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EXHIBIT 10.17
EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is made and entered into as of
April 17, 2000, by and among H.T.E., INC., a Florida corporation (hereinafter
called the "Company") and XXXXX X. XXXXXXX (hereinafter called the "Executive").
R E C I T A L S
The Executive and the Company have agreed that the Executive shall be
employed by the Company pursuant to the terms and conditions hereinafter set
forth.
AGREEMENT
NOW, THEREFORE, in consideration of the premises and mutual covenants
set forth herein, the parties agree as follows:
1. Employment.
1.1 Cancellation of Prior Employment Agreement and
Establishment of New Employment Agreement and Term. The Executive has been
employed by the Company, prior to the day hereof pursuant to certain agreements
and/or understandings (the "prior employment agreement"), the terms and
provisions of which are canceled effective with the date hereof; and the Company
hereby agrees to continue to employ the Executive and the Executive hereby
agrees to continue to serve the Company on the terms and conditions set forth
herein. Notwithstanding the above cancellation of Executive's prior employment
agreement, Executive's date of hire under this Agreement for all purposes,
including vacation accrual and other employee benefits, shall be his original
date of hire, April 1, 1991.
1.2 Duties of Executive. During the term of this
Agreement, the Executive shall serve as Vice President of Sales and Marketing of
the Company, and shall diligently perform all services as may be assigned to him
by the Board of Directors or the Chief Executive Officer of the Company and
consistent with his position and shall exercise such power and authority as may
from time to time be delegated to him by Company subject to the customary
supervision of the executive officers of Company. Initially, the Executive shall
report to Xxxxxx X. Xxxxxxx, III, President and CEO. The Executive shall devote
his full time and attention to the business and affairs of the Company, render
such services to the best of his ability, and use his best efforts to promote
the interests of the Company. The Executive shall not be prohibited from giving
attention to personal business matters and the like, including service on
charitable or public service boards, so long as such other matters do not
interfere with Executive's obligations under this Agreement.
2. Term.
2.1 Initial Term. The initial term of this Agreement, and
the employment of the Executive hereunder, shall commence on April 17, 2000 (the
"Commencement Date") and shall expire on December 31, 2000, unless sooner
terminated in accordance with the terms and conditions hereof (the "Initial
Term").
2.2 Renewal Terms. At the end of the Initial Term, this
Agreement shall automatically renew and continue until terminated by either
party hereto upon one hundred twenty (120) days prior written
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notice, subject to earlier termination of this Agreement as provided herein.
2.3 Expiration Date. The date on which the term of this
Agreement shall expire (including the date on which any renewal term shall
expire), is sometimes referred to in this Agreement as the Expiration Date.
3. Compensation.
3.1 Base Salary. The Executive shall receive an initial
base salary at the annual rate of One Hundred Thirty-five Thousand Dollars
($135,000) (the "Base Salary"), with such Base Salary payable in installments
consistent with the Company's normal payroll schedule, subject to applicable
withholding and other taxes. The Base Salary shall be reviewed, at least
annually, for merit increases and may, by action and in the discretion of the
Company's Board of Directors, be increased at any time or from time to time.
3.2 Bonuses. During the term of this Agreement beginning
April 1, 2000, the Executive shall be eligible to receive periodic bonuses (the
"Incentive Compensation") pursuant to the Vice President of Sales and Marketing
Incentive Compensation Plan (the "Incentive Compensation Plan"), a copy of which
plan for the remainder of year 2000 is attached hereto as Exhibit A. Each period
for which Incentive Compensation is payable under the Incentive Compensation
Plan is sometimes hereinafter referred to as a Bonus Period.
