EXHIBIT 10.2
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
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THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (the "Agreement"), is
entered into as of January 1, 2000 by MARKETFIRST SOFTWARE, INC. (the "Company")
and XXXXX X. XXXXXXX (the "Executive").
WHEREAS, the Company desires to secure the services of Executive as
President and Chief Executive Officer, and Executive desires to perform such
services for the Company on the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the premises and of the covenants
and agreements set forth below, it is mutually agreed as follows:
ARTICLE I
EMPLOYMENT
1.1 Term of Employment. The term of employment of Executive by the
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Company hereunder commenced on July 1, 1998 (the "Commencement Date") and shall
continue thereafter on the same terms and conditions for a period of four years
unless earlier terminated pursuant to Article IV (such term being hereinafter
referred to as the "Employment Period"). The Employment Period shall be
extended automatically without further action by either party as of the fourth
anniversary of the Commencement Date for a period of one year, unless prior to
such date the Company or the Executive shall notify the other in writing of its
or his intention not to renew the Agreement, in which case the Agreement shall
terminate at the end of the original term. If the Employment Period is
extended, it shall thereafter be referred to as the Employment Period.
1.2 Title, Duties. The Executive shall serve as President and Chief
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Executive Officer of the Company reporting to the Board of Directors of the
Company (the "Board"). Executive shall perform those duties and
responsibilities inherent in such positions, including such duties and
responsibilities as the Board shall assign. The Executive agrees to devote his
full time and best efforts, attention and energies to the business and interests
of the Company; provided, however, the Company acknowledges that Executive may
serve on the board of directors of other companies with the prior approval of
the Board. Executive shall travel as reasonably required in connection with the
performance of his duties hereunder.
ARTICLE II
COMPENSATION AND BENEFITS
2.1 Compensation. The Company shall pay and Executive shall accept as
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full consideration for his services hereunder, compensation consisting of the
following:
(a) Base Salary. $218,000 per year base salary, payable in
installments in accordance with the Company's normal payroll
practices, less such deductions or withholdings required by law.
(b) Bonus. A target bonus of $82,000 per year, payable quarterly upon
satisfaction of performance goals to be mutually agreed upon by
Executive and the Board within 90 days after the Commencement
Date and within 90 days after the beginning of each calendar year
thereafter. Such bonus was prorated for 1998.
(c) Stock Options. (a) Executive was granted a stock option for
2,263,549 shares of Common Stock of the Company (the "Option")
under the Company's 1996 Equity Incentive Plan which such Option
was awarded by the Compensation Committee on the Commencement
Date. The Option has an exercise price of not more than the fair
market value of the Company's Common Stock on the date of grant
and, subject to Article IV, shall become vested as to 25% of the
shares on the first anniversary of the Commencement Date and
2.08% of the shares monthly for thirty-six months thereafter on
the last day of each month during which Executive remains
employed with the Company. Executive shall be entitled to pay the
exercise price of the Option by tender of a secured full recourse
promissory note subject to the terms and conditions et forth in
the 1996 Equity Incentive Plan.
2.2 Benefits. Subject to all applicable eligibility requirements and
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legal limitations, Executive will be able to participate in any and all 401(k),
vacation, medical, dental, life and long-term disability insurance and/or other
benefit plans which from time to time may be established for other employees and
similarly situated executives of the Company.
2.3 Reimbursement of Expenses. The Company will reimburse Executive for
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all reasonable travel, entertainment and other expenses incurred or paid by the
Executive in connection with, or related to, the performance of his duties,
responsibilities or services under this Agreement subject to review by the
Compensation Committee of the Board.
2.4 Automobile Allowance. The Company shall provide the Executive with an
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automobile allowance in the amount of $1,800.00 per month as reimbursement to
the Executive of costs and expenses incurred by the Executive for the purchase
or lease and maintenance and operation of an automobile for use by the Executive
in the performance of the Executive's duties hereunder. Such automobile
allowance shall be paid in substantially equal semi-monthly installments.
2.5 Life Insurance. The Company shall reimburse the Executive for the
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premiums on a $1,000,000 life insurance policy; provided, however, that such
premiums shall not exceed $3,000.00 per year.
2.6 Annual Physical. The Company shall reimburse the Executive for all
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costs and expenses incurred by the Executive in connection with a complete
annual physical; provided, however, that such reimbursement shall not exceed
$1,000.00 per year.
