EXECUTIVE EMPLOYMENT AGREEMENT - XXXXX XXXXXX
NEPTUNE SYSTEMS, INC.
EXECUTIVE EMPLOYMENT AGREEMENT
THIS EXECUTIVE EMPLOYMENT AGREEMENT is made as of the 18th day of
November, 1996 by and between Xxxxx X. Xxxxxx, a resident of Florida (the
"Employee"), and NEPTUNE SYSTEMS, INC., a corporation organized and existing
under the laws of the Commonwealth of Pennsylvania (the "Company").
WHEREAS, the Company is engaged in the business of providing supply
chain management software and related services to the warehouse, distribution
and logistics industries worldwide ("the Business"); and
WHEREAS, the Company desires to employ the Employee and the Employee
desires to be employed by the Company for a period of time in the future upon
the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual covenants and obligations
contained herein, and intending to be legally bound, the parties, subject to
the terms and conditions set forth herein, agree as follows:
1. EMPLOYMENT AND TERM.
(a) The Company hereby employs the Employee and the Employee
hereby accepts employment with the Company, as Senior Vice President and
Chief Operating Officer (the "Position"), for a period commencing as of the
date of letter of agreement between Xxxxxxx X. Xxxx ("President/CEO of the
Company") and the Employee dated November 18, 1996 ("the Commencement Date")
and commencing active employment as of January 1, 1997 and continuing until
December 31, 1999, subject to the provisions of Section 8 hereof (the
"Initial Term"). During the Initial Term, the Employee shall also be a member
of the Executive Committee appointed by the Board of Directors.
(b) At the end of the Initial Term, this Agreement shall
automatically renew for successive additional periods of one (1) year, unless
terminated by either party upon no less than one hundred eighty (180) days
prior written notice to the other party prior to the expiration of the
Initial Term or any such renewal period. The Initial Term of employment and
any renewal periods hereunder, subject to the provisions of Section 8 hereof,
are hereinafter referred to as the "Term."
2. DUTIES. During the Term, the Employee shall serve the Company
faithfully and to the best of his ability and shall devote his full time,
attention, skill and efforts to the performance of the duties required by or
appropriate for the Position. The Employee shall assume such duties and
responsibilities as may be customarily incident to such a position, and such
additional and other duties as may be assigned to the Employee from time to
time by the President or the Executive Committee of the Company, including,
without limitation, the duties and responsibilities set forth in SCHEDULE A
attached hereto. The Employee shall report to the President of the Company.
3. OTHER BUSINESS ACTIVITIES. During the Term, the Employee shall
not, without the prior written consent of the Company in its sole discretion,
directly or indirectly engage in any other business activities or pursuits
whatsoever, except activities in connection with charitable or civic
activities, personal investments and serving as an executor, trustee or in
other similar fiduciary capacity; provided that such activities do not
interfere with his performance of his responsibilities and obligations
pursuant to this Agreement.
EXECUTIVE EMPLOYMENT AGREEMENT - XXXXX XXXXXX
4. COMPENSATION. The Company shall pay the Employee, and the Employee
hereby agrees to accept, as compensation for all services rendered hereunder
and for the Employee's intellectual property covenants and assignments and
covenant not to compete as provided for in Sections 6 and 7 hereof, the
compensation set forth in this Section 4.
4.1 SALARY. The Company shall pay the Employee an initial
base salary at the annual rate of One Hundred Sixty Thousand Dollars
($160,000) (as the same may hereafter be increased , the "Base Salary"). The
Base Salary shall be inclusive of all applicable income, social security and
other taxes and charges that are required by law to be withheld by the
Company, are requested to be withheld by the Employee, and shall be withheld
and paid in accordance with the Company's normal payroll practice for its
similarly situated employees from time to time in effect. The Base Salary may
be increased from time to time by the Board of Directors of the Company in
its discretion.
4.2 BONUS PROGRAM. During the term of this Agreement and
within thirty (30) calendar days of the end of each business quarter as
defined by the Company the Employee shall receive an amount equal to two
percent (2%) of the Gross Margin booked for all new business in the North
American operations of the company. In addition the Employee shall receive a
like amount for all new business booked outside the North American for which
the Employee was directly responsible and managed and directed the
activities. For the purposes of clarity the Employee and Company shall put in
place a margin booking form acceptable to the both parties to aid in this
calculation. For purposes of this Section 4.2 "Gross Margin" shall mean
GROSS MARGIN CALCULATION SIMILAR TO HIS SYSTEMS TO BE DEVELOPED AND ATTACHED
TO THIS AGREEMENT.
