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Exhibit 10.23
EMPLOYMENT AND NONCOMPETITION AGREEMENT
EMPLOYMENT AND NONCOMPETITION AGREEMENT ("Agreement"),
effective as of April 1, 1994, between T. Wallace Wrathall
("Employee") and Comshare, Incorporated ("Employer").
W I T N E S S E T H:
WHEREAS, Employee has been serving in the position of
Group Vice President - Finance and Administration pursuant to an
employment agreement between Employee and the Corporation dated
October 15, 1985, as amended September 8, 1990 ("Prior
Agreement"); and
WHEREAS, Employer wishes to employ Employee as
President and Chief Executive Officer upon the terms and
conditions set forth in this Agreement, and Employee wishes to
accept employment under such terms;
NOW, THEREFORE, in consideration of the mutual
covenants and agreements set forth herein, the parties hereby
agree as follows:
1. Employment Period.
(a) Employer hereby agrees to employ Employee,
and Employee hereby accepts employment from Employer for a term
commencing on April 1, 1994 ("Effective Date") and ending four
(4) years from the Effective Date; provided, however, that (i)
upon the first anniversary of this Agreement and upon each
succeeding anniversary thereof, the term shall be deemed
automatically extended for one additional year ("Employment
Period") unless on or prior to a date sixty (60) days
immediately preceding such anniversary either the Employee or
the Board of Directors of the Employer determines not to extend
such term; (ii) if at any time this Agreement is terminated by
the Employer other than for cause (as defined in (b), below),
Employee shall be entitled to receive the payments set forth in
Section 8 hereof; and (iii) the Employment Period shall cease
upon Employee's death, disability (as defined in Section 7), or
retirement on or after age 65; subject, however, to Employee's
rights under this Agreement and any employee benefit plan of the
Employer, whether or not insured, then maintained for the
benefit of salaried employees.
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(b) Termination of Employee by the Employer shall
be deemed to be "for cause" if Employee is dismissed for
dishonesty or conviction of a felony or for a material default
in his performance of obligations under this Agreement after
Employee's receipt of written notice from the Board of Directors
describing the default and Employee's failure to remedy such
default within sixty (60) days after receipt of such notice.
2. Replacement of Prior Agreement. This Agreement
replaces and supercedes the Prior Agreement in its entirety;
with the exception of Section 10 of the Prior Agreement, which
is carried over and continued as Section 10 herein.
3. Services.
(a) During the Employment Period, Employee shall
serve Employer as President and Chief Executive Officer of
Employer and, accordingly, shall have primary responsibility for
the day-to-day business operations of Employer. Employee's
responsibilities shall be consistent with his position,
including those prescribed in the Bylaws of the Employer.
Employee shall assume such additional responsibilities as may be
reasonably required or assigned by the Board of Directors of the
Employer, except that the performance of any additional
responsibilities shall not require Employee to change his
residence from Ann Arbor, Michigan unless first consented to by
Employee, and such additional responsibilities shall be
consistent with Employee's position of President and Chief
Executive Officer of the Employer. For purposes of this
Agreement, the term "Employer" shall mean any corporate or other
successor to all or substantially all of the business and
properties of the Employer. Notwithstanding the foregoing,
Employee understands and agrees that in the performance of his
duties he shall at all times be subject to the control and
supervision of the Board of Directors of Employer.
(b) If, in addition to the position of President
and Chief Executive Officer, Employee serves as a director of
the Employer, or as a member of any committee of the Board of
Directors, or as an officer or a director of a subsidiary of the
Employer, Employee shall receive no additional compensation for
such service.
(c) During the Employment Period, Employee shall
devote substantially his full business time and effort to the
performance of his responsibilities for the Employer. His
services to the Employer shall be rendered to the best of his
ability and with loyalty to the Employer. He shall not during
the term of his employment, without the prior approval of the
Board of Directors, agree to render or render any service to any
person, firm or corporation other than the Employer, except
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for services for philanthropic, social, educational or community
organizations outside of regular business hours, nor will
Employee have any position or interest, directly or indirectly,
in any organization which is competitive with any business then
actively conducted by the Employer other than the ownership of
not more than two (2%) percent of the outstanding stock of a
corporation whose stock is held of record by more than 500
stockholders and is listed on a national securities exchange or
is actively traded in the over-the-counter market.