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ARTICLE III
CONFIDENTIALITY AND NONSOLICITATION
3.1 The Executive acknowledges that during the Employment Period he will
receive confidential information from the Company and subsidiaries of the
Company and the respective clients thereof (each a "Relevant Entity").
Accordingly, the Executive agrees that during the Employment Period (as it may
be extended from time to time) and thereafter for a period of two years, the
Executive and his affiliates shall not, except in the performance of his
obligations to the Company hereunder or as may otherwise be approved in advance
by the Company, directly or indirectly, disclose or use (except for the direct
benefit of the Company) any confidential information that he may learn or has
learned by reason of his association with any Relevant Entity. Upon termination
of this Agreement, the Executive shall promptly return to the Company any and
all properties, records or papers of any Relevant Entity, that may have been in
his possession at the time of termination, whether prepared by the Executive or
others, including, but not limited to, confidential information and keys. For
purposes of this Agreement, "confidential information" includes all data,
analyses, reports, interpretations, forecasts, documents and information
concerning a Relevant Entity and its affairs, including, without limitation with
respect to clients, products, policies, procedures, methodologies, trade secrets
and other intellectual property, systems, personnel, confidential reports,
technical information, financial information, business transactions, business
plans, prospects or opportunities, (i) that the Company reasonably believes are
confidential or (ii) the disclosure of which could be injurious to a Relevant
Entity or beneficial to competitors of a Relevant Entity, but shall exclude any
information that the Executive is required to disclose under any applicable
laws, regulations or directives of any government agency, tribunal or authority
having jurisdiction in the matter or under subpoena or other process of law.
For purposes of this Agreement, "affiliate" means any entity that, directly or
indirectly, is controlled by, or under common control with, the Executive. For
purposes of this definition, the terms "controlled" and "under common control
with" means the possession, direct or indirect, of the power to direct or cause
the direction of the management and policies of such person, whether through the
ownership of voting stock, by contract or otherwise.
3.2 As a part of the consideration between the parties for this Agreement,
Executive hereby agrees to enter into the Company's Employee Invention
Assignment and Confidentiality Agreement, attached hereto as Exhibit A,
contemporaneously with the execution of this Agreement.
ARTICLE IV
TERMINATION
4.1 Disability. In the event of the permanent disability (as hereinafter
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defined) of Executive during the Employment Period, the Company shall have the
right, upon written notice to Executive, to terminate Executive's employment
hereunder, effective upon the 30/th/ calendar day following the giving of such
notice (or such later day as shall be specified in such notice). Upon the
effectiveness of such termination, (i) the Company shall have no further
obligations hereunder, except to pay and provide, subject to applicable
withholding, (A) all amounts of Base Salary and bonus accrued, but unpaid, at
the effective date of termination, and (B) all reasonable unreimbursed business-
related expenses, and (ii) Executive shall have no further obligations
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hereunder other than those provided for in Article III hereof. All amounts
payable to Executive pursuant to this Section 4.1 shall be payable within 30
days following the effectiveness of the termination of Executive's employment.
For purposes of this Agreement, "permanent disability" shall be defined as any
physical or mental disability or incapacity which renders Executive incapable in
any material respect of performing the services required of him in accordance
with his obligations under Article I for a period of 180 consecutive days, or
180 days in any 360 day period.
4.2 Death. In the event of the death of Executive during the Employment
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Period, this Agreement shall automatically terminate and the Company shall have
no further obligations hereunder, except to pay and provide to Executive's
beneficiary or other legal representative, subject to applicable withholding,
(i) all amounts of Base Salary and bonus accrued but unpaid, at the date of
death, and (ii) all reasonable unreimbursed business-related expenses. All
amounts payable to Executive pursuant to this Section 4.2 shall be payable
within 30 days following the date of death.
4.3 Termination Without Cause. In the event of the termination of
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Executive's employment by the Company without Cause (as defined below) during
the Employment Period or upon the Executive's voluntary termination of his
employment for Good Reason (as defined below) during the Employment Period, all
amounts of Base Salary and bonus accrued but unpaid on the date of termination
shall be paid by the Company within 30 days following the date of termination.
