EXHIBIT 10.32
RETENTION AGREEMENT
This Retention Agreement (the "Agreement") is made and entered into this 8th day
of November, 2002 (the "Effective Date") by and between Novadigm, Inc., a
Delaware corporation with offices at One International Blvd., Mahwah, New Jersey
(the "Company"), and Xxxxxx X. Xxxxxxxx ("Employee").
This Agreement will memorialize the understanding regarding Employee's continued
employment with Company. In order to induce Employee to remain an employee of
the Company, the parties agree as follows:
1. Company will pay Employee the following consideration in the aggregate
amount of $450,000 (the "Retention Consideration"), payable in
installments as follows:
- a first installment of $250,000 payable on the date hereof;
- a second installment of $100,000 payable on January 1, 2003,
provided that Employee has been continuously employed by the Company
on a full-time basis through such date; and
- a third installment of $100,000 payable on April 1, 2003, provided
that Employee has been continuously employed by the Company on a
full-time basis through such date.
2. To retain the full Retention Consideration, the Employee must be employed
by Company through to and including a date which is three years (36
months) from the Effective Date (the "Termination Date"), except as
hereinafter provided.
3. (a) In the event that, prior to October 1, 2005, Employee voluntarily
terminates Employee's employment for any reason or the Company terminates
Employee's employment for Reasonable Cause (as defined below), (a)
Employee will not be entitled to any part of the Retention Consideration,
and (b) Employee shall promptly repay to the Company the aggregate amount
of all
installments of the Retention Consideration paid to Employee hereunder
prior to the Termination Date (without interest thereon through the
Termination Date). "Reasonable Cause," as used herein, shall mean (i) any
act of personal dishonesty taken by the Employee in connection with
Employee's responsibilities as an employee and intended to result in
personal enrichment of the Employee, (ii) Employee's conviction of, or
plea of nolo contendere to, a felony, (iii) a willful act by the Employee
which constitutes gross misconduct and which is injurious to the Company,
or (iv) following delivery to the Employee of a written demand for
performance from the Company which describes the basis for the Company's
belief that the Employee has not substantially performed Employee's
duties, continued violations by the Employee of the Employee's obligations
to the Company.
(b) If the Employee's employment terminates as a result of Involuntary or
Constructive Termination other than for Reasonable Cause, the Employee
shall be entitled to retain the portion of the Retention Consideration
already received and shall receive the balance of the Retention
Consideration not yet paid to Employee within thirty (30) days of the
effective date of Employee's termination. "Involuntary or Constructive
Termination" shall mean (i) without the Employee's express written
consent, the assignment to the Employee of any duties or the significant
reduction of the Employee's duties, either of which is inconsistent with
the Employee's position with the Company and responsibilities in effect
immediately prior to such assignment, or the removal of the Employee from
such position and responsibilities; (ii) without the Employee's express
written consent, a substantial reduction, without good business reasons,
of the facilities and perquisites available to the Employee immediately
prior to such reduction; (iii) a reduction by the Company in the Base
Compensation of the Employee as in effect immediately prior to such
reduction; (iv) a material reduction by the Company in the kind or level
of employee benefits to which the
Employee is entitled immediately prior to such reduction with the result
that the Employee's overall benefits package is significantly reduced; (v)
without the Employee's express written consent, any relocation of the
Employee's job or office more than 40 miles from the Employee's then
current job or office; (vi) any purported termination of the Employee by
the Company which is not effected for the Disability or for Reasonable
Cause, or any purported termination for which the grounds relied upon are
not valid; or (vii) the failure of the Company to obtain the assumption of
this Agreement by any successors contemplated in Section 7 below.
4. If Employee fails to repay to the Company any amounts owed by Employee
pursuant to this Agreement above within twenty (20) business days of the
Termination Date, Employee shall, without notice or demand, (a) pay to the
Company interest on such amounts at a rate of 1.82% per annum, compounded
annually, from and after the Termination Date through the date of payment
of such amounts to the Company, and (b) pay all costs of collection and
enforcement incurred by the Company in connection therewith. Employee
hereby authorizes the Company to withhold from Employee, and to offset
against the amount repayable by Employee to Company, any salary, bonus,
vacation pay, commissions or any other compensation earned by Employee but
unpaid.
5. The payments pursuant to Paragraph 1 above shall be subject to customary
withholding taxes and such other employment taxes as are required under
federal law or the law of any state or other governmental body to be
collected with respect to compensation paid by a corporation to an
employee.
6. Notwithstanding anything to the contrary contained herein, Employee's
at-will employment with the Company will continue under the same terms and
conditions as are currently in place.
7. This Agreement contains the entire agreement between the Company and
Employee concerning the Retention Consideration and shall be binding upon,
and inure to the benefit of, the successors and permitted assigns of the
parties hereto. Neither party shall assign or transfer this agreement
without the prior written consent of the other party. No modification of
this letter agreement or waiver of the terms and conditions hereof will be
binding upon either party, unless approved in writing by both of the
parties. No delay of a party in exercising any right or remedy, nor any
other course of conduct, shall operate as a waiver of such rights or
remedies. This agreement shall be governed by the laws of the State of New
Jersey, without regard to its conflicts of laws principles. This Agreement
may be executed in two counterparts, each of which shall be deemed an
original and both of which shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the day,
month and year first written above.
NOVADIGM, INC.
By: /s/ Xxxxxx Xxxxxxxx
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Xxxxxx Xxxxxxxx
Vice President--Human Resources
/s/ Xxxxxx X. Xxxxxxxx
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Xxxxxx X. Xxxxxxxx