4. Salary, Bonus and Benefits.
(a) Employer shall pay Employee an annual base
salary of $300,000, payable in equal, bi-weekly installments,
with increases subject to annual review by the Compensation
Committee. The Compensation Committee shall recommend any base
salary increases to the Board of Directors for final
confirmation. Employee's base salary, as adjusted from time to
time, shall not be decreased unless it is part of a compensation
reduction program promulgated in response to adverse business or
financial conditions and applicable, in similar proportionate
amounts, to senior executives of the Employer in general.
(b) In addition to the Base Salary payable to
Employee pursuant to Section 4(a), Employee shall be eligible to
participate in the health insurance, disability insurance and
other health and welfare benefit programs and employee stock
ownership, profit sharing and incentive programs of the Employer
offered to other senior executives of the Employer. Employee's
participation in any incentive compensation program of the
Employer shall be at a level appropriate for a Chief Executive
Officer, and his share of incentive compensation, by dollar
amount and percentage, shall increase not less than
proportionately with any other senior executive of the Employer.
5. Business Expenses. The Employer shall pay or
reimburse Employee promptly, upon presentation of appropriate
vouchers, for all travel, business and entertainment expenses
reasonably incurred by Employee in connection with the business
of the Employer. Employee shall submit to the Employer periodic
reports of such expenses and other disbursements not less often
than once each calendar month. In addition, to the extent
provided to other senior executives, during the Employment
Period, the Employer shall provide Employee with the use of an
automobile, and reimburse Employee for car related expenses in
accordance with policies of the Employer as in effect from time
to time.
6. Vacations. Employee shall be entitled to
reasonable vacations each year in accordance with the policies
of the Employer in effect for salaried personnel at such time.
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7. Disability. If Employee becomes physically or
mentally unable to perform his duties under this Agreement, as
determined by resolution of the Board of Directors (which shall
be based upon certified reports following a thorough examination
by at least two qualified medical experts, one of whom shall be
Employee's personal physician) and such capacity continues for a
period of twelve (12) consecutive calendar months, then
Employee's salary hereunder may be suspended by the Employer
upon written notice to Employee to such effect, until such time
as the Board of Directors determines by resolution (which may be
based upon certified reports submitted following re-examination
by the qualified medical experts selected by the Employer) that
such physical or mental incapacity no longer exists and Employee
is able to resume performance of such duties.
If Employee's salary is suspended during any year or
portion thereof with respect to which incentive compensation is
payable, then such incentive compensation, if any, shall be due
for only that part of such year during which such suspension is
not in effect.
In the event Employee's salary is suspended pursuant to
this Section 7, Employee shall be entitled to receive disability
payments from the effective date of such suspension under any
employee benefit plan, whether or not insured, then maintained
by the Employer for the benefit of salaried employees.
8. Termination Upon Material Breach by Employer.
(a) Upon the occurrence of a material breach of
this Agreement by the Employer, including the Employer's
termination of Employee for any reason except cause, as defined
in Section 1(b), or upon any substantial change in Employee's
title, responsibilities or location inconsistent with Section 3
hereof, Employee shall have the right to terminate this
Agreement by giving the Employer written notice, within thirty
(30) days following the occurrence of such material breach. In
the event of such election, Employee shall have no further
obligations under this Agreement other than pursuant to Sections
8(b), 11, 12 and 13 and shall be entitled to receive (in
addition to any amounts then payable as incentive compensation)
liquidated damages equal in amount to the salary Employee
otherwise would be entitled to receive pursuant to the
provisions of Section 4(a) hereof for a period of three (3)
years immediately following the date of such termination but in
no event longer than the then unexpired term of this Agreement,
payable in installments as provided in Section 4(a).
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(b) If, however, at any time after one (1) year
from such termination and within such three (3) year liquidated
damages period, referenced in Section 8(a), Employee obtains
other employment as an executive officer of a corporation or an
equivalent position with a non-incorporated entity, each payment
to Employee of liquidated damages shall be reduced by an amount
(but not to exceed one-half (1/2) of such payment) equal to the
amount of Employee's compensation for such period with respect
to such other employment. Employee shall promptly notify the
Employer of the amount of his compensation from such other
employment if he obtains other employment.
