EXHIBIT 10.04
April 1, 2002
Xxxx Xxxxxxxx
Dear Xxxx:
This letter agreement between you and HNC Software Inc. ("HNC") sets forth and
confirms the current terms and conditions of your employment with HNC effective
as of April 1, 2002 (the "EFFECTIVE DATE"), including certain modifications that
will supersede and replace provisions of your prior employment agreement dated
as of April 11, 2001 to the extent provided in Section 15 below. The provisions
of this letter agreement have been approved by the Compensation Committee (the
"COMPENSATION COMMITTEE") of HNC's Board of Directors (the "HNC BOARD").
1. Title. HNC is employing you as its Chief Operating Officer and as such
you will report to HNC's Chief Executive Officer. You agree to perform the
duties requested of you by the HNC Board, any committee of the HNC Board or
HNC's Chief Executive Officer.
2. Salary. Your base salary will remain at its current annual rate of
$341,250 per year. Your base salary may be increased in the discretion of the
HNC Board or the Compensation Committee.
3. 2002 Bonus Plan. You will continue to be eligible to potentially receive
a target bonus of up to a maximum of 50% of your current annual base salary
under HNC's Incentive Compensation Plan for fiscal 2002 (the "2002 BONUS PLAN"),
depending on the extent to which you achieve your bonus objectives under the
2002 Bonus Plan as previously determined by the HNC Board. Nothing in this
agreement is intended to modify or change in any respect any of the provisions,
terms or conditions of the 2002 Bonus Plan or any of your bonus objectives under
the 2002 Bonus Plan.
4. At-Will Employment. Your employment with HNC will continue to be on an
"at-will" basis, meaning that your employment with HNC may be terminated by you
or by HNC at any time and for any reason whatsoever, with or without cause or
advance notice. This at-will employment relationship cannot be changed except as
may be expressly set forth in a written instrument that has been authorized by
the HNC Board or the Compensation Committee and has been signed on behalf of HNC
by an authorized officer of HNC (other than yourself).
5. Certain Defined Terms. As used in this agreement, the following terms
will have the meanings provided below:
"CAUSE" will mean: (i) your repeated and continued failure to perform
your duties and responsibilities as an HNC employee (including but not limited
to your compliance with any written policy of HNC) in good faith to the best of
your ability after written notice to that effect from HNC; (ii) your material
breach of your Employee Invention Assignment and Confidentiality Agreement with
HNC then in effect (your "HNC INVENTION ASSIGNMENT/CONFIDENTIALITY AGREEMENT")
that is not susceptible to cure or that is not cured within five (5) business
days after you are given notice of such breach by the HNC Board, any committee
of the HNC Board or HNC's Chief Executive Officer; (iii) your commission of (or
your being convicted of or pleading guilty to) a felony (provided, that for
purposes of this paragraph the term "FELONY" will not include traffic violations
which do not involve your willful infliction of death or serious injury to
others); or (iv) your commission of an act of fraud or your misappropriation of
property of the Company or any of its affiliates, subsidiaries or successors.
"CHANGE IN CONTROL" will mean: (i) a merger or consolidation of HNC with
or into another corporation or other entity that is consummated after the
Effective Date, where the stockholders of HNC immediately prior to the
consummation of such merger or consolidation do not hold, immediately after the
consummation of such merger or consolidation, stock possessing at least a
majority of the total voting power of all the outstanding stock of the
corporation or other entity that is the survivor of such merger or consolidation
(or of survivor's parent); (ii) a transaction or series of related transactions
occurring after the Effective Date that results in the sale of the beneficial
ownership of more than fifty percent (50%) of the then outstanding voting stock
of HNC to a single party (or to a group of affiliated parties or a group of
parties acting in concert); or (iii) a sale or other disposition by HNC after
the Effective Date of all or substantially all its assets and properties, where
the stockholders of HNC immediately prior to the consummation of such sale or
other disposition do not hold, immediately after the consummation of such sale
or other disposition, stock possessing at least a majority of the total voting
power of all the outstanding stock of the purchaser of HNC's assets and
properties in such sale or disposition.
"COBRA" means the provisions of Section 4980B of the Internal Revenue
Code of 1986, as amended (the "CODE"), adopted as part of the Consolidated
Omnibus Budget Reconciliation Act, which allow former employees of an employer
to continue to receive health and medical insurance benefits, at their expense,
for a specified time period.
"DEEMED TERMINATION" OR "DEEMED TERMINATED" will mean: (i) a significant
reduction of your duties, title, position or responsibilities relative to your
duties, position or responsibilities in effect immediately prior to such
reduction (including a material change in your reporting structure, which shall
include, but not be limited to, your no longer reporting to HNC's Chief
Executive Officer) that is effected without your consent or agreement; (ii) a
substantial reduction, without good business reasons, of the facilities and
perquisites available to you immediately prior to such reduction if such
reduction is effected without your consent or agreement; (iii) a reduction of
your base salary and target bonus as in effect immediately prior to such
reduction if such reduction is effected without your consent or agreement (other
than any such reduction that is effected on substantially a company-wide basis
in order to reduce HNC's operating expenses); or (iv) the relocation of your
primary office at HNC to a facility or location that is more than fifty (50)
miles away from your primary office location immediately prior to such
relocation, if such relocation is effected without your consent or agreement.
