EXHIBIT 10.5
BREAKAWAY SOLUTIONS, INC.
November 13, 1998
Xx. Xxxxxx Xxxxxx
00 Xxxxxx Xxxx
Xxxxxxxxx, Xxxxxxxxxxxxx 00000
Dear Xxxxxx:
BreakAway Solutions, Inc. (the "Company") is pleased to offer you the
positions of President and Chief Executive Officer of the Company (collectively,
the "Position") subject to the terms and conditions set forth in this letter
agreement ("Agreement"). In consideration of the mutual agreements set forth
below, you and the Company agree to the following:
1. EFFECTIVE DATE; TERM; EFFECT OF TERMINATION OF THIS AGREEMENT.
(a) EFFECTIVE DATE. This Agreement shall be effective upon the
Company's receipt of a copy of this Agreement originally executed by you (such
date being referred to as the "Effective Date") until November 30, 2000 unless
sooner terminated by you for any reason or by the Company for "cause" as defined
in Section 5. In connection with your execution of this Agreement you agree that
upon request of the Company you shall provide proof of your legal right to work
in the United States as required by the U.S. Immigration and Naturalization
Service. If you are not a U.S. citizen or U.S. permanent resident, you will be
required either to sign an assurance regarding obligations not to export
technical data or software to certain countries, or comply with the requirements
of subsection 6(a) below to the extent applicable to you.
(b) EFFECT OF TERMINATION OF THIS AGREEMENT. Termination of your
employment with the Company shall terminate this Agreement. Following
termination of this Agreement, this Agreement shall become null and void and no
party hereto (or any of their respective directors, officers or employees) shall
have any liability or further obligation to any other party hereto under this
Agreement, except as provided in Sections 3, 4, 5 or 6 of this Agreement, or as
provided in the Option Agreements referenced in Section 3. Nothing contained in
this Section 1 shall relieve any party from liability for any breach of this
Agreement occurring prior to any termination.
2. POSITION, DUTIES AND DURATION OF ASSIGNMENT. You will serve in the
Position with such duties and responsibilities that exist as of the Effective
Date, and/or as
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may later be reasonably assigned by Xxxxx Xxxxxxxxx and Xxxxxxxxxxx Xxxxxxxxx as
Co-Chairmen of the Board of Directors of the Company (or the then current
Co-Chairmen or Chairman of the Board of Directors of the Company), and as are
commensurate with the duties and responsibilities of Chief Executive Officers of
companies that are of comparable size and in comparable industries to the
Company. You will report to the Co-Chairmen. You will devote all of your
business time, skill, attention and best efforts to the Company's business and
to discharge and fulfill the responsibilities assigned to you by the Company
during your employment. You shall not render services to any other person or
entity without the prior written consent of the Company, and you shall not
engage in any activity which conflicts or interferes with the performance of the
duties and responsibilities of the Position.
3. COMPENSATION AND BENEFITS.
(a) SALARY. During your employment and commencing with your first day
of work for the Company (which we agree shall be on or before November 30,
1998), you will receive a base salary of $20,833.33 per month paid in accordance
with the Company's normal payroll practice. The Company will make such
deductions, withholdings and other payments from sums payable pursuant to this
Agreement which are required by law for taxes and other charges, or which you
request pursuant to payroll deductions chosen by you. In the event of your
death, the Company will make all salary payments which are accrued and not yet
paid as of the date of your death to your legal representative. All dollar
amounts stated in this and all other Sections of this Agreement refer to United
States currency.
(b) BONUS. At the end of the first year of your employment, you will
be eligible to receive a bonus of up to $100,000 based on performance milestones
established by the Co-Chairmen of the Company's Board of Directors and the
Company's Compensation Committee as and when such committee is established. The
Company is currently projecting to generate during the 1999 calendar year at
least $20,000,000 in gross revenues with a 10% pre-tax net income (which is an
increase of 100% over the prior year). In order for you to receive any portion
of the bonus, the Company will have to achieve at least 50% of the increase in
projected revenue and income goals (as determined by the Co-Chairmen or the
Compensation Committee and you). After your initial twelve months of employment
annual bonuses and reasonable target milestones will be established by the
Co-Chairmen and the Compensation Committee and you.