9. Termination Following Change of Control.
(a) Employee agrees not to terminate his
employment and to retain his duties under this Agreement with
the Employer (including the duties as Chief Executive Officer of
a separate, independent corporation; i.e., not a division of a
successor corporation) for a period of twelve (12) months
following a change in control (as defined in (d) below) of the
Employer. At the end of the twelve (12) month period, Employee
may voluntarily terminate his employment under this Agreement
and receive the compensation and benefits that he would have
received under Section 8, as if the Employer had committed a
material breach under the Agreement. Provided, however, that
the mitigation provisions in Section 8(b) shall still apply, and
Employee shall not be entitled to any payment under this Section
9 if Employee already is entitled to payments under Section 8.
(b) In the event that (i) Employee is
involuntarily terminated by the Employer or its successor for
any reason other than cause (as defined in 1(b)) during the
twelve (12) month period following a change in control, or (ii)
Employee terminates for "good reason" (as defined in (c) below)
within twelve (12) months following a change in control of the
Employer, Employee shall have the right to terminate this
Agreement, in the same manner, and with the same effect, as
provided in Section 8 hereof with respect to termination by
Employee following a material breach of this Agreement by the
Employer, including the right to receive the payments provided
by Section 8. Notwithstanding the foregoing, the mitigation
provisions of Section 8(b) shall apply to any payments due
Employee under this Section 9, and Employee shall not be
entitled to payment under Section 9 if already entitled to
payment under Section 8.
(c) The Employee may terminate employment for
"good reason" during the twelve (12) month period immediately
following a change in control after the occurrence of any of the
following events during such twelve (12) month period:
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(i) if, following a change in control,
there is any diminution in the Employee's position, duties,
responsibilities and status with the Employer as in effect
immediately prior to the change in control (including the change
of his title and responsibilities to anything less than Chief
Executive Officer of a separate, independent corporation; i.e.,
not a division of a successor corporation), or there is a
significant adverse alteration in the Employee's reporting
responsibilities, titles, or offices from those in effect
immediately prior to the change in control, or if the Employee
is removed from his position, except due to a promotion or in
connection with the termination of the Employee's employment for
cause, or by the Employee other than for good reason;
(ii) if, following a change in control, the
Employer reduces the Employee's base salary in effect
immediately prior to the change in control, or the Employer
fails to continue any bonus plans in which the Employee
participated immediately prior to the change in control without
the substitution of a comparable replacement plan, or the
Employer fails to continue the Employee's participation in such
bonus (or comparable) plans on at least the same basis as in
effect immediately prior to the change in control;
(iii) if, following a change in control, the
Employer fails to continue in effect (and without substitution
of a comparable plan) any benefit or compensation plan, stock
purchase plan, stock option plan, life insurance plan, health
and hospitalization plan or disability plan in which the
Employee participated immediately prior to the change in
control, or the taking of any action by the Employer that would
adversely affect the Employee's participation in or materially
reduce the Employee's benefits under any of such plans (or
replacement plans);
(iv) if the Employer materially breaches
any provision of this Agreement;
(v) if the Employer fails to obtain a
satisfactory agreement from any successor to assume and perform
this Agreement, as contemplated in Section 14 hereof.
If the Employee believes that he is entitled to terminate his
employment with the Employer for Good Reason, he may apply in
writing to the Board of Directors for confirmation of such
entitlement prior to the Employee's actual separation from
employment. The submission of such a request by the Employee
shall not constitute "cause" for the Employer to terminate the
Employee under Section 1(b) hereof. If the Employee's request
for a termination of employment for good reason is denied, then
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the parties may proceed to court pursuant to Section 13 hereof,
and both parties shall use their best efforts in good faith to
resolve the claim as quickly as possible.
