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Exhibit 10.25
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement") is made as of May 12, 1998, by
and between XXXXX XXXXX (the "Employee") and ZAI*NET SOFTWARE, L.P., a Delaware
limited partnership (the "Company") with reference to the following facts. Any
capitalized terms not otherwise defined herein shall have the respective
definitions as set forth in the Amended and Restated Limited Partnership
Agreement, dated as of the date hereof (the "Partnership Agreement").
WHEREAS, the Company desires to employ Employee as Executive Vice
President and Employee desires to be so employed on the terms and conditions
hereinafter set forth;
NOW THEREFORE, in consideration of the premises and the mutual
covenants and agreements hereinafter contained the parties hereby agree as
follows:
1. Employment.
1.1 Position and Duties. Employee shall be employed as
Executive Vice President of the Company upon the terms and provisions set forth
in this Agreement. Employee hereby accepts such employment on the terms and
conditions set forth herein. Employee agrees to devote his full time and best
efforts, skills and abilities to the business and affairs of the Company;
provided, however, that the foregoing shall not limit Employee from performing
charitable activities, managing personal passive investments or serving on the
board of directors of another entity to the extent that such outside activities
do not in any material way detract from Employee's performance of his duties
hereunder and are in compliance with Employee's Covenant Not to Compete dated
as of even date herewith. Employee shall perform all duties and have all
responsibilities consistent with the officer position indicated above as
specified by the Management Committee of the Company, provided that such duties
and responsibilities are commensurate with Employee's title, function and
position. Employee shall perform his duties principally at the Company's office
located in Houston, Texas (where Employee shall be based); provided, however,
Employee acknowledges that he will be required to travel in the ordinary course
of the Company's business as the reasonable needs of the Company shall require.
Notwithstanding the foregoing, the Company shall not relocate Employee from
Houston, Texas without Employee's consent.
1.2 Reporting. Employee shall report to the President of the Company.
2. Term. The term of this Agreement ("Term") shall commence as
of the date hereof and continue in full force and effect until three (3) years
from the date hereof, unless sooner terminated pursuant to the provisions of
this Agreement.
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3. Compensation and Benefits.
3.1 Base Salary. As compensation for the services to be
performed by Employee during the Term, the Company shall pay Employee a base
salary of One Hundred Fifty Thousand Dollars ($150,000), per annum, payable in
accordance with the Company's payroll practices in effect from time to time,
but not less often than monthly (as such amount may be increased by the
Management Committee pursuant to periodic reviews in accordance with Section
3.3 below, the "Base Salary"). Base Salary shall be payable in substantially
equal installments and reduced on a pro-rata basis for any fraction of a year
or month during which Employee is not so employed.
3.2 Bonus. During the Term, Employee shall be eligible
to participate in the Company's annual profit sharing plan for its key
employees (the "Annual Plan"), in accordance with the terms thereof as in
effect from time to time. Any such bonus earned by Employee shall be paid
annually not later than thirty (30) days after completion of the Company's
annual fiscal year audit or, upon mutual agreement of the parties, in another
fashion, subject to Employee being employed by the Company upon the date of
payment of any such bonus.
3.3 Periodic Review. The Management Committee shall
review Employee's compensation not less frequently then every twelve (12)
months. Following such review, the Management Committee may, in its
discretion, increase (but not decrease) Employee's compensation (including, in
the discretion of the Management Committee, Employee's Base Salary) for the
unexpired portion of the Term.
3.4 Reimbursements. Employee shall be reimbursed for all
reasonable travel, entertainment and other reasonable business expenses
incurred by Employee in the performance of his duties hereunder, including
expenses incurred in connection with Employee's use of a cellular phone, a
pager and a dedicated home telephone line used for Company business. The
Company shall reimburse Employee upon presentation to the Company of receipts
and an itemized accounting of such expenses in accordance with the Company's
reimbursement policy which is provided to Employee in writing.
3.5 Deductions and Withholding of Taxes. There shall be
deducted or withheld from any amounts payable to Employee for all federal,
state, city or other taxes required by applicable law to be so withheld or
deducted, standard Employee deductions (e.g., social security and state
disability insurance) and any other amounts authorized for deduction by
Employee or required by law.