"DEEMED TERMINATION DATE" means the date on which the Deemed Termination occurs.
Your "TARGET BONUS" for a specified HNC fiscal year means the percentage
of your annual base salary rate that is designated by the HNC Board or by the
Compensation Committee as a target bonus for HNC employees at your then-current
salary grade level for that HNC fiscal year.
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"TERMINATION FOR CAUSE" or "TERMINATED FOR CAUSE" means a termination of
your employment by HNC where the HNC Board or any committee of the HNC Board
terminates your employment after determining that Cause exists.
"TERMINATION WITHOUT CAUSE" or "TERMINATED WITHOUT CAUSE" means a
termination of your employment by HNC without a determination by the HNC Board
or a committee of the HNC Board that Cause exists for such termination.
A "TERMINATION FOR DEATH OR DISABILITY" will occur, and your employment
with HNC will automatically terminate, upon your death or upon your Disability
(as defined below) as determined by the HNC Board or the Compensation Committee.
"DISABILITY" will mean your complete inability to perform your job
responsibilities for HNC for a period of 180 consecutive days, or 180 days in
the aggregate during any twelve (12) month period, due to your mental or
physical injury or disability.
"TERMINATION DATE" will mean the first date after the Effective Date on
which you cease to be employed by HNC (or an affiliate or subsidiary of HNC) for
any reason.
6. Benefits Under Certain Circumstances Prior to a Change of Control. In
the event that, prior to consummation of a Change of Control, you are (i)
Terminated Without Cause, (ii) Deemed Terminated or (iii) there occurs a
Termination for Death or Disability, then the following provisions will apply
(and the provisions of Section 7 of this Agreement will not apply or ever be
applicable):
(a) Cash Payment. Within thirty (30) days after the Termination Date (or
within thirty (30) days after the Deemed Termination Date, in the case of a
Deemed Termination) you will be paid by HNC a one-time cash severance payment in
an amount equal to the sum of (i) your annual base salary rate in effect on the
Termination Date (or, in the case of a Deemed Termination, as in effect
immediately prior to the Deemed Termination Date) plus (ii) your Target Bonus in
effect on the date on which you are Terminated Without Cause, are Deemed
Terminated or on which there occurs a Termination for Death or Disability, less
all applicable payroll and tax deductions and withholdings.
(b) Acceleration of Option Vesting. On the Termination Date (i) the
vesting of your right to exercise all then outstanding HNC common stock options
then held by you (collectively your "OPTIONS") that are then unvested will
accelerate so that your Options will then be vested and exercisable to the same
extent that they would have been vested and exercisable (under the provisions of
the Options that provide vesting based solely on your continuous employment) if
you had remained continuously employed by HNC until one (1) year after the
Termination Date, and (ii) all your Options will continue to be exercisable by
you for a period ending upon the earlier of (A) one (1) year after the
Termination Date or (B) the date on which your Options would otherwise expire
(other than an expiration due solely to termination of your employment) in
accordance with their respective original terms; provided, however, that if the
operation of this Section 6 is triggered by a Deemed Termination, then all
references in this Section 6(b) (other than the reference to the "Termination
Date" in clause (ii) above) will, solely for purposes of this Section 6(b),
refer to and mean the Deemed Termination Date rather than the Termination Date.
The foregoing provisions of this Section 6(b) amend the current terms of your
Options but will not adversely affect or change the vesting acceleration
provisions now contained in your currently outstanding Options which provide for
accelerated vesting if the trading price of HNC's common stock reaches certain
levels for certain periods of time.
(c) COBRA Reimbursement. HNC will reimburse you for any verified
payments that you actually make pursuant to your rights under COBRA in order to
continue your coverage under HNC's health and medical insurance benefit plans
during the Continuation Period (as defined below). As used herein, the
"CONTINUATION PERIOD" means that time period beginning on the Termination Date
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and ending upon the earlier to occur of: (i) eighteen (18) months after the
Termination Date, (ii) the first date on or after the Termination Date on which
you commence employment with any other employer who provides you with health and
medical insurance benefits or (iii) the first date on which you cease to be
eligible under COBRA to continue your coverage under HNC's health and medical
insurance benefit plans.
(d) Continuation of Life Insurance. During (and only during) the
Continuation Period, HNC will, at its expense continue your coverage under any
life insurance benefits in which you are participating in your capacity as an
HNC employee immediately prior to the Termination Date (if any), to the extent
permitted under any such life insurance benefit plan(s) or policy(ies) or
pursuant to any riders thereto that HNC may obtain using commercially reasonable
efforts and without increasing HNC's cost to maintain such plan(s) or
policy(ies) by more than thirty percent (30%).
