1
EXHIBIT 10.2
FIFTH AMENDMENT TO EMPLOYMENT AGREEMENT
THIS FIFTH AMENDMENT, made as of the 1st day of March, 1999, by and
between MECHANICAL DYNAMICS, INC., a Michigan corporation (the "Company"),
having offices located at 0000 Xxxxxxxxxxxx Xxxx., Xxx Xxxxx, Xxxxxxxx 00000,
and XXXXXX X. XXXX, of Brighton, Michigan ("Employee"), for the purpose of
amending that certain Employment Agreement between the Company and Employee
dated as of April 1, 1994, and amended by agreements dated as of March 1, 1995,
as of March 1, 1996, as of March 1, 1997, and as of March 1, 1998 (collectively,
the "Employment Agreement").
WITNESSETH:
WHEREAS, the Company and Employee desire to extend the Employment
Agreement and to confirm modifications to the terms of said Agreement herein.
NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants contained herein and in the Employment Agreement, the parties hereto
agree as follows:
A. Section 2 of the Employment Agreement is hereby amended to extend
the term of said Agreement through March 31, 2001.
B. Section 6 of the Employment Agreement is hereby deleted in its
entirety and there is substituted therefor a new Section 6 as follows:
"6. CHANGE OF DUTIES; RELOCATION. In the event that during the
term of this Agreement, the Company's Board of Directors chooses to
change the Employee's title as President and Chief Operating Officer of
the Company and/or his duties hereunder, or directs Employee to
relocate away from Ann Arbor, Michigan, then Employee shall be entitled
to resign and to receive as severance compensation, his entire base
salary, bonus (calculated as provided in Section 7.4 hereof), vacation
and fringe benefits in the amounts and payable as provided herein for a
period equal to the then remaining term of this Agreement. Further, if
the remaining term of this Agreement is less than one (1) year from the
date of Employee's resignation, then the term of this Agreement shall
be automatically extended through a date one (1) year from the date of
such resignation."
C. Section 7.4 of the Employment Agreement is hereby deleted in its
entirety and there is substituted therefor a new Section 7.4 as follows:
"7.4 Change of Control. In the event of a change in control
(as hereinafter defined) of the Company, then the term of this
Agreement shall be automatically extended through a date two (2) years
from the effective date of such change in
- 1 -
2
control. Further, if, after the effective date of the change in
control, Employee resigns for any reason or is terminated with or
without "Cause", then, in any such event, the Company shall (a)
continue to pay Employee's base salary on a monthly basis and provide
all fringe benefits, in each case as in effect at the date of
Employee's resignation or termination, for a period (the "Contract
Period") equal to the greater of the remaining term of this Agreement
or one (1) year from the date of resignation or termination and (b) pay
Employee a bonus for the Contract Period equal to the highest bonus
paid to Employee during the last three (3) calendar years preceding his
resignation or termination multiplied by the number of months from the
beginning of the calendar year in which resignation or termination
occurs to the end of the Contract Period divided by twelve (12), said
bonus to be paid in equal monthly installments during the Contract
Period. Such payment and benefits shall be in lieu of all other
payments and benefits to which Employee might otherwise be entitled
under the Company's employee policies and procedures and/or under this
Agreement. For purposes of this Section 7.4, the term "change of
control" shall mean the sale of fifty percent (50%) or more of (i) the
Company's outstanding capital stock or (ii) the assets of the Company."
D. Except as expressly modified herein, the Employment Agreement
shall remain in full force and effect in accordance with its terms.
IN WITNESS WHEREOF, the parties hereto have duly executed this Fifth
Amendment as of the day and year first above written.
WITNESS: COMPANY
MECHANICAL DYNAMICS, INC.
/s/ Xxxxx X. Xxxxx By: /s/ Xxxxxxx X. Xxxxxxxxxx
_________________________ _________________________________
Xxxxxxx X. Xxxxxxxxxx, CEO
EMPLOYEE
/s/ Xxxxx X. Xxxxx /s/ Xxxxxx X. Xxxx
_________________________ ____________________________________
Xxxxxx X. Xxxx
- 2 -