In addition, if such termination occurs prior to the first anniversary of the
Commencement Date, an amount equal to Executive's Base Salary on the date of
termination for a period of three months (the "Severance Period") shall be paid
by the Company to Executive in one lump sum. If such termination occurs after
the first anniversary and prior to the third anniversary of the Commencement
Date, the Severance Period shall be 6 months. If such termination occurs after
the third anniversary of the Commencement Date, the Severance Period shall be 12
months and the payment shall be paid in four substantially equal payments over
the 12-month period following Executive's termination.
4.4 Termination for Cause; Voluntary Termination. The Company shall only
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be obligated to pay the Base Salary and bonus accrued but unpaid on the date of
termination, and shall not be obligated to pay Executive any termination
benefits if the Employment Period is terminated for Cause or if Executive
voluntarily terminates his employment other than for Good Reason (as defined
below). For purposes of this Agreement, "Cause" shall be limited to:
(a) Willful failure by Executive to substantially perform his duties
hereunder, other than a failure resulting from his complete or partial
incapacity due to physical or mental illness or impairment;
(b) A material and willful violation of a federal or state law or
regulation applicable to the business of the Company or that adversely affects
the image of the Company;
(c) Commission of a willful act by Executive which constitutes gross
misconduct and is injurious to the Company; or
(d) A willful breach of a material provision of this Agreement.
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4.5 Constructive Termination. Notwithstanding anything in this Agreement
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to the contrary, for purposes of this Agreement, the Employment Period will be
deemed to have been terminated and Executive will be deemed to have Good Reason
for voluntary termination of the Employment Period ("Good Reason"), if there
should occur:
(a) A material adverse change in Executive's position causing it to
be of materially less stature or responsibility without Executive's written
consent, and such a materially adverse change shall in all events be deemed to
occur if Executive no longer serves as President and Chief Executive Officer
reporting to the Board of Directors, unless Executive consents in writing to
such change;
(b) A material reduction, without Executive's written consent, in his
level of base compensation (including base salary and fringe benefits) by more
than ten percent (10%);
(c) A relocation of Executive's principal place of employment by more
than 50 miles without Executive's consent.
4.6 Change in Control Benefits. Should there occur a Change in Control
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(as defined below), then the following provisions shall become applicable:
(a) Fifty percent (50%) of the portion of all of the Executive's
stock options which are unvested on the date of such Change in Control (the
"Unvested Options") shall immediately vest and become exercisable. The remaining
fifty percent (50%) of the Unvested Options shall continue to vest and become
exercisable in accordance with their terms, provided Executive continues to
provide services to the Company.
(b) During the period (if any) following a Change in Control that
Executive shall continue to remain employed, then the terms and provisions of
this Agreement shall continue in full force and effect.
For purposes of this Section 4.6, the term "Change of Control" shall
mean:
(y) The sale, lease, conveyance, liquidation or other
disposition of all or substantially all of the Company's
assets as an entirety or substantially as an entirety to any
person, entity or group of persons acting in concert other
than in the ordinary course of business; or
(y) Any transaction or series of related transactions (as a
result of a tender offer, merger, consolidation or
otherwise) that results in any Person (as defined in Section
13(h)(8)(E) under the Securities Exchange Act of 1934)
becoming the beneficial owner (as defined in Rule 13d-3
under the Securities Exchange Act of 1934), directly or
indirectly, of more than 50% of the aggregate voting power
of all classes of common equity of the Company, except if
such Person is (A) a subsidiary of the Company, (B) an
employee stock ownership plan for employees of the Company
or (C) a company formed to hold the Company's common equity
securities and
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whose shareholders constituted, at the time such company
became such holding company, substantially all the
shareholders of the Company.
In the event that the benefits provided to Executive pursuant to
Section 4.6 of this Agreement (i) constitute "parachute payments"
within the meaning of Section 280G of the Internal Revenue Code of
1986, as amended (the "Code") and (ii) but for this Section 4.6, such
severance and benefits would be subject to the excise tax imposed by
Section 4999 of the Code, then Executive's severance benefits under
this Section 4.6 shall be payable either:
(A) in full,
(B) as to such lesser amount which would result in no
portion of such severance and other benefits being
subject to excise tax under Section 4999 of the Code,
whichever of the foregoing amounts, taking into account
the applicable federal, state and local income taxes
and the excise tax imposed by Section 4999, results in
the receipt by Executive on an after-tax basis, of the
greatest amount of severance benefits under this
Agreement.