(e) Scope of this Section. The provisions of this Section 6 shall not
apply to any termination of your employment other than a Termination Without
Cause, a Deemed Termination or a Termination for Death or Disability.
7. Effect of Change of Control. In the event that you are employed by HNC
immediately prior to the consummation of the first Change of Control to occur
after the Effective Date (the "TRIGGER CHANGE OF CONTROL"), then the following
provisions will apply:
(a) Cash Payment. Subject to the provisions of this Section 7(a), upon
the consummation of the Trigger Change of Control, you will become entitled to
be paid by HNC (or its successor) a cash payment (the "CHANGE OF CONTROL
PAYMENT") in an amount equal to the sum of (i) the product obtained by
multiplying your then-current annual base salary rate by the Multiplier (as
defined below) plus (ii) the product obtained by multiplying your Target Bonus
in effect on the date on which the Trigger Change of Control is consummated by
the Multiplier (less all applicable payroll and tax deductions and
withholdings), on the following terms and conditions. The Change of Control
Payment shall be payable to you in installments as follows: (i) eighty percent
(80%) of such Change of Control Payment will be paid to you upon the date of the
consummation of the Trigger Change of Control, and (ii) the remaining twenty
percent (20%) of such Change of Control Payment (the "REMAINING PAYMENT") will
be paid to you upon the earliest to occur of (A) a Termination Without Cause
occurring after consummation of the Trigger Change of Control, (B) a Deemed
Termination occurring after the consummation of the Trigger Change of Control,
(C) three (3) months after consummation of the Trigger Change of Control, or (D)
your death or your Disability (as defined in Section 5 above) occurring after
the consummation of the Target Change of Control; provided, however, that if you
breach your obligations under Section 9 below at any time prior to your receipt
of the Remaining Payment, then you will forfeit, and will have no right to
receive, the Remaining Payment or any part thereof. As used herein, the
"Multiplier" means the sum of (i) 1.0 plus (ii) the product obtained by
multiplying one-twentieth (0.05) by the number of full six (6)-month periods
during which you have been continuously employed by HNC on the date immediately
prior to the date on which the Trigger Change of Control is consummated; for
example, if you have been employed by the Company for 3.75 years as of the date
immediately prior to the date on which the Trigger Change of Control is
consummated, then your Multiplier would be 1.35 (1.0 plus 0.05 multiplied by the
number of full six-month periods (7) you were employed by the Company in this
example as of immediately prior to the consummation of the Trigger Change of
Control).
(b) Acceleration of Option Vesting. Immediately prior to the
consummation of the Trigger Change of Control, the vesting of your right to
exercise all then outstanding HNC common stock options then held by you
(collectively your "OPTIONS") that are then unvested will accelerate in full so
that all your Options will then be fully vested and exercisable in full, and all
your Options will continue to be exercisable by you until the later of (i) one
(1) year after the date of the consummation of the Trigger
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Change of Control or (ii) the date on which your Options would otherwise
terminate or expire in accordance with their original terms. The foregoing
provisions of this Section 7(b) amend the current terms of your Options but will
not adversely affect or change the vesting acceleration provisions now contained
in your currently outstanding Options which provide for accelerated vesting if
the trading price of HNC's common stock reaches certain levels for certain
periods of time.
(c) COBRA Reimbursement. If you are Terminated Without Cause or are
Deemed Terminated on, or within three (3) months after, the date of the
consummation of the Trigger Change of Control, then HNC or its successor will
reimburse you for any verified payments that you actually make pursuant to your
rights under COBRA in order to continue your coverage under HNC's health and
medical insurance benefit plans during the COC Continuation Period (as defined
below). As used herein, the "COC CONTINUATION PERIOD" means that time period
beginning on the Termination Date and ending upon the earlier to occur of: (i)
eighteen (18) months after the Termination Date, (ii) the first date on or after
the Termination Date on which you commence employment with any other employer
who provides you with health and medical insurance benefits, or (iii) the first
date on which you cease to be eligible under COBRA to continue your coverage
under HNC's health and medical insurance benefit plans.
(d) Continuation of Life Insurance. During (and only during) the COC
Continuation Period, HNC will, at its expense continue your coverage under any
life insurance benefits in which you are participating in your capacity as an
HNC employee immediately prior to the Termination Date (if any), to the extent
permitted under any such life insurance benefit plan(s) or policy(ies) or
pursuant to any riders thereto that HNC may obtain using commercially reasonable
efforts and without increasing HNC's cost to maintain such plan(s) or
policy(ies) by more than thirty percent (30%).
(e) 280G Payment.