4.3 EQUITY PARTICIPATION.
(a) The Company shall grant to the Employee an incentive
stock option to purchase three percent (3%) of the total shares of the Class
B (restricted voting and transfer rights) common stock of the Company equal
to 300,000 shares of common stock at a par value $.01 per share. The
Company plans to offer an additional 2,345,679 shares in two offerings to
private investors in early 1997. This grant will be adjusted on a pro-rata
basis to maintain the 3% ratio on outstanding shares. If the offering is
fully subscribed this will result in an additional 70,370 options being issue
to the Employee. There will be no dilution protection after this supplemental
grant. The Option shall vest as follows: 1/3 of the shares shall vest on the
Commencement Date of this Agreement, 1/3 shares shall vest on the first
anniversary of the Commencement Date of this Agreement, and 1/3 shall vest on
the second anniversary of the Commencement Date of this Agreement. The
exercise price of the Option shall be fixed at 75 cents ($.75) per share.
The Option shall be subject to and in accordance with the provisions of the
1996 Stock Option Plan of the Company (the "Plan") substantially in the form
attached hereto as SCHEDULE B however where this Agreement is different then
the language and provisions in this Agreement shall govern.
(b) Notwithstanding the foregoing, the Option shall
become fully vested upon the occurrence of one of the following events: (a)
the sale of the Company to an unrelated third party by way of merger, sale of
assets or sale of capital stock of the Company, (b) the sale by the Company
of more than seventeen percent (17%) of its outstanding Common Stock on a
fully-diluted basis to an unrelated third party (excluding any sales to
venture funds currently under consideration by the Company with whom
discussions began prior to the Commencement Date of this Agreement), or (c)
the filing by the Company of a registration statement on Form S-1 in
connection with an underwritten initial public offering.
(c) In addition to the foregoing Option, if the Company
completes an underwritten initial public offering of its Common Stock within
three (3) years from the date of this Agreement with an enjoys a market cap
of $200 million or more during it's first day of trading as a public company,
then the
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EXECUTIVE EMPLOYMENT AGREEMENT - XXXXX XXXXXX
Employee shall be entitled to receive an additional option for 200,000
Qualified Contingent on Attorneys Opinion shares of the Class B Common Stock
of the Company calculated on a like basis with the Option granted above in
paragraph 4.3(a) (the "IPO Option"). These options shall be granted on the
day after the Initial Public Offering and are fix priced at 75 cents ($.75)
per share.
(d) All shares of Common Stock issued under the Option
or the IPO Option shall be subject to the terms and provisions of a Stock
Purchase and Restriction Agreement as required by the Plan.
4.4 FRINGE BENEFITS. The Employee shall be entitled to
participate in any health, dental programs, or other fringe benefits
available to employees of the Company as amended from time to time. During
the Term, the Employee shall receive term life insurance in the amount of
$300,000 and disability insurance in the amount of $12,000 per month, which
premiums are to be paid by the Company. The Employee shall be entitled to
participate in all vacation and other fringe benefit programs of the Company
to the extent and on the same terms and conditions as are accorded to other
officers and key employees of the Company. Not withstanding the above, the
Employee is entitled to three (3) weeks' paid vacation per calendar year.
4.5 REIMBURSEMENT OF EXPENSES. The Employee shall be
reimbursed for all normal items of travel and entertainment and miscellaneous
expenses reasonably incurred by him on behalf of the Company, provided that
such expenses are documented and submitted to the Company all in accordance
with the reimbursement policies of the Company as in effect from time to
time. The Company shall pay to the Employee a car allowance of Seven Hundred
Fifty Dollars ($750) per month (the "Allowance") during the Term to help
defray the cost of acquiring, insuring and maintaining a vehicle. The Company
shall not be responsible for any cost or other obligation in connection with
such vehicle.
5. CONFIDENTIALITY. The Employee recognizes and acknowledges that the
Proprietary Information (as hereinafter defined) is a valuable, special and
unique asset of the Company. As a result, both during the Term and for a
period of three (3) years thereafter, the Employee shall not, without the
prior written consent of the Company, for any reason either directly or
indirectly divulge to any third-party or use for his own benefit, or for any
purpose other than the exclusive benefit of the Company, any confidential,
proprietary, business and technical information or trade secrets of the
Company or of any subsidiary or affiliate of the Company (the "Proprietary
Information") revealed, obtained or developed in the course of his employment
with the Company. Proprietary Information shall include, but shall not be
limited to: the intangible personal property described in Section 6(b)
hereof; any information relating to methods of production, manufacture and
research; hardware and software configurations, computer codes or
instructions (including source and object code listings, program logic
algorithms, subroutines, modules or other subparts of computer programs and
related documentation, including program notation), computer inputs and
outputs (regardless of the media on which stored or located) and computer
processing systems, techniques, designs, architecture, and interfaces; the
identities of, the Company's relationship with, the terms of contracts and
agreements with, the needs and requirements of, and the Company's course of
dealing with, the Company's actual and prospective customers, contractors and
suppliers; and any other materials prepared by the Employee in the course of
his employment by the Company, or prepared by any other employee or
contractor of the Company for the Company or its customers, (including
concepts, layouts, flow charts, specifications, know-bow, user or service
manuals, plans, sketches, blueprints, costs, business studies, business
procedures, finances, marketing data, methods, plans, personnel information,
customer and vendor credit information and any other materials that have not
been made available to the general public). Nothing contained herein shall
restrict the Employee's ability to make such disclosures during the course of
his employment as may be necessary or appropriate to the effective and
efficient discharge of the duties required by or appropriate for the Position
or as such disclosures may be required by law. Furthermore, nothing contained
herein shall restrict the Employee from divulging or using for his own
benefit or for any other purpose any Proprietary Information that is readily
available to the general public so long as such information did not become
available to the general public as a direct or indirect result of the
Employee's breach of this Section 5. Failure by the Company to xxxx any of
the Proprietary Information as confidential or proprietary shall not affect
its status as Proprietary Information under the
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EXECUTIVE EMPLOYMENT AGREEMENT - XXXXX XXXXXX
terms of this Agreement.