4. Expense Reimbursement and Other Benefits.
4.1 Reimbursement of Expenses. During the term of
Executive's employment hereunder, upon the submission of proper substantiation
by the Executive, and subject to such rules and guidelines as the Company may
from time to time adopt in writing, the Company shall reimburse the Executive
for all reasonable expenses actually paid or incurred by the Executive in the
course of and pursuant to the business of the Company. The Executive shall
account to the Company in writing for all expenses for which reimbursement is
sought and shall supply to the Company copies of all relevant invoices, receipts
or other evidence reasonably requested by the Company.
4.2 Compensation/Benefit Programs. During the term of
this Agreement, the Executive shall be entitled to participate in all medical,
dental, hospitalization, accidental death and dismemberment, disability, travel
and life insurance plans, and any and all other plans as are presently and
hereinafter offered by the Company to its executives, including stock purchase,
option, savings, retirement and deferred compensation plans.
4.3 Working Facilities. The Company shall furnish the
Executive with an office and such other facilities and services suitable to his
position and adequate for the performance of his duties hereunder.
4.4 Other Benefits. The Executive shall be entitled to
vacation time in accordance with the Company's policy for its executive officers
during the term of this Agreement, to be taken at such times as the Executive
and the Company shall mutually determine and provided that no vacation time
shall materially interfere with the duties required to be rendered by the
Executive hereunder. The Executive shall receive such additional benefits, if
any, as the Company shall from time to time determine.
4.5 Stock Options. Effective as of April 20, 2000, the
Company and Executive shall enter into a stock option agreement under which the
Executive shall be granted options (the "Stock Option") to purchase seventy
thousand (70,000) shares of common stock (the "Common Stock") of the Company at
a
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price per share equal to the NASDAQ closing price for such date. Forty thousand
(40,000) shares of the Stock Option shall be subject to a vesting schedule of
one-fifth (1/5th) per year. Fifteen thousand (15,000) shares of the Stock Option
shall vest upon the closing NASDAQ share price of the Common Stock being at ten
dollars ($10) or more for at least ten consecutive trading days. Up to fifteen
thousand (15,000) shares of the Stock Option shall vest upon the Company
achieving aggregate new contract bookings (defined as "total contracted value of
new sales to customers excluding hardware, maintenance, 3rd party license fees
and facilities management services") for the three calendar quarters ending June
30, September 30 and December 31, 2000, as follows: 5,000 shares upon achieving
new contract bookings of at least $16,000,000; 5,000 shares upon achieving new
contract bookings of at least $20,000,000 and 5,000 shares upon achieving new
contract bookings of at least $24,000,000. The Stock Option shall be subject to
all terms and conditions of the HTE, Inc. 1997 Employee Incentive Compensation
Plan as amended, and any successor plan thereto (the "Executive Incentive
Compensation Plan") and all rules and regulation of the Securities and Exchange
Commission applicable to stock option plans then in effect. The Executive shall
be eligible for the grant of additional stock options from time to time under
the Executive Incentive Compensation Plan. The number of such additional stock
options, and terms and conditions of such stock options shall be determined by
the Committee appointed pursuant to the Executive Incentive Compensation Plan,
or by the Board of Directors of the Company, in its discretion and pursuant to
the Executive Incentive Compensation Plan.
5. Termination.
5.1 Termination for Cause. The Company shall at all times
have the right, upon written notice to the Executive, to terminate the
Executive's employment hereunder, for cause. For purposes of this Agreement, the
term "Cause" shall mean: (a) an action or omission of the Executive which
constitutes an intentional, willful and material breach of this Agreement which
is not cured within thirty (30) days after receipt by the Executive of written
notice of same, (b) fraud, embezzlement, or misappropriation of funds in
connection with his services hereunder, (c) conviction of any crime which
involves dishonesty or a breach of trust, or (d) material failure to
satisfactorily perform or otherwise meet the Executive's duties hereunder, as
reasonably determined by the Company's Board of Directors which is not cured
within thirty (30) days after receipt by the Executive of written notice of the
same. Any termination for cause shall be made in writing to the Executive, which
notice shall set forth in detail all acts or omissions upon which the Company is
relying for such termination. Upon any termination pursuant to this Section 5.1,
the Company shall pay to the Executive his Base Salary to the date of
termination. The Company shall have no further liability hereunder other than
for: (i) reimbursement for reasonable business expenses incurred prior to the
date of termination, subject, however, to the provisions of Section 4.1, and
(ii) payment of compensation for unused vacation days that have accumulated in
accordance with the Company's written vacation policy then in effect.