(i) In the event that a Trigger Change of Control occurs and is
consummated on or before April 1, 2003 and, on or after the consummation of such
Trigger Change of Control, the benefits provided for in this Agreement or any
other benefits approved at any time by the HNC Board or the Compensation
Committee and otherwise payable to you (including stock options) constitute
"parachute payments" within the meaning of Section 280G of the Code and will be
subject to the excise tax imposed by Section 4999 of the Code, then, subject to
the provisions of Section 7(g) below, you shall receive from HNC (A) a cash
payment sufficient to pay such excise tax, and (B) an additional payment
sufficient to pay the excise tax and federal and state income and employment
taxes arising from the payments made by HNC to you pursuant to this sentence;
provided, however, that notwithstanding the foregoing, the total aggregate
amount of all of the payments to be made to you under this Section 7(e) shall in
no event exceed an amount equal to the greater of (1) the amount that would be
payable to you under the preceding clauses (A) and (B) of this sentence if the
Per Share Return (as defined in Section 7(f) below) is exactly $25.00 or (2)
your Pro Rata Share (as defined below) of 0.30% of the Total Return (as defined
below) if the Per Share Return is greater than $25.00 (where the foregoing
references to such $25.00 per share amount will each be subject to proportionate
and equitable adjustment to reflect any subdivisions or splits of HNC's common
stock, any combinations or reverse stock splits of HNC's common stock or any
dividends of HNC common stock that occur after the Effective Date).
(ii) Unless HNC and you otherwise agree in writing, the
determination of your excise tax liability and the amount required to be paid to
you by HNC under this Section 7(e) shall be made in writing by HNC's independent
accountants (the "ACCOUNTANTS"), and the amounts to be paid to you by HNC under
this Section 7(e) will be paid to you within thirty (30) days after the
Accountants have finally determined that amount as provided herein (or such
shorter time after the Accountants have finally determined that amount as may be
necessary in order for you to timely pay any withholding or estimated tax
obligations arising from your receipt of any payment under this Section 7(e)).
For purposes
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of making the calculations required by this Section 7(e), 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. HNC and you shall furnish to the Accountants
such information and documents as the Accountants may reasonably request in
order to make a determination under this Section 7(e). HNC shall bear all costs
the Accountants may reasonably incur in connection with any calculations
contemplated by this Section 7(e).
(iii) In the event that the Internal Revenue Service ("IRS")
determines that the amount of excise tax payable by you as described above in
this Section 7(e) is different than the amount of such excise tax as determined
by the Accountants as provided above, then: (A) if the amount of such excise tax
payable by you as determined by the IRS is less than the amount of such excise
tax as computed by the Accountants, you will reimburse HNC for all excess
amounts actually paid to you by HNC under this Section 7(e) due to the
over-calculation of such excise tax by the Accountants within five (5) business
days after you receive either a refund from the IRS due to such over-calculation
or you receive an economic benefit from the IRS (such as a credit against tax
payable) on account of such over-calculation, provided you reported and paid all
your excise and income tax liabilities resulting from the operation of this
Section 7(e) consistent with the amounts you were actually paid hereunder; and
(B) if the amount of such excise tax payable by you as determined by the IRS is
greater than the amount of such excise tax as computed by the Accountants, then
HNC will promptly reimburse you for the amounts that HNC underpaid you under
this Section 7(e) due to the under-calculation of such excise tax by the
Accountants within five (5) business days after it receives either a refund from
the IRS due to such over-calculation or it receives an economic benefit from the
IRS (such as a credit against tax payable) on account of such under-calculation.
(iv) The foregoing provisions of this Section 7(e) shall not apply
with respect to any Trigger Change of Control that is consummated after April 1,
2003 and HNC will have no obligation to make any payment to you under this
Section 7(e) with respect to any Trigger Change of Control that is consummated
after April 1, 2003.
(f) As used in Section 7(e) above:
(i) The term "PER SHARE RETURN" means the dollar value (determined
as provided below) of the consideration that is paid with respect to one (1)
share of outstanding HNC common stock in the Trigger Change of Control ("CHANGE
OF CONTROL CONSIDERATION"), with the value of such Change of Control
Consideration to be determined as follows: (A) to the extent that the Change of
Control Consideration consists of stock or other securities for which there is a
trading market, the value of such stock or other securities will be deemed to be
the closing price of such stock or other securities on the date on which the
Trigger Change of Control is consummated; (B) to the extent that the Change of
Control Consideration consists of stock or other securities for which there is
no trading market, the value of such stock or securities shall be determined in
good faith by HNC's Board of Directors as of the date on which such Trigger
Change of Control is consummated; and (C) to the extent that the Change of
Control Consideration consists of cash, the amount of such cash.
(ii) The term "PRO RATA SHARE" will mean the percentage obtained by
dividing (A) the amount (if any) that would be payable to you under subsection
7(e)(i) if the proviso in subsection 7(e)(i) was not included in such sentence,
by (B) the total aggregate amount that would be payable to the Designated
Officers (as defined below) with respect to the Trigger Change of Control under
a provision of any employment or similar agreement they may have with HNC which
is similar in purpose or intent to the provisions of subsection 7(e)(i) of this
Agreement without regard to any proviso such as is contained in subsection
7(e)(i). As used herein, the term "DESIGNATED OFFICERS" means you and Xxxxxxx
Xxxxxxxxxx, Xxxx Xxxxx, Xxxxxxx Xxxxxxxx and Xxxxxxx Xxxxxxxx.