6. PROPERTY.
(a) All right, title and interest in and to Proprietary
Information shall be and remain the sole and exclusive property of the
Company. During the Term, the Employee shall not remove from the Company's
offices or premises any documents, records, notebooks, files, correspondence,
reports, memoranda or similar materials of or containing Proprietary
Information, or other materials or property of any kind belonging to the
Company unless necessary or appropriate in accordance with the duties and
responsibilities required by or appropriate for the Position and, in the
event that such materials or property are removed, all of the foregoing shall
be returned to their proper files or places of safekeeping as promptly as
possible after the removal shall serve its specific purpose. The Employee
shall not make, retain, remove and/or distribute any copies of any of the
foregoing for any reason whatsoever, except as may be necessary in the
discharge of the assigned duties, and shall not divulge to any third person
the nature of and/or contents of any of the foregoing or of any other oral or
written information to which he may have access or with which for any reason
he may become familiar, except as disclosure shall be necessary in the
performance of the duties; and upon the termination of his employment with
the Company, he shall return to the Company all originals and copies of the
foregoing then in the possession, whether prepared by the Employee or by
others.
(b) (i) The Employee acknowledges that all right, title and
interest in and to any and all writings, documents, inventions, discoveries,
computer programs or instructions (whether in source code, object code, or
any other form), algorithms, formulae, plans, memoranda, tests, research,
designs, innovations, systems, analyses, specifications, models, data,
diagrams, flow charts, and/or techniques (whether reduced to written or
electronic form or otherwise) that the Employee creates, makes, conceives,
discovers or develops, either solely or jointly with any other person, at any
time during the Term, whether during working hours or at the Company's
facility or at any other time or location, and whether upon the request or
suggestion of the Company or otherwise, and that relate to or are useful in
any way in connection with the Business as it exists on the Commencement Date
of this Agreement or hereafter carried on by the Company (collectively, the
"Intellectual Work Product") shall be the sole and exclusive property of the
Company. The Employee shall promptly disclose to the Company all Intellectual
Work Product, and the Employee shall have no claim for additional
compensation for the Intellectual Work Product.
(ii) From the Commencement Date of this Agreement until it's
termination the Employee acknowledges that all the Intellectual Work Product
that is copyrightable shall be considered a work made for hire under United
States Copyright Law. To the extent that any copyrightable Intellectual Work
Product may not be considered a work made for hire under the applicable
provisions of the United States Copyright Law, or to the extent that,
notwithstanding the foregoing provisions, the Employee may retain an interest
in any Intellectual Work Product that is not copyrightable, the Employee
hereby irrevocably assigns and transfers to the Company any and all right,
title, or interest that the Employee may have in the Intellectual Work
Product under copyright, patent, trade secret, trademark and other
intellectual property laws, in perpetuity or for the longest period otherwise
permitted by law, without the necessity of further consideration. The Company
shall be entitled to obtain and hold tn its own name all copyrights, patents,
trade secrets, and trademarks with respect thereto.
(iii) The Employee shall reveal promptly all information
relating to the Intellectual Work Product to an appropriate officer of the
Company, cooperate with the Company and execute such documents as may be
necessary or appropriate (A) in the event that the Company desires to seek
copyright, patent, trademark or other analogous protection thereafter
relating to the Intellectual Work Product, and when such protection is
obtained, renew and restore the same, or (B) to defend any opposition
proceedings in respect of obtaining and maintaining such copyright, patent,
trademark or other analogous protection.
(iv) In the event that the Company is unable after reasonable
effort to secure the Employee's signature on any of the documents referenced
in Section 7(b)(iii) hereof, whether because of the
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EXECUTIVE EMPLOYMENT AGREEMENT - XXXXX XXXXXX
Employee's physical or mental incapacity or for any other reason whatsoever,
the Employee hereby irrevocably designates and appoints the Company and its
duly authorized officers and agents as the Employee's agent and
attorney-in-fact, to act for and in his behalf and stead to execute and file
any such documents and to do all other lawfully permitted acts to further the
prosecution and issuance of any such copyright, patent, trademark or other
analogous protection with the same legal force and effect as if executed by
the Employee.