5.2 Disability. The Company shall at all times have the
right, upon written notice to the Executive, to terminate the Executive's
employment hereunder, if the Executive shall become entitled to benefits under
the Company's Long Term Disability Plan as then in effect. The Company shall
have sole discretion based upon competent medical advice to determine whether
the Executive continues to be disabled under the Company's Long Term Disability
Plan. Upon any termination pursuant to this Section 5.2, the Company shall: (a)
pay to the Executive any unpaid Base Salary through the effective date of
termination specified in such notice, (b) pay to the Executive his accrued and
declared but unpaid Incentive Compensation, if any, for any Bonus Period ending
on or before the date of termination of the Executive's employment with the
Company, and (c) pay to the Executive (within forty-five (45) days after the end
of the Bonus Period in which such termination occurs) a pro rata portion (based
upon the period ending on the date of termination of the Executive's employment
hereunder) of the Incentive Compensation, if any, for the Bonus Period in which
such termination occurs, as calculated pursuant to the Incentive Compensation
Plan; provided that the goals under the Incentive Compensation Plan for each
period used in the calculation of the Executive's Incentive Compensation, shall
be based on: (i) the portion of the Bonus Period through the end of
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the Bonus Period in which such termination occurs and (ii) unaudited financial
information prepared in accordance with generally accepted accounting
principles, applied consistently with prior periods. The Company shall have no
further liability hereunder other than for: (x) reimbursement for reasonable
business expenses incurred prior to the date of termination, subject, however to
the provisions of Section 4.1, and (y) payment of compensation for unused
vacation days that have accumulated in accordance with the Company's written
vacation policy then in effect.
5.3 Death. In the event of the death of the Executive
during the term of his employment hereunder, the Company shall: (a) pay to the
estate of the deceased Executive any unpaid Base Salary through the Executive's
date of death, (b) pay to the estate of the deceased Executive his accrued and
declared but unpaid Incentive Compensation, if any, for any Bonus Period ending
on or before the Executive's date of death, (c) pay to the estate of the
deceased Executive (within forty-five (45) days after the end of the Bonus
Period in which his death occurs) a pro rata portion (based upon the period
ending on the date of death) of the Incentive Compensation, if any, for the
Bonus Period in which his death occurs, as calculated pursuant to the terms of
the Incentive Compensation Plan; provided that, the goals under the Incentive
Compensation Plan for each period used in the calculation of the Executive's
Incentive Compensation shall be based on: (i) the portion of the Bonus Period
through the end of the Bonus Period in which the Executive's death occurs, and
(ii) unaudited financial information prepared in accordance with generally
accepted accounting principles, applied consistently with prior periods. The
Company shall have no further liability hereunder other than for: (x)
reimbursement for reasonable business expenses incurred prior to the date of the
Executive's death, subject, however to the provisions of Section 4.1, and (y)
payment of compensation for unused vacation days that have accumulated in
accordance with the Company's written vacation policy then in effect.