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(iii) The term "TOTAL RETURN" will mean the dollar amount equal to
the product obtained by multiplying the Per Share Return by the total number of
shares of HNC common stock that are issued and outstanding (excluding treasury
shares) immediately prior to the consummation of the Target Change of Control.
(g) Election of Employee Regarding Parachute Payments. If a Trigger
Change of Control occurs and is consummated and, on or after the consummation of
such Trigger Change of Control, the benefits provided for in this Agreement or
any other benefits approved at any time by the HNC Board or the Compensation
Committee and otherwise payable to you (including stock options) constitute
"parachute payments" within the meaning of Section 280G of the Code and will be
subject to the excise tax imposed by Section 4999 of the Code, then you may, at
your sole option and discretion, elect to waive, not receive and/or reduce such
benefits to such lesser extent as will result in no portion of such benefits
being subject to the excise tax imposed by Section 4999 of the Code, and in that
case HNC's obligation to make a payment to you pursuant to the provisions of
Section 7(e) will be correspondingly reduced.
(h) Scope of this Section. The foregoing provisions of this Section 7
shall only apply with respect to, and shall only be triggered by, the Trigger
Change of Control and the provisions of Section 7(e)(i) will apply only in the
event that a Trigger Change of Control is consummated on or before April 1,
2003.
8. Release Required. Notwithstanding anything herein to the contrary, you
agree that the provisions of Sections 6 and/or 7 above (as applicable) will not
apply unless and until (i) you have executed a general release agreement in
substantially the form of Exhibit "A" attached hereto of all known and unknown
claims that you may then have against HNC and/or persons or entities affiliated
with HNC due to your termination of employment or any Deemed Termination (the
"RELEASE AGREEMENT") and (ii) you have agreed not to prosecute or bring any
legal action or other proceeding based upon any of such claims. Upon your
execution and delivery of such Release Agreement, HNC will enter into a Limited
Release Agreement with you in the form of Exhibit "B" attached hereto.
9. Obligation to Provide Transition Services After Change of Control.
Whether or not you are then employed by HNC, you agree that, during the three
(3) month period immediately following the consummation of the Trigger Change of
Control (the "TRANSITION PERIOD"), so long as HNC or its successor agrees to pay
you a monthly gross cash compensation that (prior to any applicable payroll and
tax deductions and withholdings), is not less than your monthly base salary rate
as in effect immediately prior to the consummation of the Trigger Change of
Control (the "REQUIRED COMPENSATION"), you will, at your election, (i) continue
your active employment with HNC or its successor in good faith or (ii) provide
services to HNC and/or its successor in good faith as an independent contractor
and consultant within your areas of prior experience at HNC, in each case as and
when reasonably requested by HNC or its successor. You further agree that,
during the Transition Period, for so long as HNC or its successor agrees to pay
you the Required Compensation you will keep yourself available to perform the
services described in the preceding sentence for HNC or its successor at the
physical location at which your primary office with HNC was located immediately
prior to the consummation of the Trigger Change of Control. You will not be
deemed to be in breach of this Section 9 by reason of your death or any illness
or physical disability that prevents you from performing your obligations under
this Section 9.
10. Non-Solicitation. You agree that during your employment with HNC, and
for a period of one (1) year after termination of your employment with HNC, you
will not for any reason, whether directly or indirectly: (a) solicit, recruit,
take away or attempt to take away, any employee or consultant of HNC or any of
its affiliates, or induce (or attempt to induce) any employee or consultant of
HNC or any of its affiliates to terminate his or its employment or services with
HNC or any of HNC's affiliates; or
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(b) use any confidential or proprietary information of HNC or any of it is
affiliates to, directly or indirectly, solicit any customer of HNC or any of its
affiliates or induce any customer of HNC or its affiliates to terminate its
relationship with HNC or any HNC affiliate; provided, however, that this
non-solicitation provision shall not prevent you from hiring any employee of
consultant of HNC or any of its affiliates that you can demonstrate either (i)
approached you independently without any prior direct or indirect solicitation
or encouragement by you or on your part, or (ii) replied to a solicitation made
to the general public without any direct or indirect solicitation or
encouragement by you or on your part. You and HNC agree that the foregoing
provisions of this Section 10 will entirely supersede and replace any directly
conflicting or contrary provisions contained in your currently existing HNC
Invention Assignment/Confidentiality Agreement.
11. Acknowledgment. By signing this letter you acknowledge and agree that,
if the time during which you are permitted to exercise your Options after
termination of your employment is in fact extended as provided above in Section
6(b) or Section 7(b), then you may be unable to treat any of your Options as
"incentive stock options" within the meaning of the Code for federal income tax
purposes, and that you are willing to assume that risk.