(v) The Employee represents that the innovations,
designs, systems, analyses, ideas for marketing programs, and all copyrights,
patents, trademarks and trade names, or similar intangible personal property
identified on SCHEDULE C hereof comprises all of the innovations, designs,
systems, analyses, ideas for marketing programs, and all copyrights, patents,
trademarks and trade names, or similar intangible personal property that the
Employee has made or conceived of prior to the date hereof, and same are
excluded from the operation of the other provisions of this Section 6(b).
7. COVENANT NOT TO COMPETE.
(a) The Employee shall not, anywhere in the world, during the
Term and for a period of two (2) years thereafter (the "Restricted Period"),
do any of the following directly or indirectly without the prior written
consent of the Company in its sole discretion:
(i) engage or participate, directly or indirectly, in
any business activity competitive with the Business or the business of any of
the Company's subsidiaries or affiliates as conducted as of the Commencement
date of this Agreement ("the Neptune Business");
(ii) become interested (as owner, proprietor, promoter,
stockholder, lender, partner, co-venturer, director, officer, employee,
agent, consultant or otherwise) in any person, firm, corporation, association
or or other entity engaged in any business that is competitive with the
Neptune Business except as existed on the Commencement Date of this
Agreement, or become interested in (as owner, stockholder, lender, partner,
co-venturer, director, officer, employee, agent, consultant or otherwise) any
portion of the business of any person, firm, corporation, association or
other entity where such portion of such business is competitive with the
Neptune Business (notwithstanding the foregoing, the Employee may hold not
more than five percent (5%) of the outstanding securities of any class of any
publicly-traded securities of a company that is engaged in the Neptune
Business.
(iii) solicit or call on, either directly or
indirectly in a capacity competitive with the Neptune Business, any (A)
customer with whom the Company shall have dealt at any time during the three
(3) year period immediately preceding the termination of the Employee's
employment hereunder, or (B) supplier or distributor with whom the Company
shall have dealt at any time during the three (3) year period immediately
preceding the termination of the Employee's employment hereunder;
(iv) influence or attempt to influence any supplier,
distributor, customer or potential customer of the Company to terminate or
modify any written or oral agreement or course of dealing with the Company; or
(v) influence or attempt to influence any person either
(A) to terminate or modify the employment, consulting, agency,
distributorship or other arrangement with the Company, or (B) to employ or
retain, or arrange to have any other person or entity employ or retain, any
person who has been employed or retained by the Company as an employee of the
Company at any time during the twelve (12) month period immediately preceding
the termination of the Employee's employment hereunder.
(b) The Employee hereby acknowledges that the limitations as
to time, character or nature and geographic scope placed on his subsequent
employment by this Section 7 are reasonable and fair and will
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EXECUTIVE EMPLOYMENT AGREEMENT - XXXXX XXXXXX
not prevent or materially impair his ability to earn a livelihood.
8. EARLY TERMINATION. The Employee's employment hereunder may be
terminated during the Term upon the occurrence of any one of the events
described in this Section 8. Upon termination, the Employee shall be entitled
only to such compensation and benefits as described in this Section 8.
8.1 TERMINATION FOR DISABILITY.
(a) In the event of the disability of the Employee such
that the Employee is unable to perform the duties and responsibilities
hereunder to the full extent required by this Agreement by reasons of
illness, injury or incapacity for a period of more than one hundred twenty
(120) consecutive days ("Disability"), the Employee's employment hereunder
may be terminated by the Company provided that such disability is not the
direct result of the Employee performing his duties on behalf of the company
or occurring while performing duties and functions on behalf of the Company
("Work Related Activities"). Should such disability be the direct result of
Work Related Activities then the Employee shall be entitled to compensation
under this Agreement to the extent of continuing health and disability
benefits.
(b) In the event of a termination of the Employee's
employment hereunder pursuant to Section 8.1(a), the Employee will be
entitled to receive all accrued and unpaid (as of the date of such
termination) Base Salary and other forms of compensation and benefits payable
or provided in accordance with the terms of any then existing compensation or
benefit plan or arrangement, including payment prescribed under and
disability of life insurance plan or arrangement in which he is a participant
or to which he is a party as an employee of the Company; provided that the
Employee has complied with all of his obligations under this Agreement and
continues to comply with all of his surviving obligations hereunder listed in
Section 10. Except as specifically set forth in this Section 8.1(b), the
Company shall have no liability or obligation to the Employee for
compensation or benefits hereunder by reason of such termination.
8.2 TERMINATION BY DEATH. In the event that the Employee dies
during the Term, the Employee's employment hereunder shall be terminated
thereby and the Company shall pay to the Employee's executors, legal
representatives or administrators an amount equal to: the accrued and unpaid
portion of the Base Salary and other compensation for the month in which he
dies. Except as specifically set forth in this Section 8.2, the Company shall
have no liability or obligation hereunder to the Employee's executors, legal
representatives, administrators, heirs or assigns or any other person
claiming under or through him by reason of the Employee's death, except that
the Employee's executors, legal representatives or administrators will be
entitled to receive the payment prescribed under any death or disability
benefits plan in which he is a participant as an employee of the Company, and
to exercise any rights afforded under any compensation or benefit plan then
in effect.