5.4 Termination Not for Cause. In the case of termination
of Executive's employment by Company, without Cause, the Company shall: (a) pay
to the Executive any unpaid Base Salary through the effective date of
termination specified in such notice, together with additional Base Salary for a
period equal to the longer of (i) the remainder of the Initial Term, if the
effective date of such termination is prior to the end of the Initial Term, or
(ii) one hundred eighty (180) days; (b) pay to the Executive his accrued and
declared but unpaid Incentive Compensation, if any, for any Bonus Period ending
on or before the date of termination of the Executive's employment with the
Company; and (c) pay to the Executive (within forty-five (45) days after the end
of the Bonus Period in which such termination occurs) a pro rata portion (based
upon the period ending on the date of termination of the Executive's employment
hereunder) of the Incentive Compensation, if any, for the Bonus Period in which
such termination occurs, as calculated pursuant to the Incentive Compensation
Plan; provided that the goals under the Incentive Compensation Plan for each
period used in the calculation of the Executive's Incentive Compensation, shall
be based on: (i) the portion of the Bonus Period through the end of the Bonus
Period in which such termination occurs and (ii) unaudited financial information
prepared in accordance with generally accepted accounting principles, applied
consistently with prior periods. The Company shall have no further liability
hereunder other than for: (x) reimbursement for reasonable business expenses
incurred prior to the date of termination, subject, however to the provisions of
Section 4.1, and (y) payment of compensation for unused vacation days that have
accumulated in accordance with the Company's written vacation policy then in
effect.
6. Restrictive Covenants.
6.1 Non-competition. At all times while the Executive is
employed by the Company and (i) for a two (2) year period after the termination
of the Executive's employment with the Company for Cause or if Executive
voluntarily resigns, or (ii) for a one (1) year period after the termination of
the Executive's employment with the Company any of other reason, the Executive
shall not, directly or indirectly, act alone or as a partner, joint venturer,
officer, director, member, employee, consultant, agent, independent contractor
or shareholder of, or lender to, any company or business (a "Competitor") whose
products or services compete
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with (i) the business of Company (for this purpose, any business that engages or
intends to engage in the development, manufacturing, marketing, licensing, or
sale of software applications or products that have been developed and/or
marketed, or are in the process of being developed and/or marketed, by Company
(the "Computer Products") at any time during the time the Executive was or is
employed by the Company shall be deemed to be in competition with the Company
and a Competitor) (for purposes of this Section 6.1, collectively the
"Business") or (ii) the Computer Products or any upgrades, enhancements, or
other releases, modifications or customizations thereof, or otherwise which
enterprise is the same as or similar to the Business; provided, however, that,
the beneficial ownership of less than five percent (5%) of the shares of stock
of any corporation having a class of equity securities actively traded on a
national securities exchange or over-the-counter market shall not be deemed, in
and of itself, to violate the prohibitions of this Section.
6.2 Nondisclosure. The Executive shall not at any time
divulge, communicate, use to the detriment of the Company or for the benefit of
any other person or persons, or misuse in any way, any Confidential Information
(as hereinafter defined) pertaining to the business of the Company. Any
Confidential Information or data now or hereafter acquired by the Executive with
respect to the business of the Company (which shall include, but not be limited
to, information concerning the Company's financial condition, prospects,
technology, customers, suppliers, sources of leads and methods of doing
business) shall be deemed a valuable, special and unique asset of the Company
that is received by the Executive in confidence and as a fiduciary, and
Executive shall remain a fiduciary to the Company with respect to all of such
information. For purposes of this Agreement, "Confidential Information" means
information disclosed to the Executive or known by the Executive as a
consequence of or through his employment by the Company (including information
conceived, originated, discovered or developed by the Executive) prior to or
after the date hereof, and not generally known, about the Company or its
business. Notwithstanding the foregoing, nothing herein shall be deemed to
restrict the Executive from disclosing Confidential Information to the extent
required by law.
6.3 Nonsolicitation of Employees and Clients. At all
times while the Executive is employed by the Company and for a two (2) year
period after the termination of the Executive's employment with the Company for
any reason, the Executive shall not, directly or indirectly, for himself or for
any other person, firm, corporation, partnership, association or other entity:
(a) employ or attempt to employ or enter into, or knowingly permit any company
or business directly or indirectly controlled by such Executive, to employ or
attempt to employ or enter into, any contractual arrangement with any then
current or former management personnel, computer programmer or similarly skilled
employee of the Company, unless such employee or former employee has not been
employed by the Company for a period in excess of six (6) months, and/or (b)
call on or solicit any of the actual or targeted prospective clients of the
Company on behalf of any Competitor, nor shall the Executive make known the
names and addresses of such clients or any information relating in any manner to
the Company's trade or business relationships with such clients, other than in
connection with the performance of Executive's duties under this Agreement.