(c) STOCK OPTIONS. You will be granted the following incentive stock
options under the Company's 1998 Stock Option Plan (the "Stock Option Plan")
pursuant to one or more incentive stock option agreements substantially in the
form attached hereto as Exhibit A with such changes as you and the Company
mutually agree upon in accordance with Section 6(m) below (provided, however,
that to the extent any provision of such exhibit is inconsistent with an express
provision
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contained in this Agreement, this Agreement shall prevail and the form of option
agreement shall be appropriately revised). Notwithstanding the foregoing, if
applicable tax laws or regulations limit the number of options which may be
granted as incentive stock options, then the balance of such options shall be
granted as "non-qualified stock options" and the Company shall issue to you one
or more separate non-qualified stock option agreements substantially in the form
attached hereto as Exhibit B with respect to such options, with such changes as
you and the Company mutually agree upon in accordance with Section 6(m) below
(provided, however, that to the extent any provision of such exhibit is
inconsistent with a express provision contained in this Agreement, this
Agreement shall prevail and the form of option agreement shall be appropriately
revised).
(i) Upon and subject to the closing of an equity financing in
which at least $5,000,000 is invested in the Company or otherwise applied to the
purchase of shares of the Company's capital stock, and the pre-money valuation
of the Company in connection with such financing is at least $20,000,000, and
provided that (x) such financing closes on or before 2/28/99; (y) in connection
with such financing Xxxxx Xxxxxxxxx is offered the opportunity to sell shares of
his capital stock in the Company, based on the above-referenced pre-money
valuation, equal to a minimum of fifty percent (50%) of the amount of such
financing, and (z) such financing is subject to the removal of any personal
guarantees of Xxxxx Xxxxxxxxx or any other individual guarantors of Company
indebtedness (a financing in accordance with such terms shall be referred to as
the "Financing"), you will be granted a fully-vested option to purchase 254,875
shares of the Company's common stock, $.001 par value per share ("Common
Stock")(which number of shares is equal to 4% of the outstanding shares of stock
on the date of this Agreement) at an exercise price equal to $4.25.
(ii) Promptly following your execution of this Agreement, but in
no event later than 12/2/98, you will be granted an option to purchase 382,312
shares of the Company's Common Stock (as appropriately adjusted to reflect any
stock splits, stock dividends or other similar events which may occur after the
date hereof and prior to the date of grant) (which number of shares is equal to
6% of the outstanding shares of stock on the date of this Agreement), at an
exercise price equal to $4.25. The vesting of such option shall be as follows:
(1) 95,578 shares will vest on the first anniversary of
your initial employment date, with the balance vesting in equal monthly
installments over a period of three years after such first anniversary date; and
(2) all unvested shares shall immediately become vested
in full upon the occurrence of a Triggering Event (as defined below).
"Triggering Event" means immediately prior to the
occurrence of any of the following events: (a) a public offering by the Company
of shares of its
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Common Stock, (b) a sale of all or substantially all of the Company's assets or
all or substantially all of the shares of its capital stock, (c) a consolidation
or merger of the Company in which a majority of outstanding shares of the
Company's capital stock are exchanged for securities, cash or other property of
any other corporation or business entity, (d) a consolidation or merger
involving the Company as a result of which the stockholders of the Company
immediately prior to such event do not own, immediately following the occurrence
of such event, at least a majority of the common stock and voting power of the
entity resulting from such consolidation or surviving such merger or (e) the
liquidation or dissolution of the Company. In addition, if the Company or
stockholders of the Company enter into an agreement with respect to an event
described in (b) through (e) of the preceding sentence, then upon the
consummation of such event a Triggering Event shall be deemed to have occurred
upon the date of such agreement and, regardless of whether the option remains
outstanding on the date of consummation of the Triggering Event, you will be
entitled to exercise the option to the extent you would have been eligible to do
so if the Triggering Event was deemed to have occurred on the date the agreement
was entered into (and in any event, for a period of at least 30 days after the
consummation of such event).
