1
EXHIBIT (c)(2)
to 14D-1
September 26, 1999
STRICTLY PERSONAL AND CONFIDENTIAL
Xx. Xxxx X. Xxxxxxxx
00 Xxxxxxxx Xxxxxx,
Xxxxx 00
Xxxxxx, Xxx.
X0X 0X0
Dear Xx. Xxxxxxxx:
RE: ADDENDUM TO CHANGE OF CONTROL
LETTER AGREEMENT
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We are writing to confirm the terms and conditions of your
employment in the event NetManage, Inc. acquires Simware Inc. You agree to
accept a position that is equivalent in status and compensation, including bonus
and stock options, to those of similar senior officers in NetManage, Inc.
divisions. Your base pay will be no less than your current base pay. NetManage,
Inc. divisional officers earn bonuses based on between 25 and 50% of base
salary.
As you know, you entered into an agreement with Simware Inc. dated
February 23, 1998 (the "Agreement") that governs your entitlement and
obligations in the event of a change in control which results in a change
affecting your employment. "Change of Control" is defined in the Agreement as
follows:
"CHANGE IN CONTROL" shall be deemed to have occurred on the first to happen of
the following:
(a) the completion of any offer, arrangement or transaction resulting,
directly or indirectly, in not less than fifty per cent (50%) of the
outstanding securities of Simware being acquired by a third party
purchaser;
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Xx. Xxxx X. Xxxxxxxx
September 26, 1999
(b) Simware sells or otherwise disposes of all or substantially all of its
assets, in which case the date of Change in Control shall be deemed to
be the date of closing of the first of a series of such transactions;
(c) the shareholders of Simware approve an amalgamation of Simware with any
other corporation or corporations (other than a short form
amalgamation), in which case the date of Change in Control shall be
deemed to be the date of which such amalgamation is effective;
(d) the Board of Directors of Simware adopts a resolution to the effect
that, for the purposes of this Agreement, a Change in Control has
occurred, in which case the date of Change in Control shall be deemed to
be the date of such resolution; or
(e) any other transaction which results in a third party acquiring control
of the shares or assets of Simware or board of directors.
"Change Affecting Your Employment" is defined in the Agreement as
follows:
"CHANGE AFFECTING YOUR EMPLOYMENT" means any of the following circumstances
which are not accepted by you during the 60-day period immediately following the
date on which you become aware of such circumstance:
(a) any change to your employment conditions which would significantly
reduce the nature of status or your responsibilities;
(b) the imposition by Simware of a requirement that you perform all or
substantially all of your duties of employment at a location which is 30
or more kilometres from the location at which you work as of the date of
this Agreement;
(c) a reduction by Simware in your annual compensation as of the date of the
Change in Control;
(d) the failure by Simware to continue in effect for your benefit any
perquisites or participation in any employee benefit plan to which other
employees of Simware are entitled, to the same extent to which other
employees enjoy such benefits; or
(e) any other change which would constitute "constructive dismissal" under
applicable law.
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Xx. Xxxx X. Xxxxxxxx
September 26, 1999
It is agreed that the acquisition of Simware Inc. by NetManage, Inc.
constitutes a "change of control" and may constitute a "change affecting your
employment" as defined by the Agreement. You may therefore be entitled to
payments under the Agreement. You have agreed, however, to waive your
entitlements under the Agreement in consideration of the total payment of
$599,200.00 Cdn, payable in 24 equal monthly instalments of $24,966.66 which
represents an amount equal to 24 months base salary and 12 months incentive
target (calculated at the rate of your incentive target for the current year).
The first payment will be made thirty (30) days after NetManage, Inc. becomes
the majority shareholder of Simware Inc.
If, during the 24 month payment period, you voluntarily terminate
your employment, or are terminated for cause, you will forfeit your entitlement
to any outstanding balance. In the event you are terminated without cause during
the 24 month payment period or there is a subsequent `change affecting your
employment', the payments will be accelerated such that the outstanding balance
will immediately become due and payable. You will not be entitled to any
payments in respect of notice and severance except as agreed between Xxx Xxxx
and yourself within the next 30 days.
The written provisions of this letter and the Employee Agreement as
to Confidential Information and Property Rights (appended) shall constitute the
full extent of the employment contract between Simware Inc., NetManage, Inc.,
and you, regardless of any oral or written agreements or understandings which
may presently exist. No waiver or modification of any provision of this letter
shall be valid unless in writing and duly executed by both Simware Inc. or
NetManage, Inc. and you.
This agreement may be executed in two or more counterparts and
signed by facsimile, each of which will be deemed to be an original but all of
which together shall constitute one of the same instrument.
You release all claims arising out of the acquisition of Simware
Inc. by NetManage, Inc. and out of your employment with Simware Inc. prior to
the effective date of this agreement, save and except any claims to accrued
salary, bonus, vacation and expenses.
Please sign below to acknowledge your agreement with these terms and
fax a signed copy to (000) 000-0000, attention X.X. Xxxxxxx. Please courier your
original signed letter to the offices of Xxxxxx Xxxxxxx, attention X.X. Xxxxxxx,
Suite 1600, 00 X'Xxxxxx Xxxxxx, Xxxxxx, X0X 0X0.
We look forward to working with you.
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Xx. Xxxx X. Xxxxxxxx; September 26, 1999
Yours very truly,
"Xxxx Xxxxxxxx"
Xxxx Xxxxxxxx
Senior Vice President and C.F.O.
The foregoing terms are acceptable.
Dated this 26th day of September, 1999.
SIGNED, SEALED AND DELIVERED )
IN THE PRESENCE OF )
)
)
)
)
"X. X. XXXXXXX" "XXXX X. XXXXXXXX"
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WITNESS XXXX X. XXXXXXXX