3.6 Additional Benefits. Employee shall be entitled to
receive other benefits in accordance with the Company's then-current benefits
policies for senior executives of the Company, including, without limitation,
the following: (i) long term disability and life insurance plans for Employee,
(ii) health, hospitalization and major medical insurance plans, and (iii)
benefits similar to those described in clause (ii) for Employee and Employee's
wife and children. Employee shall be entitled to an automobile allowance of up
to $350 per month for the purchase or lease of an automobile. In addition
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thereto, Employee shall be entitled to reimbursement for membership in the
Harvard University Club not to exceed One Thousand Two Hundred Dollars ($1,200)
per year.
4. Vacation. Employee shall be entitled to four (4) weeks of
paid vacation in each calendar year. Employee shall be entitled to have
accrued no more than five (5) weeks unused vacation at any given time; any
unused vacation time in excess of such amount shall be cancelled.
5. Termination of Employment. Except as otherwise provided
herein, Employee's employment and all rights of Employee hereunder shall
terminate upon the termination of this Agreement, and neither Employee nor his
successors will have any rights hereunder, except with respect to compensation
earned by and payable to Employee hereunder prior to the effective date of such
termination and except with respect to any rights or monies vested in
Employee's 401(k) plan or other benefit plans in which Employee was
participating at the time of such effective date (collectively, "Earned and
Vested Benefits"). This Agreement and the employment of Employee shall
terminate only upon the occurrence of any of the following events effective
upon the satisfaction of the specified conditions and the expiration of any
notice periods after the delivery of any required notices.
5.1 Mutual Agreement. The Company and Employee may
mutually agree in writing to the termination of this Agreement, including the
extent of the continuation of rights and obligations of the Company and
Employee.
5.2 Termination for Cause. The Company may terminate
this Agreement for "Cause", as defined below, at any time such Cause exists, by
written notice to the Employee. In the event the Company elects to terminate
Employee for Cause, the Management Committee of the Company shall send written
notice to Employee terminating such employment, indicating the basis for such
termination and specifying the termination date. "Cause" for termination of
this Agreement by the Company shall mean any of the following acts or
circumstances of Employee: (i) willful destruction of Company property having
a material value to the Company; (ii) fraud, embezzlement, theft, or comparable
dishonest activity (excluding acts involving a de minimis dollar value and not
related to the Company); (iii) conviction of or entering a plea of guilty or
nolo contendere to any crime constituting a felony or any misdemeanor involving
fraud, dishonesty or moral turpitude (excluding acts involving a de minimis
dollar value and not related to the Company); (iv) breach, neglect, refusal, or
failure to materially discharge the duties under this Agreement commensurate
with Employee's title and function; or (v) a willful and knowing material
misrepresentation to the Company, the Management Committee or any officer(s) to
whom the Employee reports. Notwithstanding the foregoing to the contrary,
prior to discharging Employee pursuant to clause (iv) of the immediately
preceding sentence, the Company shall give Employee at least fifteen (15) days'
prior written notice of any breach or failure and an opportunity to cure any
such breach or failure. In connection with a termination by the Company for
Cause, the Company shall pay all Earned and Vested Benefits. Except as set
forth in this Section 5.2 and Section 5.6, the Company shall have no further
obligations under this Agreement in
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connection with a termination of the Employee for Cause.
5.3 Termination Without Cause. Notwithstanding any other
provision of this Section 5, in the event that Employee's employment is
terminated by the Company without Cause or if Employee resigns for Good Reason
(hereinafter defined), Employee shall receive all Earned and Vested Benefits
and as a severance benefit, the Employee shall receive the Base Salary provided
for in Section 3 hereof throughout the remainder of the Term of this Agreement.
For purposes of this Agreement, "Good Reason" shall mean (i) a relocation of
Employee, without his prior written consent, outside of the Houston
Metropolitan area (excluding a relocation to New York City to work in the
Company's headquarters), (ii) a failure to maintain Employee in a management
position substantially equivalent to that provided for in Section 1.1 hereof,
(iii) a material diminution by the Company of Employee's responsibilities which
change would cause Employee's position at the Company to become one of less
responsibility, importance or scope or (iv) a willful failure in bad faith to
pay the Base Salary or bonus to Employee when due or another material breach of
this Agreement by the Company that has a material adverse effect on Employee.