(iii) Promptly following your execution of this Agreement, but in
on event later than 12/2/98, you will be granted an option to purchase 382,313
shares of the Company's Common Stock (as appropriately adjusted to reflect any
stock splits, stock dividends or other similar events which may occur after the
date hereof and prior to the date of grant) (which number of shares is equal to
6% of the outstanding shares of stock on the date of this Agreement), at an
exercise price equal to $4.25. The vesting of such option shall be as follows:
(1) 95,578 shares shall become vested upon the Company
obtaining a Valuation (as defined below) of $100,000,000;
(2) an additional 95,579 shares shall become vested upon
the Company obtaining a Valuation of $150,000,000;
(3) an additional 95,578 shares shall become vested upon
the Company obtaining a Valuation of $200,000,000;
(4) an additional 95,579 shares shall become vested upon
the Company obtaining a Valuation of $250,000,000 (the Valuation amounts listed
in subclauses (1) through (4) are each referred to as a "Target Amount");
(5) all unvested shares shall become vested on the
seventh anniversary of the date of grant;
(6) if a Triggering Event (other than a Triggering Event
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specified in clause (a) of the definition of Triggering Event) occurs within 12
months of the date of grant, 52,500 unvested shares shall immediately become
vested;
(7) if a Triggering Event (other than a Triggering Event
specified in clause (a) of the definition of Triggering Event) occurs between 12
months and 24 months of the date of grant, 191,157 unvested shares shall
immediately become vested;
(8) if a Triggering Event (other than a Triggering Event
specified in clause (a) of the definition of Triggering Event) occurs between 24
months and 36 months of the date of grant, 286,735 unvested shares shall
immediately become vested; and
(9) if a Triggering Event (other than a Triggering Event
specified in clause (a) of the definition of Triggering Event) occurs 36 months
or later after the date of grant, all unvested shares shall immediately become
vested.
Any increase in the value of the Company (and which increase is reflected in a
Valuation) which is directly caused by or related to an investment in the
Company or the merger into the Company, or acquisition by the Company, of
another business entity shall cause an increase in each Target Amount which has
not yet been achieved as of the date of such investment, merger or acquisition
equal to the increase in value caused by such investment, merger or acquisition.
A determination as to the current Valuation of the Company shall be made (i) on
an annual basis within 90 days after the end of the Company's fiscal year, (ii)
effective upon the consummation by the Company of any future financing and (iii)
promptly following any other event which involves the obtaining by the Company
of an independent valuation of the Company. "Valuation" means (1) in the case of
clause (i) of the preceding sentence, a valuation mutually agreed upon by you
and the Board of Directors, or if a mutually agreement cannot be reached, a
written determination of the valuation of the Company prepared by an independent
investment banking firm or appraisal company which is of national or regional
reputation and which is mutually acceptable to the Company and to you and which
valuation is prepared on a basis consistent with valuation methods typically
used by venture capitalists for investment bankers to value a business in the
same industry and state of development as the Company (it being agreed that such
valuation shall not be based on book value or liquidation value), (2) with
respect to clause (ii) of the preceding sentence, the valuation of the Company
in connection with such financing and (3) with respect to clause (iii) of the
preceding sentence, the independently prepared valuation referred to therein.
(iv) For avoidance of doubt, the parties expressly acknowledge
that the option grants referred to in (ii) and (iii) are not conditioned upon
the
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consummation of a Financing.
(v) Each of the options granted pursuant to this section shall
provide that vesting will continue during the first 60 days following the
termination of your employment by the Company.