8.3 TERMINATION FOR CAUSE.
(a) The Company may terminate the Employee's employment
hereunder at any time for "cause" upon ninety (90) days' written notice to the
Employee. For purposes of this Agreement, "cause" shall mean:
(i) any material breach by the Employee of any of
his obligations under this Agreement;
(ii) willful failure by the Employee to perform
satisfactorily the duties required by or appropriate for the Position, as
determined by the President of the Company or the Board of Directors of the
Company in his or its sole reasonable discretion after 90 days written notice
to the employee of the deficiency in performance and development of a
mutually agreed plan to correct such performance shortfalls.
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EXECUTIVE EMPLOYMENT AGREEMENT - XXXXX XXXXXX
(iii) conduct of the Employee involving any type of
disloyalty to the Company or willful misconduct with respect to the Company,
including without limitation fraud, embezzlement, theft or proven dishonesty
in the course of the employment;
(iv) conviction of a felony or other criminal act
punishable by more than one (l) year in prison;
(v) commission by the Employee of an intentional tort or
an act involving moral turpitude or constituting fraud; or
(vi) habitual alcohol or substance abuse or addiction.
(b) In the event of a termination of the Employee's
employment hereunder pursuant to Section 8.3(a), the Employee shall be
entitled to receive all accrued but unpaid (as of the effective date of such
termination) Base Salary, benefits and bonuses. All Base Salary, benefits and
bonuses shall cease at the time of such termination, subject to the terms of
any benefit or compensation plan then in force and applicable to the Employee
as well as a release by the Company of any non-compete covenants contained
anywhere in this Agreement except those restrictions contained in paragraphs
7(a)(iii) and 7(a)(iv) and 7(a)(v). Except as specifically set forth in
this Section 8.3, the Company shall have no liability or obligation hereunder
by reason of such termination.
8.4 TERMINATION WITHOUT CAUSE.
(a) The Company may terminate the Employee's employment
hereunder at any time, for any reason, without cause, upon ninety (90) days'
written notice to the Employee except that such termination may not be
performed under the condition of acquisition, merger or sale of the company
without the full salary, benefits and stock options available under this
Agreement being given to the employee.
(b) In the event of a termination of the Employee's
employment hereunder pursuant to Section 8.4(a), the Employee shall be
entitled to receive all accrued but unpaid (as of the effective date of such
termination) Base Salary, benefits and bonuses, plus a liquidated termination
fee (the "Termination Fee") equal to the Employee's normal monthly salary at
the time of the termination times the number of months remaining on this
Agreement or One Hundred Sixty Thousand Dollars ($160,000) whichever is
greater. The payments of the Termination Fee will be made on a monthly basis
until the full amount is paid to the Employee. At the discretion of the
Employee he may waive the payment of Termination Fee for the right to
terminate any and all non-compete provisions of this Agreement in their
entirety no matter where they appear in this Agreement. All Base Salary,
benefits and bonuses shall cease at the time of such termination, subject to
the terms of any benefit or compensation plan then in force and applicable to
the Employee. Except as specifically set forth in this Section 8.4, the
Company shall have no liability or obligation hereunder by reason of such
termination.
8.5 OPTIONS; REPURCHASE OF SHARES.
Upon the termination of the Employee's employment pursuant to
this Section 8 for any reason, all further vesting on all stock options
and/or restricted stock in the Company held by the Employee shall immediately
cease as of such date and thereafter such stock options shall be exercisable
within two (2) calendar years and any restricted stock or other equity
securities held by the Employee shall be subject to repurchase by the Company
at an amount mutually agreed to and determined by an independent appraisal of
the worth of the company done by an outside party acceptable to both parties
to this Agreement. Should the Company file to have an Initial Public
Offerings within fifteen (15) calendar months of early termination of this
Agreement then the Company shall pay an additional amount to the Employee
equal to the difference between the amount already paid under this paragraph
and the share price in the Initial Public Offering.
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EXECUTIVE EMPLOYMENT AGREEMENT - XXXXX XXXXXX
9. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE EMPLOYEE.
(a) The Employee represents and warrants to the Company that:
(i) There are no restrictions, agreements or
understandings whatsoever to which the Employee is a party which would
prevent or make unlawful the Employee's execution of this Agreement or the
Employee's employment hereunder, or which is or would be inconsistent or in
conflict with this Agreement or the Employee's employment hereunder, or would
prevent, limit or impair in any way the performance by the Employee of the
obligations hereunder; and
(ii) The Employee has disclosed to the Company all
restraints, confidentiality commitments or other employment restrictions that
he has with any other employer, person or entity.