6.4 Ownership of Developments. All copyrights, patents,
trade secrets, or other intellectual property rights associated with any ideas,
concepts, techniques, inventions, processes, or works of authorship developed or
created by Executive during the course of performing work for the Company or its
clients (collectively, the "Work Product") shall belong exclusively to the
Company and shall, to the extent possible, be considered a work made by the
Executive for hire for the Company within the meaning of Title 17 of the United
States Code. To the extent the Work Product may not be considered work made by
the Executive for hire for the Company, the Executive agrees to assign, and
automatically assign at the time of creation of the Work Product, without any
requirement of further consideration, any right, title, or interest the
Executive may have in such Work Product. Upon the request of the Company, the
Executive shall take such further actions, including execution and delivery of
instruments of conveyance, as may be appropriate to give full and proper effect
to such assignment.
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6.5 Books and Records. All books, records, and accounts
relating in any manner to the customers or clients of the Company, whether
prepared by the Executive or otherwise coming into the Executive's possession,
shall be the exclusive property of the Company and shall be returned immediately
to the Company on termination of the Executive's employment hereunder or on the
Company's request at any time.
6.6 Acknowledgment by Executive. The Executive
acknowledges and confirms that the length of the term of the provisions of this
Section 6 and the geographical restrictions contained in Section 6.1 are fair
and reasonable and not the result of overreaching, duress or coercion of any
kind. The Executive further acknowledges and confirms that his full, uninhibited
and faithful observance of each of the covenants contained in this Section 6
will not cause him any undue hardship, financial or otherwise. The Executive
acknowledges and confirms that his special knowledge of the business of the
Company is such as would cause the Company serious injury or loss if he were to
use such ability and knowledge to the benefit of a competitor or were to compete
with the Company in violation of the terms of this Section 6.
6.7 Reformation by Court. In the event that a court of
competent jurisdiction shall determine that any provision of this Section 6 is
invalid or more restrictive than permitted under the governing law of such
jurisdiction, then only as to enforcement of this Section 6 within the
jurisdiction of such court, such provision shall be interpreted and enforced as
if it provided for the maximum restriction permitted under such governing law.
6.8 Extension of Time. If the Executive shall be in
violation of any provision of this Section 6, then each time limitation set
forth in this Section 6 shall be extended for a period of time equal to the
period of time during which such violation or violations occur. If the Company
seeks injunctive relief from such violation in any court, then the covenants set
forth in this Section 6 shall be extended for a period of time equal to the
pendency of such proceeding including all appeals by the Executive.
6.9 Survival. The provisions of this Section 6 shall
survive the termination of this Agreement, as applicable.
7. Injunction. It is recognized and hereby acknowledged by the
parties hereto that a breach by the Executive of any of the covenants contained
in Section 6 of this Agreement will cause irreparable harm and damage to the
Company, the monetary amount of which may be virtually impossible to ascertain.
As a result, the Executive recognizes and hereby acknowledges that the Company
shall be entitled to an injunction from any court of competent jurisdiction
enjoining and restraining any violation of any or all of the covenants contained
in Section 6 of this Agreement by the Executive or any of his affiliates,
associates, partners or agents, either directly or indirectly, and that such
right to injunction shall be cumulative and in addition to whatever other
remedies the Company may possess.
8. Successors and Assignment. This Agreement shall be binding
upon and inure to the benefit of the Executive and his/her heirs and personal
representatives and the Company and its successors, assigns and legal
representatives. This Agreement is for the personal services of the Executive.