(d) BENEFITS. You will be entitled to participate in or receive such
benefits under the Company's employee benefit plans and policies as in effect
from time to time and as are provided to senior management of the Company, as
well as the Weston financial retainer (up to a maximum of $10,000 per year) and
the Xxxxxxx split life policies (in the current policy amounts) which you
currently hold. The Company may change, amend, modify or completely eliminate
any benefit plan from time to time.
(e) BUSINESS EXPENSES. You will be entitled to reimbursement for
necessary and reasonable business expenses incurred by you in your employment
with the Company in accordance with accounting procedures as the Company shall
adopt from time to time.
(f) VACATION/HOLIDAYS. During your employment under this Agreement you
will be entitled to four weeks paid vacation, accrued in accordance with Company
policies, and Company holidays in accordance with the Company's holiday
policies, as they may be amended from time to time.
(g) RECEIPT OF DOCUMENTATION. You acknowledge that you have received
from the Company copies of the Stock Plan and the Company's benefit plans. You
understand and agree that the Company has reserved the right and option, in its
sole discretion, to change, interpret or modify these and all other plans or
policies at any time in accordance with the terms of the respective plans or
policies.
4. RESTRICTIONS AND CONDITIONS.
As an express condition of this Agreement and your continued employment
with the Company, you agree to comply with the agreements and other conditions
in this Section.
(a) AGREEMENT NOT TO DISCLOSE CONFIDENTIAL INFORMATION. While employed
by the Company and thereafter, you shall not, directly or indirectly, use any
Confidential Information (as hereinafter defined) other than pursuant to you
employment by and for the benefit of the Company, or disclose to anyone outside
of the Company any such Confidential Information. The term "Confidential
Information" as used throughout this Agreement shall mean all trade secrets,
proprietary information, inventions and developments, including customer lists,
business plans, and all other data or information (and any tangible evidence,
record
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or representation thereof), whether prepared, conceived or developed by an
employee of the Company (including you) or received by the Company from an
outside source, which is in the possession of the Company and which is
maintained in confidence by the Company or which might permit the Company or its
clients or customers (hereinafter collectively referred to as "Clients") to
obtain a competitive advantage over competitors who do not have access to such
trade secrets, proprietary information, or other data or information. This
provision does not apply to any Confidential Information that the Company has
voluntarily disclosed to the public or that has otherwise legally entered the
public domain. You understand that the Company from time to time has in its
possession information which is claimed by others to be proprietary and which
the Company has agreed to keep confidential. You agree that all such information
shall be Confidential Information for purposes of this Agreement.
(b) ASSIGNMENT OF DEVELOPMENTS. You agree that all Confidential
Information and all other discoveries, inventions, ideas, designs, concepts,
processes, methods and improvements or parts thereof, conceived or otherwise
made by you during the period of your employment by the Company, alone or
jointly with others and in any way relating to the Company's present or proposed
products or services or to tasks assigned to you during the course of your
employment, whether or not made during your regular working hours or on the
Company's premises (hereinafter collectively referred to as "Developments"),
together with all products or services which embody such Developments, shall be
the sole property of the Company. You agree to, and hereby do, assign to the
Company all your right, title and interest throughout the world in and to all
Developments and to anything tangible which evidences or constitutes any such
Development. You agree that all such Developments shall constitute works made
for hire under the copyright laws of the United States and hereby assign and, to
the extent any such assignment cannot be made at present, you hereby agree to
assign to the Company all copyrights, patents, reproductions and other
proprietary rights you may have in any such Development, together with the right
to file for and/or own wholly without restriction United States and foreign
patents, trademarks, and copyrights with respect thereto.
(c) EXCEPTIONS TO THIS AGREEMENT. You hereby certify that you have
informed the Company in writing of any and all continuing obligations which you
have to any previous employer and all Confidential Information or Developments
which you claim as your own or otherwise intend to exclude from this Agreement.