(d) For purposes of this Agreement, a change in
control shall be defined as:
(i) the election of a Board of Directors
of the Employer, a majority of the members of which were
nominees of a person (including an individual, a corporation,
partnership, joint venture, trust or other entity) or a group of
persons acting together (other than the Weyerhaeuser Family, as
designated in the Employer's proxy statement or persons who were
members of the Board of Directors or officers of the Employer as
of the 1994 annual meeting of shareholders, or an employee stock
ownership plan approved by a majority of such members of the
Board of Directors), following the acquisition by such person,
group of persons or plan of ownership (directly or indirectly,
beneficially or of record) of twenty-five (25%) percent, or
more, of the outstanding common stock of the Employer;
(ii) the acquisition of ownership by a
person or group of persons described in subparagraph (a) above
of fifty-one (51%) percent, or more, of the outstanding common
stock of the Employer;
(iii) a sale of all or substantially all of
the assets of the Employer to any entity not controlled by the
Weyerhaeuser Family or by persons who were members of the Board
of Directors or officers of the Employer as of the 1994 annual
meeting of shareholders, or by any employee stock ownership plan
for the benefit of employees of the Employer; or
(iv) a merger, consolidation or similar
transaction between the Employer and another entity if a
majority of the members of the Board of Directors of the
surviving company are not Continuing Directors. The term
"Continuing Directors" means persons (i) who are members of the
Board of Directors of the Employer immediately before the change
in control and (ii) who also were members of the Board of
Directors of the Employer immediately following the 1994 annual
meeting of shareholders or are new directors whose election by
the Board of Directors, or nomination for election by the
Employer's shareholders, was approved by a vote of at least a
majority of the directors in office at the time of such election
or nomination who either were directors immediately following
the 1994 annual meeting of shareholders or whose election or
nomination for election was previously approved as provided
above.
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10. Payment for Stock Options Upon Termination. In
the event of termination of this Agreement pursuant to either
Sections 8 or 9 of this Agreement, Employee may elect, within 30
days of his termination, to surrender to the Employer some or
all of his outstanding stock options that were granted prior to
August 1, 1994 and are then held by Employee, whether or not
then exercisable by their terms, and, upon such surrender, the
Employer shall pay Employee in cash for each share subject to
such options an amount equal to the difference between the per
share exercise price of the shares subject to such options and
the per share closing price of the Employer's outstanding stock
on the effective date of such termination, as shown by the
NASDAQ National Market System quotations or the transactions on
any stock exchange on which such stock may then be listed or, if
higher, the average price per share paid in cash in connection
with any change of control transaction described in Section 9
or, if applicable, the per share fair market value of any other
consideration given incident to any such transaction.
11. Confidential Information. The Employee agrees
that for and during the term of his employment with Employer and
for five (5) years thereafter, any data, figures, projections,
estimates, customer lists, tax records, personnel histories and
records, information regarding manufacturing processes or
techniques, information regarding sales, information regarding
properties and any other information regarding the business,
operations, properties or personnel of Employer (collectively
referred to herein as "Confidential Information") disclosed to
or learned by the Employee shall be held in confidence and
treated as proprietary to Employer, and the Employee agrees not
to use or disclose any Confidential Information except to
promote and advance the business interests of Employer.
Further, upon termination of this Agreement for any reason, the
Employee agrees that he shall continue to treat such
Confidential Information as private and privileged and shall not
use for his own benefit or for the benefit of any other person
or entity, Confidential Information except upon the written
authorization of Employer, and he will immediately return to the
Employer and refrain from taking or copying any documents
containing Confidential Information. The Employee agrees that
the Employer shall be entitled to immediate (i.e., without prior
notice) preliminary and final injunctive relief to enjoin and
restrain the unauthorized disclosure or use of Confidential
Information, to enjoin and restrain him from the unauthorized
taking or copying of documents containing Confidential
Information or to compel his to return any such documents to
Employer.
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12. Noncompetition.
(a) For a period of two (2) years or such period
for which the Employee continues to receive compensation from
the Employer following his termination of employment, whichever
period is longer, Employee shall not compete with the Employer
or invest in, own, operate, manage or consult with, become an
employee, agent, representative, independent contractor,
partner, co-venturer, officer, consultant or director of, or act
on behalf of, or perform services for, any individual or
component of a direct competitor of the Employer anywhere in the
world (subject to Employee's receipt of a waiver from the
Employer, as set forth in paragraph (b), below). At the time of
Employee's termination of employment, the Employer, in good
faith, shall prepare a list of the Employer's direct competitors
during the twelve (12) month period immediately preceding the
Employee's date of termination. For purposes of preparing such
list, the term "direct competitor" shall mean an individual or
organization offering one or a combination of packaged software
application products for executive information systems,
statutory financial consolidation, enterprise budgeting and
merchandise planning for soft goods retailers, plus such other
areas of applications that the Employer may have added (or minus
such areas of applications that the Employer may have dropped)
as of the date on which the Employee terminates employment with
the Employer.