Unless the Company and Executive otherwise agree in writing, any
determination required under this Section 4.6 shall be made in writing by
independent public accountants agreed to by the Company and the Executive
(the "Accountants"), whose determination shall be conclusive and binding
upon Executive and the Company for all purposes. For purposes of making
the calculations required by this Section 4.6, the Accountants may make
reasonable assumptions and approximations concerning applicable taxes and
may rely on reasonable, good faith interpretations concerning the
application of Sections 280G and 4999 of the Code. The Company and
Executive shall furnish to the Accountants such information and documents
as the Accountants may reasonably request in order to make a determination
under this Section 4.6. The Company shall bear all costs the Accountants
may reasonably incur in connection with any calculations contemplated by
this Section 4.6.
ARTICLE V
GENERAL PROVISIONS
5.1 Dispute Resolution. The Company and Executive agree that any dispute
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regarding the interpretation or enforcement of this Agreement shall be decided
by confidential, final and binding arbitration conducted by Judicial Arbitration
and Mediation Services ("JAMS") under the then-existing JAMS rules, rather than
by litigation in court, trial by jury, administrative proceeding, or in any
other forum.
5.2 Cooperation with the Company After Termination of the Employment
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Period. Following termination of the Employment Period by Executive, Executive
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shall fully cooperate with the Company in all matters relating to the winding up
of his pending work on behalf of the
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Company and the orderly transfer of any such pending work to other employees of
the Company as may be designated by the Company.
5.3 Indemnification. In the event Executive is made, or threatened to be
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made, a party to any legal action or proceeding, whether civil or criminal, by
reason of the fact that Executive is or was a director or officer of the Company
or serves or served any other corporation fifty percent (50%) or more owned or
controlled by the Company in any capacity at the Company's request, Executive
shall be indemnified by the Company, and the Company shall pay Executive's
related expenses when and as incurred, all to the fullest extent permitted by
law.
5.4 Waiver. Neither party shall, by mere lapse of time, without giving
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notice or taking other action hereunder, be deemed to have waived any breach by
the other party of any of the provisions of this Agreement. Further, the waiver
by either party of a particular breach of this Agreement by the other shall
neither be construed as, nor constitute a, continuing waiver of such breach or
of other breaches by the same or any other provision of this Agreement.
5.5 Severability. If for any reason a court of competent jurisdiction or
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arbitrator finds any provision of this Agreement to be unenforceable, the
provision shall be deemed amended as necessary to conform to applicable laws of
regulations, or if it cannot be so amended without materially altering the
intention of the parties, the remainder of the Agreement shall continue in full
force and effect as if the offending provision were not contained herein.
5.6 Notices. All notices and other communications required or permitted
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to be given under this Agreement shall be in writing and shall be considered
effective upon personal service or upon transmission of a facsimile or the
deposit with Federal Express or in Express Mail and addressed to the Board at
its principal corporate records, or at any other address which he may specify in
any appropriate notice to the Company.
5.7 Counterparts. This Agreement may be executed in any number of
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counterparts, each of which shall be deemed an original and all of which taken
together constitutes one and the same instrument and in making proof hereof it
shall not be necessary to produce or account for more than one such counterpart.
5.8 Entire Agreement. The parties hereto acknowledge that each has read
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this Agreement, understands it, and agrees to be bound by its terms. The
parties further agree that this Agreement, the Employee Invention Assignment and
Confidentiality Agreement and the referenced stock option agreement shall
constitute the complete and exclusive statement of the agreement between the
parties and supersedes all proposals (oral or written), understandings,
representations, conditions, covenants, and all other communications between the
parties relating to the subject matter hereof.
5.9 Governing Law. This Agreement shall be governed by the law of the
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State of California.
5.10 Assignment and Successors. The Company shall have the right to assign
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its rights and obligations under this Agreement to an entity which acquires
substantially all of the assets of the Company. The rights and obligation of
the Company under this Agreement shall inure to the benefit and shall be binding
upon the successors and assigns of the Company.
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IN WITNESS WHEREOF, the parties have executed this Agreement on the date
first above written.
"Executive"
________________________________________
Xxxxx X. Xxxxxxx
"Company"
MARKETFIRST SOFTWARE, INC.
By:_____________________________________
Xxxxxx X. Xxxxx
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