12. Governing Law. This agreement will be governed by the internal laws of
the State of California without reference to its conflict of laws provisions.
13. Arbitration. We agree that, except as otherwise provided by law, any
dispute or claim (whether based on contract, tort or otherwise), relating to or
arising out of this agreement, your employment with HNC, your termination of
employment with HNC or otherwise pertaining to the workplace (including but not
limited to claims for compensation, discrimination or harassment claims, or
claims for wrongful termination), shall be subject to mandatory and binding
arbitration conducted through the American Arbitration Association ("AAA") in
San Diego, California before a single arbitrator in accordance with the National
Rules for the Resolution of Employment Disputes of the AAA in effect at that
time, and that judgment upon the determination or award rendered by the
arbitrator may be entered in any court having jurisdiction over the parties;
provided, however, that notwithstanding the foregoing, you and HNC acknowledge
and agree that you and HNC will retain the right to, and will not be prohibited
or restricted from, seeking or obtaining equitable relief (including injunctive
relief) from a court having jurisdiction.
14. Successors and Assigns. This agreement will be binding upon you (and
your successors, heirs and assigns) and any successor (whether direct or
indirect and whether by purchase, lease, merger, consolidation, liquidation or
otherwise) to all or substantially all of HNC's business and/or assets. For all
purposes of this agreement, the term "HNC" shall include any successor to HNC's
business and/or asserts which becomes bound by this agreement.
15. Entire Agreement. This agreement and your HNC Invention Assignment /
Confidentiality Agreement contain the entire agreement and understanding of the
parties with respect to the subject matter hereof. You hereby confirm and agree
that, subject to the provisions of Section 10, you will continue to be bound by
and subject to all the terms and conditions of your HNC Invention Assignment /
Confidentiality Agreement. This agreement will supersede in its entirety, and
will terminate any surviving provisions of your prior agreement with HNC dated
as of April 11, 2001 other than the provisions of the second to last paragraph
of your April 11, 2001 agreement regarding your compliance with Company policies
and procedures.
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16. Counterparts. This agreement may be executed in counterparts.
We look forward to your continued contributions as part of the HNC team.
Please indicate your acceptance and agreement to the terms of this agreement by
signing this letter at the space indicated below.
Sincerely yours,
HNC SOFTWARE INC.
By: /s/ XXXX XXXXX
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Xxxx Xxxxx, Chief Executive Officer
By signing this letter, I hereby accept and agree to this agreement and all the
provisions set forth above.
/s/ XXXX XXXXXXXX
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Xxxx Xxxxxxxx
Dated: April 3, 2002
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EXHIBIT "A"
SETTLEMENT AGREEMENT AND GENERAL RELEASE
THIS SETTLEMENT AGREEMENT AND GENERAL RELEASE is made and entered into by
and between XXXX XXXXXXXX (hereinafter referred to as "EMPLOYEE") and HNC
SOFTWARE INC., a Delaware corporation (hereinafter referred to as the
"COMPANY"), for and on behalf of the Company and its subsidiaries and affiliated
entities.
Whereas, pursuant to a letter agreement dated as of April 1, 2002 between
Employee and the Company, Employee has agreed to enter into this Settlement
Agreement and General Release in order to fully and finally settle all
differences between Employee and the Company and to grant the Company a general
release of claims, including, but not limited to, any differences or claims that
might arise out of Employee's employment with the Company, and the termination
of Employee's employment with the Company;
NOW THEREFORE, in consideration of the premises and the mutual promises
contained in this Agreement, the parties hereby agree as follows:
1. Employee releases and discharges the Company, its successors and
assigns, subsidiaries, affiliates, and the past and present employees, officers,
directors, stockholders, agents, attorneys and representatives of the Company
and its subsidiaries and affiliates (the Company, together with its successors,
subsidiaries, affiliates, and such employees, officers, directors, stockholders,
agents, attorneys and representatives being collectively referred to as the
"COMPANY RELEASEES") from all claims, liabilities, demands and causes of action
known or unknown, fixed or contingent, which Employee has or may hereafter have
arising out of or in any way connected with his employment with the Company, or
the termination of Employee's employment with the Company; provided, however,
that the foregoing release and discharge will not release or discharge the
Company from any of its unperformed express obligations to Employee under (i)
that certain letter agreement between the Company and Employee dated as of April
1, 2002 which sets forth and amends terms of Employee's employment with the
Company (the "LETTER AGREEMENT"); or (ii) this Agreement.
2. This Settlement and General Release shall not in any way be construed as
an admission by the Company or any Company Releasee that it has acted wrongfully
with respect to the Employee or any other person, that the Employee has acted
wrongfully, or that the Employee has any rights whatsoever against the Company
or any Company Releasee. The Company specifically disclaims any liability to
Employee or any wrongful acts against Employee or any other person, on the part
of itself, its employees, agents and all Company Releasees. Rather, the parties
have entered into this settlement and release in order to lend greater certainty
to the existing state of affairs in exchange for the promises and considerations
herein.