(b) Upon and after his termination or cessation of employment
with the Company and until such time as no obligations of the Employee to the
Company hereunder exist, the Employee (i) shall provide a complete copy of
this Agreement to any prospective employer or other person, entity or
association in the Business, with whom or which the Employee proposes to be
employed, affiliated, engaged, associated or to establish any business or
remunerative relationship prior to the commencement thereof and (ii) shall
notify the Company of the name and address of any such person, entity or
association prior to his employment, affiliation, engagement, association or
the establishment of any business or remunerative relationship.
10. SURVIVAL OF PROVISIONS. The provisions of this Agreement set
forth in Sections 5, 6, 7(a)(iii), 7(a)(iv), 7(a)(v), 8 and 9 through
20 hereof shall survive the termination of the Employee's employment
hereunder.
11. SUCCESSORS AND ASSIGNS. This Agreement shall inure to the
benefit of and be binding upon the Company and the Employee and their
respective successors, executors, administrators, heirs and/or permitted
assigns; provided that neither the Employee nor the Company may make any
assignments of this Agreement or any interest herein, by operation of law or
otherwise, without the prior written consent of the other parties hereto,
except that, without such consent, the Company may assign this Agreement to
any successor to all or substantially all of its assets and business by means
of liquidation, dissolution, merger, consolidation, transfer of assets, or
otherwise, provided that such successor assumes in writing all of the
obligations of the Company under this Agreement.
12. NOTICE. Any notice hereunder by either party shall be given by
personal delivery or by sending such notice by certified mail, return-receipt
requested, or by overnight delivery with a reputable courier service, or
telecopied, addressed or telecopied, as the case may be, to the other party
at its address set forth below or at such other address designated by notice
in the manner provided in this section. Such notice shall be deemed to have
been received upon the date of actual delivery if personally delivered or, in
the case of mailing, two (2) days after deposit with the U.S. mail, or if by
overnight delivery, the date of delivery or, in the case of facsimile
transmission, when confirmed by the facsimile machine report.
If to the Employee:
Xxxxx X. Xxxxxx
000 Xxxxxxxxx Xxxxx #000
Xxxxxx, Xxxxxxx 00000
If to the Company:
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EXECUTIVE EMPLOYMENT AGREEMENT - XXXXX XXXXXX
Neptune Systems, Inc.
000 Xxxxxxx Xxxxx Xxxxxxxxx
Xxxxxxxxx, XX 00000-0000
Attention: Xxxxxxx X. Xxxx
with a copy to:
Pepper, Xxxxxxxx & Xxxxxxx
0000 Xxxxxxxxx Xxxxx
Xxxxx 000
Xxxxxx,XX 00000
Attention: Xxxxxxxxxxx X. Xxxxxx, Esquire
13. ENTIRE AGREEMENT; AMENDMENTS. This Agreement contains the
entire agreement and understanding of the parties hereto relating to the
subject matter hereof, and merges and supersedes all prior and
contemporaneous discussions, agreements and understandings of every nature
between the parties hereto relating to the employment of the Employee with
the Company. This Agreement may not be changed or modified, except by an
agreement in writing signed by each of the parties hereto.
14. WAIVER. The waiver of the breach of any term or provision of
this Agreement shall not operate as or be construed to be a waiver of any
other or subsequent breach of this Agreement.
15. GOVERNING LAW. This Agreement shall be construed and enforced
in accordance with the laws of the Commonwealth of Pennsylvania, without
regard to the principles of conflicts of laws of any jurisdiction.
16. INVALIDITY. If any provision of this Agreement shall be
determined to be void, invalid, unenforceable or illegal for any reason, then
the validity and enforceability of all of the remaining provisions hereof
shall not be affected thereby. If any particular provision of this Agreement
shall be adjudicated to be invalid or unenforceable, then such provision
shall be deemed amended to delete therefrom the portion thus adjudicated to
be invalid or unenforceable, such amendment to apply only to the operation of
such provision in the particular jurisdiction in which such adjudication is
made; provided that, if any provision contained in this Agreement shall be
adjudicated to be invalid or unenforceable because such provision is held to
be excessively broad as to duration, geographic scope, activity or subject,
then such provision shall be deemed amended by limiting and reducing it so as
to be valid and enforceable to the maximum extent compatible with the
applicable laws of such jurisdiction, such amendment only to apply with
respect to the operation of such provision in the applicable jurisdiction in
which the adjudication is made.
17. SECTION HEADINGS. The section headings in this Agreement are
for convenience only; they form no part of this Agreement and shall not
affect its interpretation.
18. NUMBER OF DAYS. In computing the number of days for purposes
of this Agreement, all days shall be counted, including Saturdays, Sundays
and legal holidays; provided that, if the final day of any time period falls
on a Saturday, Sunday or day which is a legal holiday in Pennsylvania, then
such final day shall be deemed to be the next day which is not a Saturday,
Sunday or legal holiday.
