EXHIBIT 10.3
[LETTERHEAD OF MERCATOR SOFTWARE]
May 25, 2001
Ms. Eileen Garry
107 Briar Brae Road
Stamford, CT 06903
Dear Eileen:
On behalf of Mercator Software, I am pleased to extend an offer of
employment to you as Chief Marketing Officer. In this role you will report to me
and be a member of the executive management team, operations committee, strategy
council, and participate in the strategic and operational needs of the business.
I look forward to bringing you on board as a key member of our executive
leadership team. Following are details of our offer to you.
1. Position. You will start in a full-time position on or before July 9, 2001 as
Chief Marketing Officer reporting to me. By signing this letter, you confirm to
the Company that you are under no contractual or other legal obligations that
would prohibit you from entering employment with or performing your duties for
the Company.
2. Compensation and Employee Benefits. You will be paid a starting salary at the
annual rate of $200,000, subject to an annual compensation review each year
beginning February 1, 2002, and payable in accordance with the Company's
standard payroll schedule. We will also offer you the opportunity to participate
in the Company's annual incentive bonus plan, under which you will be eligible
to earn, at par, a bonus of 100% of your base salary. The bonus payout is based
upon corporate and business unit performance and individual contribution in
meeting our objectives. The payout range is zero to 300%. The Company agrees to
prorate the first year's bonus back to April 1, 2001. It will be payable in the
first quarter of 2002, consistent with when other executives at this level are
paid. As a senior executive of the Company, you will be eligible to participate
in the company-sponsored benefits that the Company makes available to senior
executives (e.g., health insurance, dental insurance, etc.).
3. Options. You will be granted 60,000 options upon joining the company with an
exercise price equal to the fair market value on the date of grant. You will be
eligible for an additional 150,000 options, to be granted upon your start date.
All of these options will be subject to the attached vesting schedule.
Upon a change of control of Mercator, 50% of your outstanding, unvested stock
options will vest and become immediately exercisable. A change of control will
be defined as the company being acquired and as a result it is no longer
publicly traded. The options that you acquire shall be subject to the terms and
conditions of the relevant stock option plan and stock option agreement and
other related agreements to be entered into by and between you and the Company.
In the event your employment is terminated by death or disability, options to be
vested within six (6) months of your death or disability will be vested and be
exercisable for the balance of their original term.
Ms. Eileen Garry
May 25, 2001
Page 2
4. Vacation. You will be entitled to four weeks vacation, in addition to
scheduled company holidays.
5. Life Insurance. As an executive within the company, you will be entitled to
receive term life insurance in the amount of $500,000 payable by the Company.
6. Severance. If you are terminated for any reason other than for cause, you
will be entitled to six months' salary payable biweekly. In addition, executive
benefits for medical insurance and other executive perquisites will be provided
for six months.
If there is a change of control of the Company as defined in paragraph 3 herein,
within one year following a change of control of the Company, you may terminate
your employment with the Company if, during that one year period without your
written consent, there has occurred a significant diminution of, or assignment
to you of any duties inconsistent with your title, status, duties or
responsibilities as in effect as of the beginning of your employment with
Mercator. This right of termination can be exercised only if you give written
notice to the Company within thirty (30) days of the occurrence of the
significant diminution of, or assignment to you of any duties inconsistent with
your title, status, duties or responsibilities as in effect as of the beginning
of your employment with Mercator which you rely upon to terminate this
agreement. If you elect to terminate your employment pursuant to this provision,
upon such termination Mercator shall pay you twelve (12) months of base salary
in accordance with the Company's usual payroll practices.
7. Outside Activities. While you render services to the Company, you agree that
you will not engage in any other employment, consulting or other business
activity without the written consent of the Company. You also will not assist
any person or entity in competing with the Company, in preparing to compete with
the Company, or in hiring any employees or consultants of the Company.
8. Employment Relationship. The term of your employment with the Company is for
no specific period of time. Your employment with the Company will be "at will,"
meaning that either you or the Company may terminate your employment at any time
and for any reason, with or without cause with 30 days notice. This is the full
and complete agreement between you and the Company on this term. Although your
job duties, title, compensation and benefits, as well as the Company's personnel
policies and procedures, may change from time to time, the "at will" nature of
your employment may only be changed in an express written agreement signed by
you and the Company.
9. Withholding Taxes. All amounts of compensation referred to in this letter are
subject to reduction by the Company to meet all applicable withholding and
payroll tax requirements.
Ms. Eileen Garry
May 25, 2001
Page 3
10. Conditions of Employment. Upon joining Mercator, you will be required to
sign the enclosed Conditions of Employment agreement that includes
non-disclosure and non-compete clauses which set forth conditions relating to
the security and protection of the Company's trade secrets. In addition, you
will be required to comply with and periodically sign a certification of
compliance with Mercator's Insider Trading Policy.
11. Entire Agreement. This letter supersedes and replaces any prior
understandings or agreements, whether oral or written, between you and the
Company regarding the subject matter described in this letter.
We hope that you find the foregoing terms acceptable. You may indicate
your agreement with these terms and accept this offer by signing and dating the
line provided below and returning the executed copy to the undersigned. The
terms and conditions of this offer will expire on May 30, 2001. As required by
law, your employment with the Company is also contingent upon your providing
legal proof of your identify and authorization to work in the United States.
I look forward to working with you and having you as a member of my
executive team.
If you have any questions, please call me at (203) 563-1201.
Very truly yours,
MERCATOR SOFTWARE, INC.
/s/ Roy C. King
Roy C. King
Chief Executive Officer and Chairman
I have read and accept this employment offer:
/s/ Eileen M. Garry Date: 6/6/01
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Signature of Eileen Garry
July 5, 2001
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Agreed start date
Attachment - Vesting Schedule
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# of Options Date of Vesting
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60,000 Date of Hire
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9,375 09/30/01
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9,375 12/30/01
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9,375 03/30/02
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9,375 06/30/02
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9,375 09/30/02
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9,375 12/30/02
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9,375 03/30/03
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9,375 06/30/03
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9,375 09/30/03
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9,375 12/30/03
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9,375 03/30/04
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9,375 06/30/04
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9,375 09/30/04
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9,375 12/30/04
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9,375 03/30/05
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9,375 06/30/05
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