All amounts due Employee under this Section shall be paid to Employee without
offset for any amounts earned by Employee in any other employment or from any
other source. Except as set forth in this Section 5.3, Section 5.6 and Section
5.8, the Company shall have no further obligations under this Agreement in
connection with a termination of Employee without Cause or a resignation of
Employee for Good Reason.
5.4 Death/Disability. This Agreement shall terminate
automatically upon the death of Employee. For the purposes of this Agreement,
"Disability" shall mean that (i) for any period of one hundred and twenty (120)
consecutive days, or for one hundred and twenty (120) days in any period of two
hundred and seventy (270) consecutive days, Employee is absent or unable to
perform Employee's duties with the Company on a full time basis as a result of
incapacity due to mental or physical illness. Employee may be terminated by
written notice to Employee from the Company at any time after the Employee
meets the definition of Disability upon one (1) month's prior notice provided
that Employee does not return to his employment substantially in his full
capacity during such one (1) month period. In the event of the death or
Disability of the Employee, the Company shall pay Employee (or any estate,
beneficiary or legal representative of Employee) all Earned and Vested
Benefits. Except as set forth in this Section 5.4, Section 5.6 and Section
5.7, the Company shall have no further obligations under this Agreement in
connection with a death or Disability of Employee.
5.5 Termination by Employee. Except as provided in
Section 5.6 below, in the event that Employee unilaterally elects to terminate
his employment, the Company shall have no further obligations to make any
payments under this Agreement and Employee shall forfeit any right to such
payments, except for Earned and Vested Benefits.
5.6 Purchase Option in Partnership Interests. Upon the
occurrence of any of the events set forth in Sections 5.1 (within three (3)
years of the date hereof), 5.2, 5.4 (in the event of Disability, only if such
Disability results in Employee ceasing to have
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legal capacity to contract) and 5.5 (within three (3) years of the date hereof)
then prior to the completion of a Qualified Public Offering (collectively the
"Option Events"), the Company shall have the right and option, in the
discretion of the Management Committee of the Company, to purchase (the
"Purchase Option"), at any time during the ninety (90) days following the
occurrence of an Option Event, all of the Securities (as defined in Appendix B
to the Partnership Agreement) then owned, directly or indirectly, by Employee
(including, without limitation, those Securities held, indirectly through
ZAI*NET Software, Inc. or Rooney Software, L.L.C.), including all such
Securities acquired by any other Person pursuant to a Permitted Transfer and
including any interests therein of any holding company, legal representative,
estate, beneficiary, executor, administrator or trustee of the Employee (the
"Representative"); provided, however, upon death or Disability (resulting in
cessation of legal capacity to contract) of Employee, to the extent that (i)
all of the Securities subject to the Purchase Option will, following such
event, be controlled (as to powers of voting and disposition) solely by Xxxxxxx
Xxxxxxxxx (subject to her valid marriage to Xxxxx Xxxxx), and provided that
such person remains the spouse of Employee at the date of death or Disability
("Spouse"), and (ii) in the event of death, the entire beneficial ownership
interest in the Securities that would otherwise be subject to the Purchase
Option is transferred to Spouse or collectively to the children of Employee and
Spouse (including for purposes hereof any trust established for estate planning
purposes in which Spouse and such children are the only beneficiaries), the
occurrence of the death or Disability of Employee shall not constitute an
Option Event. The price to exercise the Purchase Option shall be determined in
accordance with the Appraised Value as set forth in Appendix B to the
Partnership Agreement. The exercise of the Purchase Option shall be by means
of a written notice of exercise (the "Notice") delivered by the Company to the
Employee and/or Representative. Payment for such Securities shall be made in
cash in three (3) equal installments, with the first installment payable on
closing date of the exercise of the Purchase Option, which date shall be no
later than thirty (30) days following the Notice date or such longer period as
may be reasonably necessary to determine the Appraised Value, and the two (2)
subsequent installment payments payable on the first and second anniversary
dates of such closing date. Each of the latter two payments shall include
interest computed at the rate of eight percent (8%) simple interest per annum,
payable in arrears on the unpaid amount of the purchase price. The Management
Committee shall have the option to transfer and assign the Purchase Option to
any designee.