(d) EMPLOYEE'S OBLIGATION TO COOPERATE. You will, at any time during
your employment, or after it terminates, on request of the Company, execute all
documents and perform all lawful acts which the Company considers necessary or
advisable to secure its rights hereunder and to carry out the intent of this
Agreement.
(e) RETURN OF PROPERTY. At any time on request of the Company, you
shall
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return promptly all documents and other property belonging to the Company or its
Clients or business partners.
(f) RESTRICTIONS ON CERTAIN POST-EMPLOYMENT ACTIVITIES.
(i) As long as you are employed by the Company and for a period
of two years after the termination of your employment for any reason, you shall
not solicit, or induce to resign any employee of the Company (or anyone who was
an employee of the Company during the period beginning six months prior to your
termination of employment with the Company), or assist in such hiring by any
other person or business entity or encourage any such employee to terminate his
or her employment with the Company.
(ii) As long as you are employed by the Company, and (x) if you
are entitled to receive payments upon termination of your employment with the
Company under Section 5 below, then for a period of time following termination
of your employment equal to the period during which you receive such payments,
or (y) if you are not entitled to receive payments upon termination of your
employment with the Company under Section 5 below, then for a period of one year
following termination of your employment, you shall not either directly or
indirectly (a) solicit, divert or attempt to divert from the Company to yourself
or to any other person or business entity the business or patronage of any of
the Clients, prospective clients or business partners of the Company; or (b)
provide services, whether on your own behalf or as an owner, manager,
consultant, director, officer, partner or employee of any other person or
business entity, to any of the Clients, prospective clients of the Company;
provided, however that clause (b) shall not prohibit you from accepting
employment as a direct employee of Clients or business partners. You agree to
inform the Company of any activities that violate or may violate the terms of
this Section. In the event that you breach any of the terms of this Section, the
prohibitions set forth in this Section will remain in effect for one year from
the discovery of such breach by an officer of the Company.
(g) NO OTHER AGREEMENT. You warrant that you are not subject to any
agreement or obligation with any other party which would or could in any way
conflict with your obligations under this Agreement. You agree to indemnify and
hold harmless the Company from any claims, actions or damages arising from or
relating to a breach or alleged breach of this subsection.
(h) EQUITABLE REMEDIES; SURVIVAL. You and the Company agree that upon
a breach or violation of any provision of this Section 4, the Company, in
addition to all other remedies which might be available to it, shall be entitled
as a matter of right to equitable relief in any court of competent jurisdiction,
including the right to obtain injunctive relief or specific performance. You and
the Company agree that the remedies at law for any such breach or violation are
not fully adequate and that the
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injuries to the Company as a result of the continuation of any breach or
violation are incapable of full calculation in monetary terms and, therefore,
constitute irreparable harm. The provisions of this Section 4 shall survive
termination of this Agreement.
5. COMPENSATION AND BENEFITS UPON TERMINATION OF EMPLOYMENT.
Upon termination of your employment (such date of termination being
referred to as the "Termination Date"), the Company will pay you the
compensation and benefits as described in this Section 5.
(a) The Company will pay you on or about the Termination Date all
salary and vacation pay, if any, that has been earned or accrued through the
date of your termination from the Company and has not yet been paid.
(b) If your employment terminates at any time after the Effective Date
for any reasons other than:
(i) by the Company for embezzlement, fraud or conviction of a
felony,
or
(ii) by you for any reason;
the Company will pay you your Base Salary for a period of (x) six months
following your Termination Date if such termination is prior to your first
anniversary of employment; and (y) twelve months following your Termination Date
if such termination is after your first anniversary of employment.
(c) You may be entitled to continuation of applicable life insurance,
accidental death and disability or other benefits provided that you make an
appropriate conversion and comply with the requirements of the applicable
benefit plans.
(d) You will not be entitled to receive any other compensation or
benefits provided by, through or on behalf of the Company, other than benefits
that are vested as of the date of termination and that are payable in accordance
with the terms of any applicable benefit plan.