19. SPECIFIC ENFORCEMENT; EXTENSION OF PERIOD.
(a) The Employee acknowledges that the restrictions contained
in Sections 5, 6, and 7 hereof are reasonable and necessary to protect the
legitimate interests of the Company and its affiliates and that the Company
would not have entered into this Agreement in the absence of such
restrictions. The Employee also acknowledges that any breach by him of
Sections 5, 6, or 7 hereof will cause continuing and irreparable injury to
the Company for which monetary damages would not be an adequate remedy. The
Employee shall not, in any
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EXECUTIVE EMPLOYMENT AGREEMENT - XXXXX XXXXXX
action or proceeding to enforce any of the provisions of this Agreement,
assert the claim or defense that an adequate remedy at law exists. In the
event of such breach by the Employee, the Company shall have the right to
enforce the provisions of Sections 5, 6, and 7 of this Agreement by seeking
injunctive or other relief in any court, and this Agreement shall not in any
way limit remedies of law or in equity otherwise available to the Company.
(b) The periods of time set forth in Sections 5, 6 and 7
hereof shall not include, and shall be deemed extended by, any time required
for litigation to enforce the relevant covenant periods, provided that the
Company is successful on the merits in any such litigation. The "time
required for litigation" is herein defined to mean the period of time
commencing on the earlier of the Employee's first breach of such covenants or
the service of process upon the Employee ending on the expiration of all
appeals related to such litigation.
20. CONSENT TO SUIT. In the case of any dispute under or in
connection with this Agreement, the Employee may only bring suit against the
Company in the Courts of the Commonwealth of Pennsylvania in and for the
County of Philadelphia or in the Federal District Court for such geographic
location. The Employee hereby consents to the jurisdiction and venue of the
courts of the Commonwealth of Pennsylvania in and for the County of
Philadelphia or the Federal District Court for such geographic location,
provided that such Federal Court has subject matter jurisdiction over such
dispute, and the Employee hereby waives any claim he may have at any time as
to FORUM NON CONVENIENS with respect to such venue. The Company shall have
the right to institute any legal action arising out of or relating to this
Agreement in any appropriate court and in any jurisdiction. Any judgment
entered against either of the parties in any proceeding hereunder may be
entered and enforced by any court of competent jurisdiction. If an action at
law or in equity is necessary to enforce or interpret the terms of this
Agreement, the prevailing party shall be entitled to recover, in addition to
any other relief, reasonable attorneys' fees, costs and disbursements.
21. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, and all of which
together shall be deemed to be one and the same instrument.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed as of the day and year first written above.
NEPTUNE SYSTEMS, INC.
By: /s/ Xxxxxxx Xxxx
----------------------------------
Title: PRESIDENT & CEO
/s/ Xxxxx X. Xxxxxx
----------------------------------
XXXXX X. XXXXXX
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EXECUTIVE EMPLOYMENT AGREEMENT - XXXXX XXXXXX
SCHEDULE A
DUTIES
The duties of the Employee shall include but not be limited to:
1. Directing the strategic sales and marketing operations of the Company;
2. Participating in the Executive Committee to formulate and execute
company policy
3. Providing direction to the Executive Committee on product direction.
4. Seeking out companies and products which are viable candidates for
acquisition or merger by the Company
5. Working with the President/CEO on day-to-day operations of the Company
6. Setting pricing policies for Company products and services
7. Reviewing, negotiating, and binding the Company in contracts and
agreement with customers
EXECUTIVE EMPLOYMENT AGREEMENT - XXXXX XXXXXX
SCHEDULE B
NEPTUNE SYSTEMS, INC.
1996 INCENTIVE AND QUALIFIED STOCK OPTION PLAN
[TO BE ATTACHED]
EXECUTIVE EMPLOYMENT AGREEMENT - XXXXX XXXXXX
SCHEDULE C
PRIOR INVENTIONS OF XXXXX X. XXXXXX
1. It is hereby disclosed that Xxxxx X. Xxxxxx and Xxxxxxxx X. Xxxxxx are
officers and owners of a corporate entity known as Manufacturing Technology
Associates, a State of Wisconsin corporation, and that further that company
owns and has marketed a MRPII Manufacturing Requirements Planning
System/Financial System known under the trade name PACS/FACS (Planning and
Control System/Financial Accounting Control System), and further that under a
previous corporate entity know as Manufacturing Resource Management the PACS
product was sold to Xxxxxx Xxxxxxxx and Company who sold the product to the
general public under the operations of Xxxxxxxx Consulting with the trade
name MACPAC, and further that PACS/FACS is a copyrighted work containing
substantial amounts of inventory control, stock location, and distribution
logic which can operate on the IBM AS/400, HP/9000 and IBM RS/6000 family of
computers Xxxxx X. Xxxxxx is a key designer and architect of the logic
contained in this system.
NEPTUNE SYSTEMS, INC.