5.7 Key Man Life Insurance; Put. During the Term of this
Agreement prior to Qualified Public Offering, the Company shall use
commercially reasonable efforts to maintain a key man insurance policy on the
life of the Employee for coverage equal to Two Million Five Hundred Thousand
Dollars ($2,500,000). The Company or GFI Caminus LLC as the General Partner of
the Company shall own such policy and be the beneficiary thereunder. Provided
that the Company is able to secure such insurance, in the event of Employee's
death prior to a Qualified Public Offering, the Representative shall have the
right (the "Put") to put Securities held by Employee (including such Securities
acquired by any other Person pursuant to a Permitted Transfer), whether owned
directly or indirectly through ZAI*NET (or any permitted assignee pursuant to
the Partnership Agreement), to the Company. Such Securities shall be valued in
the same
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manner as described in Section 5.6 above, and the amount thereof that may be
the subject of the Put shall not exceed the net proceeds actually obtained by
the Company pursuant to the foregoing life insurance policy. If properly
exercised, the Put shall be settled in cash promptly following receipt of
insurance proceeds by the Company. The Put shall be exercised, if at all, by
written notice from the Representative to the Company within sixty (60) days
following Employee's death. To the extent that the foregoing life insurance is
not available on commercially reasonable terms or an exclusion from coverage is
applicable, the Put shall not be available. Each Disposition of Securities
pursuant to a Put shall be free and clear of any and all liens, claims, charges
and encumbrances.
5.8 Put Option. Upon a termination of Employee's
employment by the Company without Cause prior to a Qualified Public Offering,
Employee shall have the right (the "Termination Put") to put Securities held by
Employee (including such Securities acquired by any other Person pursuant to a
Permitted Transfer) to the Company. Such Securities shall be valued in the
same manner as described in Section 5.6 above, and the payment terms of Section
5.6 shall apply equally to an exercise of the Termination Put. The Termination
Put shall be exercised, if at all, by written notice from the Employee to the
Company within sixty (60) days following termination without Cause. Each
Disposition of Securities pursuant to a Termination Put shall be free and clear
of any and all liens, claims, charges and encumbrances. The Management
Committee shall have the option to transfer and assign its obligations under
the Terminate Put to any designee.
6. Proprietary Rights.
6.1 Employee agrees that all intellectual property
rights, developments, designs, computer software, inventions, applications and
improvements, including but not limited to trade names, assumed names, service
names, service marks, trademarks, logos, patents, copyrights, licenses,
formulas, trade secrets and technology, whether in design, methods, processes,
formulae, machines or devices and all other applications (collectively,
"Employee Inventions"), whether made, created, invented, devised or developed
prior to the date of this Agreement for the Company or ZAI*NET or hereafter by
Employee during the rendition of his services hereunder, other than Employee
Inventions made, created, invented, devised or developed by Employee (i) on his
own personal time, (ii) without the use of the Company's facilities and
resources and (iii) which are not related to the Company Business and do not
otherwise relate to a matter governed or restricted by the Covenant Not to
Compete (collectively, "Unrelated Inventions"), are works made for hire and
shall be the exclusive property of the Company without separate compensation to
the Employee. Employee will, at the request and expense of the Company made at
any time, execute and deliver to the Company or its nominee such applications
and instruments as may be desirable and appropriate for obtaining for the
Company or its nominee, patents, copyrights, trademarks, know-how and other
intellectual property protection of the United States and all other countries
for vesting in the Company or its nominee, all of Employee's claim, right,
title and interest in said intellectual property rights, developments, designs,
computer software, inventions, improvements, applications and improvements and
for maintaining, enforcing and defending the same, and to otherwise vest in or
evidence the Company's exclusive ownership of all of the
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rights referred to herein. In the event that for whatever reason the results
of Employee's past or future work for the Company should not be deemed to be
works made for hire, Employee agrees to assign, and hereby does assign, to the
Company all claim, right, title and interest, in any country, to each and every
patent, copyright, trademark, computer software, know-how or other intellectual
property of any sort, other than Unrelated Inventions, that is the result of
work done in the course of the Employee's past or future employment by the
Company, or that the Employee creates or develops, in whole or in part by,
using the Company's equipment, supplies or facilities. Each and every such
assignment is and shall be in consideration of this Agreement with the Company,
and no further consideration therefor is or shall be provided to Employee by
the Company. Employee hereby waives enforcement of any moral or legal rights
which might limit the Company's rights to exploit any of the foregoing
materials in any manner. For all purposes of this Section 6, references to the
"Company" shall be deemed to include all predecessors entities and businesses.