3. Employee represents, understands and agrees that Employee's employment
with the Company terminated on _________, 20___.
4. Employee understands that various federal, state and local laws prohibit
age, sex, race or other forms of discrimination and that these laws are enforced
through the U.S. Equal Employment Opportunity Commission, and state and local
human rights agencies. Employee understands that if Employee believed that
Employee's treatment by the Company or any Company Releasee has been
discriminatory, Employee has had the right to consult with these agencies and to
file a charge with them.
Employee has decided voluntarily to enter into this Settlement Agreement and
General Release, and waive the right to recover any amounts to which Employee
may have been entitled under such laws.
5. Employee represents and agrees that Employee will keep the terms and
amount of this Settlement Agreement and General Release completely confidential,
and that Employee will not disclose any information concerning this Settlement
Agreement and General Release to anyone, other than Employee's spouse and tax
preparer, if any, or as required by legal process or applicable law; provided
however, that Employee will first notify the Company if such disclosure is
sought, allowing the Company the opportunity to object to such disclosure. In
addition, Employee may disclose any information contained in this Settlement
Agreement and General Release which the Company has previously made public
disclosure of.
6. It is agreed that the benefits contained in this Settlement Agreement
and General Release which flow to Employee from the Company are subject to
termination, reduction or cancellation in the event that Employee takes any
action or engages in any conduct in material violation of this Agreement.
7. Employee represents and agrees that this Settlement Agreement and
General Release is binding upon himself, his estate, heirs, successors and
assigns.
8. Employee represents and agrees that the Company has advised Employee to
consult with an attorney regarding aspects of this Settlement Agreement and
General Release and that to the extent, if any, that Employee desired, Employee
has availed himself of this right, that Employee has carefully read and fully
understands all of the provisions of this Settlement Agreement and General
Release, and that Employee is voluntarily entering into this Settlement
Agreement and General Release.
9. Employee agrees not to engage in conduct or undertake speech derogatory
about, disparaging of or detrimental to the Company or any Company Releasee or
its reputation, its board of directors, officers, management, practices or
procedures, or business operations.
10. Employee agrees further that if any provision of this Agreement is held
by a court of competent jurisdiction to be unenforceable as a result of a claim,
demand or cause of action Employee has brought prior to the date on which
Employee has executed this Agreement, then the Company, at its option, will be
entitled to recover payments made to Employee, or on Employee's behalf, pursuant
to the Letter Agreement. Any such legal action by the Company shall not be
considered retaliatory.
11. Employee represents and acknowledges that Employee has carefully read
and fully understands all of the provisions of this Agreement, which sets forth
the entire agreement between the parties. Except for the Letter Agreement, and
the Employee Invention Assignment and Confidentiality Agreement of Employee with
the Company dated _____________, ______, [AS SUCH HAS BEEN AMENDED AND PARTIALLY
SUPERSEDED BY THE LETTER AGREEMENT], this Settlement Agreement and General
Release supersedes any and all prior agreements or understandings between the
parties and all corporate policies, practices or procedures pertaining to the
subject matter of this Agreement.
12. Employee understands that various federal, state and local laws
prohibit age, sex, race, disability, benefits, pension, health and other forms
of discrimination and that these laws can be enforced through the U.S. Equal
Employment Opportunity Commission, California state and local human rights
agencies and federal and state courts. Employee understands that if Employee
believes Employee's treatment by the Company or any Company Releasee was
discriminatory, Employee has had the right to consult with these agencies and to
file a charge with them or file a lawsuit. Employee has decided voluntarily to
enter into this Agreement, and waive the right to recover any amounts to which
Employee may have been entitled under such laws, including, but not limited to:
the Age Discrimination in
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Employment Act, 29 U.S.C. Section 621 et seq. (as amended by the Older Workers'
Benefit Protection Act, 29 U.S.C. Section 626(f)); the California Fair
Employment and Housing Act, California Government Code Section 12900 et seq.;
the Employee Retirement Income Security Act (ERISA), 29 U.S.C. Section 1001 et
seq.; Title VII of the Civil Rights Act of 1964, 42 U.S.C. Section 2000e et
seq.; the Americans with Disabilities Act, and 42 U.S.C. Section 1981. In
addition, this release covers all statutory, common law, constitutional and
other claims, including but not limited to, all claims for wrongful discharge in
violation of public policy, breach of contract, express or implied, breach of
covenant of good faith and fair dealing, intentional or negligent
misrepresentation, any tort, personal injury, or violation of law which Employee
may now have, or has ever had. The parties agree that any past or future claims
for money damages, loss of wages, earnings and benefits, both past and future,
medical expenses, attorneys' fees and costs, reinstatement and other equitable
relief, are all released by this Agreement. Accordingly, to the fullest extent
permitted by law, at no time subsequent to the execution of this Agreement will
Employee pursue, or cause or knowingly permit the prosecution, in any state,
federal or foreign court, or before any local, state, federal or foreign
administrative agency, or any other tribunal, any charge, claim or action of any
kind, nature and character whatsoever, known or unknown, which Employee may now
have, has ever had, or may in the future have against the Company and/or any
officer, director, employee or agent of the Company, which is based in whole or
in part on any matter covered by this Agreement.
