed as above and
sent first class mail, certified, return receipt requested, or when
actually received. Either party may change the address for notice by
notifying the other party of such change in accordance with this
Section 13.
14. Severability; Headings. If any portion of this Agreement is
held invalid or inoperative, the other portions of this Agreement shall be
deemed valid and operative and, so far as is reasonable and possible, effect
shall be given to the intent manifested by the portion held invalid or
inoperative. The Section headings herein are for reference purposes only and are
not intended in any way to describe, interpret, define or limit the extent or
intent of the Agreement or of any part hereof.
15. Counterparts. This Agreement may be executed simultaneously in
two (2) or more counterparts, each of which shall be deemed an original and all
of which together shall constitute, but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the day and year first above written.
COMPANY:
Manhattan Associates, Inc.
By:/s/ Xxxxxxx X. Xxxxxxxx
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Name: Xxxxxxx X. Xxxxxxxx
Title: President and CEO
Date: February 25, 2004
EXECUTIVE:
/s/ Xxxxx X. Xxxxxxxxxx
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Xxxxx X. Xxxxxxxxxx
Date: February 25, 2004
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