(b) Notwithstanding the foregoing, with the
written consent of the Board of Directors of the Employer (which
consent shall not be unreasonably withheld), and during the
noncompetitive period of this Section 12, Employee may obtain a
waiver to work with a non-competitive component of a direct
competitor. The Employer's Board of Directors shall consider
such request in good faith and promptly respond to the Employee.
The ownership by the Employee of less than 2% of the outstanding
stock of an employer traded on a national securities exchange or
quoted on the NASDAQ National Market System and having more than
1,000 shareholders shall not be a violation of this Section 12.
13. Disputes. It is mutually agreed between the
parties that any dispute, claim or controversy involving the
interpretation of this Agreement or the terms, conditions or
termination of this Agreement or the terms, conditions or
termination of Employee's services with Employer shall be
resolved by a court of competent jurisdiction. Both parties
agree to act timely and in good faith to resolve any disputes
hereunder. Each party shall be responsible for his or its
respective legal fees, including court costs and attorneys fees.
14. Successors and Assigns. This Agreement shall be
binding upon and inure to the benefit of Employer and its
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affiliates, successors and assigns, and shall be binding upon
and inure to the benefit of Employee and his legal
representatives and assigns, provided that in no event shall
Employee's obligations to perform future services for Employer
and its affiliates be delegated or transferred by Employee.
Employer may assign or transfer its rights hereunder to any of
its affiliates or to a successor Employer in the event of
merger, consolidation, or transfer or sale of a majority of the
shares of the capital stock of Employer or all or substantially
all of the assets of Employer, provided that such affiliate or
successor Employer acknowledges to Employee in writing its
duties and obligations to Employee hereunder on or before the
date of effectiveness of such assignment or transfer.
15. Modification or Waiver. No amendment,
modification or waiver of this Agreement shall be binding or
effective for any purpose unless it is made in a writing signed
by the party against whom enforcement of such amendment,
modification or waiver is sought. No course of dealing between
the parties to this Agreement shall be deemed to affect or to
modify, amend or discharge any provision or term of this
Agreement. No delay on the part of Employer or Employee in the
exercise of any of their respective rights or remedies shall
operate as a waiver thereof, and no single or partial exercise
by Employer or Employee of any such right or remedy shall
preclude other or future exercise thereof. A waiver of right or
remedy on any one occasion shall not be construed as a bar to or
waiver of any such right or remedy on any other occasion.
16. Governing Law. This Agreement and all rights,
remedies and obligations hereunder, including, but not limited
to, matters of construction, validity and performance shall be
governed by the laws of the State of Michigan.
17. Severability. Whenever possible each provision
and term of this Agreement shall be interpreted in such manner
as to be effective and valid under applicable law, but if any
provision or term of this Agreement shall be held to be
prohibited by or invalid under such applicable law, then such
provision or term shall be ineffective only to the extent of
such prohibition or invalidity, without invalidating or
affecting in any manner whatsoever the remainder of such
provision or term or the remaining provisions or terms of this
Agreement.
18. Counterparts. This Agreement may be executed in
separate counterparts each of which is deemed to be an original
and all of which taken together constitute one and the same
Agreement.
19. Headings. The headings of the paragraphs of this
Agreement are inserted for convenience only and shall not affect
the construction or interpretation of this Agreement.
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20. No Strict Construction. The language used in this
Agreement shall be deemed to be the language chosen by the
parties hereto to express their mutual intent, and no rule of
strict construction shall be applied against any person.
IN WITNESS WHEREOF, the undersigned have executed this
Agreement as of the date first above written.
COMSHARE, INCORPORATED
By:/S/ Daniel T. Carroll
Daniel T. Carroll
Chairman of the Compensation
Committee
/S/ T. Wallace Wrathall
T. Wallace Wrathall, Employee