13. Employee expressly waives any right or benefit available to him in any
capacity under the provisions of Section 1542 of the Civil Code of California,
which provides:
"A RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF
KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR."
14. Employee represents and acknowledges that Employee has not relied upon
any representations or statements, written or oral, not set forth in this
document.
15. Employee understands that Employee has twenty-one (21) days in which to
consider whether Employee should sign this Agreement; and that Employee further
understands that if Employee signs this Agreement, Employee will be given seven
(7) days following the date on which Employee signs this Agreement to revoke it
and that this Agreement will not be effective until after this seven (7) day
period had lapsed.
[THE REMAINDER OF THIS PAGE HAS INTENTIONALLY BEEN LEFT BLANK]
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16. This Settlement Agreement and General Release shall become effective on
the eighth (8th) day following the date it is signed by Employee. It is
understood that Employee may revoke Employee's approval of this Agreement in the
seven (7) day period following the date Employee signs this Agreement.
PLEASE READ CAREFULLY. THIS SETTLEMENT AGREEMENT AND GENERAL RELEASE
INCLUDES A RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS.
Executed at ______________, California, this ____ day of _____________, 20__.
----------------------------------------
Xxxx Xxxxxxxx
Executed at ______________, California, this ____ day of _________, 20__.
HNC SOFTWARE INC.
By:
------------------------------------
[name]
[title]
[SIGNATURE PAGE TO SETTLEMENT AGREEMENT AND GENERAL RELEASE]
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EXHIBIT "B"
LIMITED RELEASE
______, 20__
Xxxx Xxxxxxxx
[Officer's Address]
Re: Limited Release
Dear Xxxx:
HNC Software Inc. ("HNC") is executing and delivering this letter agreement
and limited release to you, Xxxx Xxxxxxxx ("YOU") pursuant to the provisions of
Section 8 of that certain letter agreement between You and HNC dated as of April
1, 2002 concerning terms of your employment with HNC (the "EMPLOYMENT LETTER
AGREEMENT"). This letter is the "Limited Release" referred to in the Letter
Agreement. HNC hereby agrees with You as follows
1. Subject to the terms and conditions of this letter, HNC releases and
discharges You and your heirs and successors (collectively referred to as the
"EMPLOYEE'S RELEASEES") from all claims, liabilities, demands and causes of
action known or unknown, fixed or contingent, which HNC has or may hereafter
have against You arising out of or in any way connected with Your employment
with HNC or the termination of Your employment with HNC; PROVIDED, HOWEVER, THAT
NOTWITHSTANDING THE FOREGOING, THE FOREGOING RELEASE AND DISCHARGE WILL NOT
RELEASE OR DISCHARGE YOU FROM ANY OF YOUR OBLIGATIONS, DEBTS, DUTIES OR
LIABILITIES TO HNC OR ANY OF ITS SUBSIDIARIES OR AFFILIATES OR THEIR SUCCESSORS
UNDER, OR ARISING FROM:
(a) the Employment Letter Agreement,
(b) Your Employee Invention Assignment and Confidentiality Agreement
with HNC, which You entered into upon becoming an HNC employee, as such was
amended by the Letter Agreement;
(c) the Settlement Agreement and General Release being entered into by
You and HNC concurrently herewith;
(d) any act or omission by You that constitutes or involves: (i) Your
fraud; (ii) Your criminal conduct with respect to HNC or any of its
subsidiaries, affiliates or successors (or any of their respective assets);
(iii) Your malfeasance or breach of fiduciary duty with respect to HNC or
any of its subsidiaries, affiliates or successors, or (iv) Your wrongful
disclosure, misuse or misappropriation of, or Your infringement of, any
confidential or proprietary information, technology, intellectual property
or any other asset or property of HNC or any of its subsidiaries,
affiliates or successors.
2. This Settlement and General Release shall not in any way be construed as
an admission by You or by any Employee Releasee that You have acted wrongfully
with respect to HNC or any other person, that HNC has acted wrongfully, or that
HNC has any rights whatsoever against You or any Employee Releasee. Rather, the
parties have entered into this release in order to lend greater certainty to the
existing state of affairs in exchange for the promises and considerations
herein.
Executed at ______________, California, this ____ day of _________, 20__.
By:
------------------------------------
Xxxx Xxxxxxxx
Executed at ______________, California, this ____ day of _________, 20__.
HNC SOFTWARE INC.
By:
------------------------------------
[name]
[title]