FIRST AMENDMENT TO EXECUTIVE EMPLOYMENT AGREEMENT
This First Amendment (this "Amendment") is dated September 11, 1997 by
and between Xxxxx X. Xxxxxx (the "Employee") and Neptune Systems, Inc. (the
"Company") and amends the Executive Employment Agreement dated as of November
18, 1996 between the Employee and the Company (the "Agreement").
WHEREAS, the Employee and the Company entered into the Agreement
pursuant to which the Employee was granted and was to be granted certain
incentive stock options in the Company;
WHEREAS, the Company is currently in negotiations with Dallas Systems
Corporation, General Atlantic Partners and EXE Technologies, Inc. with
respect to the merger of both the Company and Dallas with and into EXE
Technologies (the "Merger"); and
WHEREAS, the parties desire to amend the Agreement regarding the option
grants and to clarify the Agreement regarding the impact of the Merger.
NOW, THEREFORE, in consideration of the mutual covenants set forth
herein and intending to be legally bound hereby, the parties agree as follows:
1. DEFINITIONS. All capitalized terms used in this Amendment shall
have the same meaning as those contained in the Agreement unless otherwise
defined herein.
2. RECEIPT OF INITIAL OPTION. The Employee acknowledges that as stated
in Section 4.3(a) of the Agreement the employee was granted an Incentive
Stock Option (the "Initial Option") dated November 18, 1996, to purchase
300,000 shares of the Class B Common Stock, $.001 par value per share, of the
Company at the fair market value of 75 cents ($.75) per share.
3. ACCELERATION OF VESTING. The Company acknowledges that upon the
consummation of the Merger, the Initial Option will become fully vested
pursuant to Section 4.3(b) of the Agreement and that as of the date on which
the Merger is effective the Employee may upon demand execute any or all of
the options at anytime time the Employee desires.
4. THE SECOND OPTION GRANT. Promptly after the consummation of the
Merger, the successor in interest to the Company as a result of the Merger
(the "Surviving Corporation") shall grant to the Employee an incentive stock
option (the "Second Option") to purchase 39,583 total shares of the Class B
Common Stock, $.01 par value per share, of the Surviving Corporation. The
exercise price of the Second Option shall be fixed at a fare market price of
Two Dollars ($2.00) per share. The Second Option shall be fully vested on the
date of issuance of the Second Option. The Second Option shall be subject to
and in accordance with provisions of the 1996 Stock Option Plan of the
Company or any successor Plan adopted by the Surviving Corporation (the
"Plan"), provided that if this Amendment or the Agreement conflicts with the
language and provisions in the Plan, then the Agreement as amended shall
govern. The Employee acknowledges that upon the issuance of the Second
Option, the Company has no further obligation to issue any additional options
to the Employee pursuant to Section 4.3(a) of the Agreement.
5. TERMINATION OF 4.3(c). The parties acknowledge that notwithstanding
anything to the contrary contained in the Agreement, Section 4.3(c) of the
Agreement is hereby terminated in its entirety.
6. THE THIRD OPTION GRANT. Promptly after the consummation of the
Merger, the Surviving Corporation shall grant to the Employee an incentive
stock option (the "Third Option") to purchase 200,000 shares of the Class B
Common Stock, $.01 par value per share, of the Surviving Corporation. The
exercise price of the Third Option shall be at the fair market value of Two
Dollars ($2.00) per share. The Third Option shall vest as follows: 10,417 of
the shares shall vest on [January 1], 1999; 66,667 of the shares shall vest
on [January 1], 2000; 66,667 of the shares shall vest on [January 1], 2001;
and 58,250 of the shares shall vest on [January 1], 2002. The Third Option
shall be subject to and in accordance with the provisions of the Plan,
provided that if this Amendment or the Agreement conflicts with the language
and provisions in the Plan, then the Agreement as amended shall govern.
7. EFFECT OF MERGER. The parties acknowledge that upon the
consummation of the Merger, the Agreement shall be binding upon each of the
Employee and the Surviving Corporation as a result of the Merger.
8. MISCELLANEOUS.
(a) The Agreement shall remain in full force and effect, subject
only to the changes herein specified.
(b) The Agreement, as modified by this Amendment, constitutes the
entire understanding between the parties with respect to the subject matter
hereof and supersedes any prior understandings and/or written or oral
agreements between them.
(c) All references to the Agreement in any other documents, shall
mean the Agreement as amended hereby and from time to time hereafter in
writing.
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(d) This Amendment shall be governed by the laws of the
Commonwealth of Pennsylvania, without regard to the principles of conflicts
of laws of any jurisdiction.
IN WITNESS WHEREOF, the parties have executed this Amendment on the date
first above written.
NEPTUNE SYSTEMS, INC.
/s/ Xxxxx X. Xxxxxx
-------------------------- By: /s/ Xxxxxxx Xxxx
XXXXX X. XXXXXX ---------------------------------
Title: President
---------------------------
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