(e) For purposes of this Section 5, "cause" shall mean that you are
terminated for one or more of the following reasons:
(i) your substantial and continuing failure, after notice
thereof, to render services to the Company in accordance with the terms of this
Agreement;
(ii) your disloyalty, gross negligence, willful misconduct,
dishonesty
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or breach of fiduciary duty to the Company; or
(iii) your commission of any act of embezzlement or fraud; or
(iv) your deliberate disregard of material rules or material
policies of the Company which results in direct or indirect loss, damage or
injury to the Company; or (v) your breach or violation of this Agreement,
including without limitation your unauthorized disclosure of any Confidential
Information of the Company; or
(vi) your commission of an act which constitutes unfair
competition with the Company or which induces any customer or supplier to breach
a contract with the Company; or
(vii) you have been convicted of a felony, or
(viii) you have been engaged in the abuse of alcohol, illegal
drugs or controlled substances; or
(ix) your failure or inability to perform or execute tasks
assigned by the Board of Directors, including without limitation, your failure
or inability to achieve performance targets or goals, or which are within the
scope of the responsibilities of the Position and which are similar to the tasks
performed by individuals holding similar positions in companies which are of
comparable size and in which are in the technologies services field.
(f) You acknowledge and agree that the compensation and benefits
provided above have been negotiated with the Company and shall be deemed to
fully satisfy any notice requirements which may be required by any jurisdiction.
This Section 6 constitutes your only rights to compensation, benefits, damages,
or other remedies arising out of the termination of your employment.
(g) The provisions of this Section 5 shall survive termination of this
Agreement.
6. GENERAL.
(a) EMPLOYMENT ELIGIBILITY. From time to time after your first day of
employment, you may be asked to provide proof of your identity as well as your
legal right to work in the United States. If for any reason you are unable to
provide proof of your identity as well as your legal right to work in the United
States, the Company may not be able to employ you in the Position and may
terminate your employment. If you are a citizen of a restricted country (as
identified by the U.S.
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Department of Commerce) you must receive a validated license from the Office of
Export Licensing. This license must be obtained within a time limit established
by the Company.
(b) GOVERNING LAW. The validity, interpretation, effect, and
enforcement of this Agreement shall be governed by the internal laws of the
Commonwealth of Massachusetts, without regard to choice of law rules.
(c) ENTIRE AGREEMENT. In making your decision whether or not to accept
this offer, you agree that you have not relied upon any promises or
representations made by the Company, other than those made in this letter. This
Agreement and the agreements referred to herein or to be executed pursuant to
the provisions herein set forth the entire Agreement and understanding between
you and the Company, and supersede any other negotiations, agreements,
understandings, oral agreements, representations or past or future practices,
whether written or oral, with, by or of the Company.
Each Company plan or policy referred to herein directly or by implication
is incorporated herein only insofar as it does not contradict this Agreement. If
any inconsistencies between this Agreement and any such plan or policy or future
plan or policy exist, the most recent applicable plan document or official
policy shall control.
(d) MODIFICATION. This Agreement may not be amended, modified, changed
or discharged in any respect except as agreed in writing and signed by you and
the Co-Chairmen or Chairman of the Board of Directors of the Company.
(e) SEVERABILITY AND INTERPRETATION. In the event that any provision
or any portion of this Agreement is held invalid or unenforceable by a court of
competent jurisdiction, such provision or portion thereof shall be considered
separate and apart from the remainder of this Agreement and the other provisions
shall remain fully valid and enforceable. In the event that any provision is
held to be overly broad as written, such provision shall be deemed amended to
narrow its application to the extent necessary to make the provision enforceable
according to applicable law and enforced as amended.
(f) NOTICES. All notices required by this Agreement shall be given in
writing either by personal delivery or by first class mail, return receipt
requested. Notices given to the Company shall be addressed to the Company at its
address set forth on the first page of this Agreement, or at such later address
where the Company's principal offices are located. Notice to you shall be to the
last known address as set forth in your personnel file. Notice given by personal
delivery shall be deemed given when delivered. Notice given by mail shall be
deemed given five (5) days following the date of mailing.