Notwithstanding anything in the foregoing to the contrary, an Employee
Invention which is a software product shall not constitute an "Unrelated
Invention" unless Employee gives written notice to the Management Committee of
the Company of his intention to treat such Employee Invention as an "Unrelated
Invention", and the Management Committee of the Company, in its reasonable,
good faith determination, gives written notice to Employee of its concurrence
in such characterization.
6.2 Equitable Relief. Employee acknowledges that the
provisions contained in Section 6.1 hereof are reasonable and necessary to
protect the legitimate interests of the Company, that any breach or threatened
breach of such provisions will result in irreparable injury to the Company and
that the remedy at law for such breach or threatened breach would be
inadequate. Accordingly, in the event of the breach by Employee of any of the
provisions of Section 6.1 hereof, the Company, in addition and as a supplement
to such other rights and remedies as may exist in its favor, may apply to any
court of law or equity having jurisdiction to enforce this Agreement, and/or
may apply for injunctive relief against any act that would violate any of the
provisions of this Agreement (without being required to post a bond). Employee
further understands that monetary damages will not be sufficient to avoid or
compensate for a breach of the provisions contained in Section 6.1 hereof and
that injunctive relief would be appropriate to prevent any such breach or
threatened breach. Such right to obtain injunctive relief may be exercised, at
the option of the Company, concurrently with, prior to, after, or in lieu of,
the exercise of any other rights or remedies that the Company may have as a
result of any such breach or threatened breach.
7. Non-Disclosure/Non-Competition. As a condition to the
execution of this Agreement by the Company and as additional consideration
therefor, Employee shall concurrently herewith execute and deliver to the
Company a Covenant Not to Compete attached hereto as Exhibit A (the
"Non-Compete Agreement"), which is hereby incorporated by reference and shall
be deemed an integral part hereof. The Non-Compete Agreement shall survive the
termination of this Agreement or Employee's employment hereunder for any
reason.
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8. Miscellaneous.
8.1 Entire Agreement; Amendments. Except as provided in
Section 7 hereof, this Agreement constitutes the entire agreement between the
parties with respect to the employment of Employee by the Company and
supersedes any prior understandings, agreements or representations between the
parties, written or oral, to the extent they have related in any way to the
subject matter hereof. No amendment of any provision of this Agreement shall
be valid unless the same shall be in writing and signed by the Company and
Employee. No waiver by any party of any default, misrepresentation, or breach
of warranty or covenant hereunder, whether intentional or not, shall be deemed
to extend to any prior or subsequent default, misrepresentation, or breach of
warranty or covenant hereunder or affect in any way any rights arising by
virtue of any prior os subsequent such occurrence.
8.2 Arbitration. Except as otherwise provided in Section
6.2 hereof or otherwise required by law, any claim or controversy arising out
of or relating to the performance of this Agreement shall be settled by
mandatory arbitration in New York City, New York in accordance with the
Commercial Arbitration Rules of the American Arbitration Association then in
effect. Such claim or controversy shall be resolved by a three (3) arbitrator
panel selected as follows: one arbitrator selected by the Company, one
arbitrator selected by Employee and one arbitrator selected by each of the
arbitrators selected by each of the Company and Employee. Judgment upon the
arbitration award rendered by the arbitrators may be entered in any court
having jurisdiction thereof. All discovery shall be governed by the Federal
Rules of Civil Procedure. Either party may apply to any court having
jurisdiction hereof and seek injunctive relief so as to maintain the status quo
of the parties until such time as the arbitration award is rendered or the
claim or controversy otherwise resolved. The prevailing party in any such
matter shall recover all of its costs and expenses, including reasonable
attorneys' fees.