The benefits hereunder are personal to the Executive and are not assignable or
transferable by the Executive. This Agreement shall not be assigned by the
Company to any entity or person without the prior written consent of the
Executive, provided that it may be assigned by the Company without the prior
written consent of the Executive to an entity or person which acquires all or
substantially all of the assets of the Company by purchase, merger or
consolidation. In the event of any permitted assignment, all references to the
Company in this Agreement shall be deemed to mean such assignee, but the Company
shall not be released from its obligations under this Agreement by virtue of the
assignment of this Agreement.
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9. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Florida.
10. Entire Agreement. This Agreement constitutes the entire
agreement between the parties hereto with respect to the subject matter hereof
and, upon its effectiveness, shall supersede all prior agreements,
understandings and arrangements, both oral and written, between the Executive
and the Company with respect to such subject matter. This Agreement may not be
modified in any way unless by a written instrument signed by both the Company
and the Executive.
11. Notices. All notices required or permitted to be given
hereunder shall be in writing and shall be personally delivered by courier, sent
by registered or certified mail, return receipt requested or sent by confirmed
facsimile transmission addressed as set forth herein. Notices personally
delivered, sent by facsimile or sent by overnight courier shall be deemed given
on the date of delivery and notices mailed in accordance with the foregoing
shall be deemed given upon the earlier of receipt by the addressee, as evidenced
by the return receipt thereof, or three (3) days after deposit in the U.S. Mail.
Notice shall be sent: (a) if to the Company, addressed to 0000 Xxxxxxxx Xxxxxx
Xxxxx, Xxxx Xxxx, Xxxxxxx, 00000, Attention: President, and (b) if to the
Executive, to his address as reflected on the payroll records of the Company, or
to such other address as either party hereto may from time to time give notice
of to the other.
12. Benefits; Binding Effect. This Agreement shall be for the
benefit of and binding upon the parties hereto and their respective heirs,
personal representatives, legal representatives, successors and, where
applicable, assigns, including, without limitation, any successor to the
Company, whether by merger, consolidation, sale of stock, sale of assets or
otherwise.
13. Severability. The invalidity of any one or more of the words,
phrases, sentences, clauses or sections contained in this Agreement shall not
affect the enforceability of the remaining portions of this Agreement or any
part thereof, all of which are inserted conditionally on their being valid in
law, and, in the event that any one or more of the words, phrases, sentences,
clauses or sections contained in this Agreement shall be declared invalid, this
Agreement shall be construed as if such invalid word or words, phrase or
phrases, sentence or sentences, clause or clauses, or section or sections had
not been inserted. If such invalidity is caused by length of time or size of
area, or both, the otherwise invalid provision will be considered to be reduced
to a period or area which would cure such invalidity.
14. Waivers. The waiver by either party hereto of a breach or
violation of any term or provision of this Agreement shall not operate nor be
construed as a waiver of any subsequent breach or violation.
15. Damages. Nothing contained herein shall be construed to
prevent the Company or the Executive from seeking and recovering from the other
damages sustained by either or both of them as a result of its or his breach of
any term or provision of this Agreement. In the event that either party hereto
brings suit for the collection of any damages resulting from, or the injunction
of any action constituting, a breach of any of the terms or provisions of this
Agreement, then the party found to be at fault shall pay all reasonable court
costs and attorneys' fees of the other.
16. Section Headings. The section headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.
17. No Third Party Beneficiary. Nothing expressed or implied in
this Agreement is intended, or shall be construed, to confer upon or give any
person other than the Company, the parties hereto and their respective heirs,
personal representatives, legal representatives, successors and assigns, any
rights or
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remedies under or by reason of this Agreement.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date first above written.
COMPANY: EXECUTIVE:
HTE, INC.
By: /s/ Xxxxxx X. Xxxxxxx, III /s/ Xxxxx X. Xxxxxxx
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Xxxxxx X. Xxxxxxx, III Xxxxx X. Xxxxxxx
President and CEO