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(g) MISCELLANEOUS. The rights of the Company under this Agreement
shall inure to the benefit of and shall be binding upon the present and future
subsidiaries of the Company, any and all subsidiaries of a subsidiary, and
successors and assigns of the Company. No assignment of this Agreement by the
Company will relieve the Company of its obligations hereunder. You shall not
assign any of your rights and/or obligations under this Agreement and any such
attempted assignment will be void. This Agreement shall be binding upon your
heirs, executors, administrators or other legal representatives and their legal
assigns.
(h) WAIVER. A waiver by either party of any of the terms or conditions
of this Agreement in any instance shall not be deemed or construed to be a
waiver of such term or condition for the future, or of any subsequent breach
thereof. All remedies, rights, undertakings, obligations and agreements
contained in this Agreement shall be cumulative and note of them shall be in
limitation of any other remedy, right, undertaking, obligation or agreement of
either party.
(i) SURVIVAL. The provisions of this Section 6 shall survive
termination of this Agreement.
(j) DIRECTORS AND OFFICERS LIABILITY INSURANCE. During the term of
this Agreement, the Company agrees to maintain Directors and Officers Liability
Insurance in amounts and with scope(s) of coverage deemed reasonable and
appropriate by the Board of Directors.
(k) ALLOCATION OF OPTIONS FOR NEW HIRES. The Company agrees that it
has reserved or that it shall reserve for issuance to directors, employees and
others a number of shares of Common Stock which shall be equal to 10% of the
Company's issued and outstanding capital stock following the close of the
Financing (and you acknowledge that the Company may reduce the number of shares
available under its 1998 Stock Plan so that the available shares under such plan
are equal to such 10% amount); provided, however, that if the Financing does not
occur, the number of reserved shares shall be equal to 10% of the Company's
issued and outstanding capital stock as of the date of this Agreement. The
parties agree that such shares shall be the only shares which the Company
intends to reserve and allocate for issuance to employees, directors, advisors
or to any other third party (except in connection with a financing) for a period
of two (2) years commencing on the Effective Date. The issuance of such shares,
including without limitation, the form in which such shares are issued (i.e.,
options, restricted stock or otherwise), the number of shares issued, the
recipients of such shares and terms and conditions relating to such issuances
shall be at the sole discretion of the Company's Board of Directors.
(l) CTP INDEMNIFICATION. The Company agrees to indemnify you and hold
you harmless for any claims, costs, liabilities and expenses incurred by you in
connection with the defense of any threatened or actual litigation brought by
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Xxxxxxxxx Xxxxxxxxxx Partners, Inc. against you or the Company arising from or
related to your employment by the Company; provided, however, that in no event
shall the Company be obligated to provide the foregoing in connection with any
claim based on any act of embezzlement, fraud or the commission of a felony.
(m) EXECUTION OF OPTION AGREEMENTS. Promptly following execution of
this Agreement, the Company and you will enter in to option agreements in
accordance with Sections 3(c)(ii) and 3(c)(iii) above (and with respect to the
options referenced in Section 3(c)(i) will agree upon the form of option
agreement(s)) for the options referenced therein, which agreements shall contain
terms and conditions mutually agreed upon by both parties. If the parties are
unable to enter in to such agreements or otherwise agree upon the terms and
conditions thereof by December 2, 1998 (or such later date that the parties
agree upon) then as of such date this Agreement shall be null and void and of no
further force or effect.
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If you agree with the foregoing, please sign below and return the
original to me. You may keep the enclosed copy for your records.
Sincerely,
BreakAway Solutions, Inc.
/S/XXXXX XXXXXXXXX
---------------------------
Xxxxx Xxxxxxxxx, President
Agreed to this 11th day of December, 1998
Employee: /S/ XXXXXX XXXXXX
----------------------------
Xxxxxx Xxxxxx