8.3 Notices. All notices under this Agreement will be in
writing and will be delivered by personal service or telegram, telecopy or
certified mail (if such service is not available, then by first class mail),
postage prepaid, or Federal Express (or other reputable overnight courier) to
such address as may be designated from time to time by the relevant party, and
which will initially be as set forth below. Any notice sent by certified mail
will be deemed to have been given three (3) days after the date on which it is
mailed. Notices sent by personal delivery shall be deemed effective on the date
delivered, notices sent by Federal Express (or other reputable overnight
courier) shall be deemed effective on the third business day following the
sending thereof and notices sent by telecopy shall be deemed effective on the
date delivered. No objection may be made to the manner of delivery of any
notice actually received in writing by an authorized agent of a party. Notices
will be addressed as follows or to such other address as the party to whom the
same is directed will have specified in conformity with the foregoing:
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If to Company:
ZAI*NET Software, L.P.
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: President
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
GFI Energy Ventures LLC
00000 Xxxxxxxx Xxxxxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxxxxx X. Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to Employee:
Xxxxx Xxxxx
c/o ZAI*NET Software, L.P.
0000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
Xxxxxxxx Xxxx & Brandeis, LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxx X. Xxxxxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
8.4 Third-Party Benefits. None of the provisions of this
Agreement will be for the benefit of, or enforceable by, any third-party
beneficiary, except that each designee selected by the Company pursuant to
Section 5.6 or Section 5.8, and GFI Caminus LLC in its capacity as General
Partner of the Company, are intended as a third-party beneficiary of all rights
of the Company hereunder.
8.5 Successors and Assigns. This Agreement will be
binding upon and inure to the benefit of the parties, their respective
successors and permitted assigns. None of the parties hereto may assign any of
their rights or obligations under this Agreement without the prior written
consent of all other parties hereto, except that this Agreement
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may be assigned by the Company to any corporation or other business entity that
succeeds to all or substantially all of the business of the Company through
merger, consolidation, corporate reorganization or by acquisition of all or
substantially all of the assets or capital stock of the Company, provided that
in the event of any such assignment, the services to be rendered by Employee to
such assignee shall be of the same nature and professional status provided for
in this Agreement.
8.6 Governing Law. All questions with respect to this
Agreement and the rights and liabilities of the parties shall be governed by
the laws of the State of New York, regardless of the choice of law provisions
of that state or any other jurisdiction.
8.7 Headings and Gender. The section headings contained
in this Agreement are inserted for convenience only and shall not affect in any
way the meaning or interpretation of this Agreement. All words shall be
construed to be of such gender and number as the circumstances require.
8.8 Severability. The validity, legality or
enforceability of the remainder of this Agreement will not be affected even if
one or more of the provisions of this Agreement will be held to be invalid,
illegal or unenforceable in any respect.
8.9 Attorneys' Fees. Subject to Section 8.2 hereof, if
any action or proceeding is brought to enforce or interpret any provision of
this Agreement, the prevailing party shall be entitled to recover as an element
of its costs, and not its damages, reasonable attorneys' fees and costs
incurred in connection with such action or proceeding.
8.10 Counterparts. This Agreement may be executed
simultaneously in two or more counterparts, each of which will be deemed an
original, but all of which together will constitute one and the same
instrument.
8.11 Survival. The provisions of Section 6 and Section 7
of this Agreement shall survive any termination of this Agreement.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
ZAI*NET SOFTWARE, L.P., a Delaware limited EMPLOYEE
partnership
By: /s/ Xxxxx Xxxxxxx /s/ Xxxxx Xxxxx
---------------------------------------- -------------------------
Xxxxx Xxxxx
Name: Xxxxx Xxxxxxx
Its: President
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