EXCALIBUR TECHNOLOGIES
2000 Corporate Ridge Suite 1095 McLean, VA 22102
Tel (703)790-2110 FAX (703)790-2111
September 7, 1995
James Buchanan
236 Meadowbrook Drive
Cranberry Township, PA 16066
Dear James,
It is my pleasure to offer you the position of Chief Financial Officer for
Excalibur Technologies Corporation. As agreed upon, your start date will be
September 13, 1995 and your place of employment will be 2000 Corporate Ridge in
McLean, Virginia.
Alon with this letter, I am enclosing two copies of Excalibur's standard
Confidentiality Agreement. Please sign and return both copies of the agreement
to me prior to commencement of your employment. A fully executed copy will be
returned to you for your records.
Your compensation will be as follows:
Salary
$150.000 annual salary, paid semi-monthly.
Revenue Attainment Bonus
A potential pro-rated bonus of $15,000, evaluated and paid quarterly,
based on Excalibur meeting its FY96 corporate revenue budget each quarter,
as approved or modified by the Board of Directors.
Profitability Bonus
A potential pro-rated bonus of $15,000, evaluated and paid after the final
financial figures for FY96 are known, based on Excalibur achieving
profitability for the second half of FY96, as reported on the Net Profit
line on Excalibur's financial statements, but not including this bonus or
similar bonuses paid to other executives of Excalibur.
Performance Bonus
A potential pro-rated bonus of $7,500, evaluated and paid at the end of
FY96, based on a subjective evaluation of your performance during FY96 by
Excalibur's Board of Directors.
James Buchanan
September 7, 1995
Page 2
Stock Options
Upon start of your employment you will be granted options under the
Excalibur Incentive Plan to purchase 30,000 shares of Excalibur stock.
An additional grant of 30,000 shares of Excalibur stock will be granted
upon the first anniversary of your employment.
An additional grant of 40,000 shares of Excalibur stock will be granted
upon your second anniversary of employment bringing the total shares of
stock granted to 100,000.
Such grants are made at the market price at the time of grant (average of
closing price of stock for the ten trading days preceding the date of
grant), and vest 12.5% every six months.
The options are subject to the rules and requirements of the Excalibur
Incentive Plan, the IRS Code, and any changes made by a a third party
which may effect the issuance of or accounting for these options by the
Company. This clause is valid as long as you are employed by Excalibur
and are not released for cause.
Relocation Bonus
At the time you relocate your personal residence to the McLean, Virginia
area, you will be paid a relocation bonus of $50,000 (before taxes are
deducted). If you resign from Excalibur, or are terminated for cause
(definition of "cause" attached), anytime within the first two years of
employment, you agree to repay a pro-rated amount of the net after-tax
Relocation Bonus you receive.
Discharge of Employee
Should you be let from Excalibur for any reason other than cause you will
receive an amount equal to 12 months compensation of your annual salary
upon the date of your discharge. You will be paid the foregoing amount
periodically, as though you were still on Excalibur's semi-monthly
payroll.
If you are terminated for cause you will not receive any further
compensation. If you resign you will not receive any further
compensation.
Expenses
Out-of-pocket and travel expenses will be approved on a case-by-case
basis and must be documented and filed on Excalibur's expense report
forms. Mileage for business travel will be reimbursed at the IRS standard
rate.
Other Benefits
Your are eligible for coverage by the company's health insurance plan for
full-time employees and will receive 3 weeks paid vacation per year,
which accrues at ten (10) hours per month with a maximum accrual of 120
hours. After 90 days of employment you will be eligible to participate in
Excalibur's 401(k) plan.
James Buchanan
September 7, 1995
Page 3
This letter outlines the basis for your compensation in the position of Chief
Financial Officer for Excalibur Technologies Corporation for the remainder of
fiscal year 1996. Nothing in this letter should be interpreted to imply a
duration of employment. You will be an employee at will with Excalibur
Technologies Corporation.
If you have any questions regarding any of the above, pleas do not hesitate to
contact me.
Sincerely,
/s/Patrick C. Condo
Patrick C. Condo
President
Cc: Personnel File
Please sign and return a copy of this letter documenting your understanding and
acceptance of these terms and conditions.
James Buchanan: /s/James Buchanan Date: 9/13/95
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James Buchanan
September 7, 1995
Page 4
ATTACHMENT
DEFINITION OF CAUSE
CAUSE: "Cause" shall mean any or all of the following: (i) the willful and
continued failure by Employee to perform his duties (other than any such failure
resulting from Employee's incapacity due to physical or mental illness or
injury) after demand for performance is delivered by the Company that
specifically identifies the manner in which the Company believes Employee has
not substantially performed his duties, which failure is not cured within 30
days after written notice is given; (ii) conduct by Employee involving fraud,
dishonesty, moral turpitude, willful or grossly negligent misconduct, bad faith
or other conduct amounting to a breach of Employee's fiduciary duties to the
Company (provided, however, that in the cause of grossly negligent misconduct
amounting to a breach of Employee's fiduciary duties to the company that, by its
nature, is susceptible to cure by subsequent acts of Employee, Employee shall
have 30 days after demand by the Company to cure such grossly negligent
misconduct); or (iii) a failure by Employee to comply with any material
provision of this Compensation Letter which failure is not cured within 30 days
after written notice of such noncompliance has been given by the Company to
Employee. For purposes of this definition of Cause, no act, or failure to act,
by Employee shall be considered "willful" unless done, or omitted to be done, by
him not in good faith and without reasonable belief that his action or omission
was in the best interest of the Company.