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EXHIBIT 10.12
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT (this "Agreement") dated as of November 25, 1997,
by and between Fundtech Corporation, a Delaware corporation (the "Company"), and
Reuven Ben-Menachem (the "Executive").
WITNESSETH:
WHEREAS, the Company desires to employ the Executive and retain and
make secure for itself the experience and abilities of the Executive all upon
the terms and conditions set forth in this Agreement; and
WHEREAS, the Executive desires to accept employment with the Company
upon the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the premises and the respective
covenants and agreements of the parties herein contained, and intending to be
legally bound hereby, the parties hereto agree as follows:
1. EMPLOYMENT. The Company hereby agrees to employ the Executive and
the Executive hereby agrees to be employed by the Company, on the terms and
conditions set forth in this Agreement.
2. TERM. The employment of the Executive by the Company hereunder shall
commence on January 1, 1998 and will end on the close of business on December
31, 1999, unless such employment term is renewed, extended or sooner terminated
as hereinafter provided (the "Employment Period"). As used herein, the term
"Employment Year" shall mean each year of the Employment Period commencing on
January 1 and ending on December 31, and each subsequent Employment Year
thereafter during the Employment Period.
3. POSITION AND DUTIES. During the Employment Period and subject to the
provisions of this Section 3, the Executive shall serve as the Chief Executive
Officer of the Company and shall faithfully perform all duties and
responsibilities as the Board of Directors of the Company may direct from time
to time. Additionally, without any additional compensation or benefits, the
Executive agrees to serve as the Chief Executive Officer of Fundtech Ltd., the
parent corporation of the Company, and to perform such duties and
responsibilities therefor as the Board of Directors of Fundtech Ltd. may direct
from time to time.
4. BEST EFFORTS. The Executive's employment with the
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Company shall be full time and the Executive shall devote his best efforts and
business time exclusively to the performance of his duties and responsibilities
as set forth in this Agreement, which duties and responsibilities shall be
performed competently, carefully and faithfully. The Executive shall not, while
an employee of the Company and without the prior written consent of the Board of
Directors of the Company, engage in any other occupation or activity which
conflicts with or impinges upon the full and faithful performance of the
Executive's duties and responsibilities, or otherwise violates any other term of
this Agreement. It is expressly understood and agreed that the provisions of
this Section 5 shall not be construed to prevent the Executive from investing or
trading for his own account; provided, that such investment activity does not
impair the full and faithful performance by the Executive of his duties and
responsibilities hereunder, or otherwise violate any term of this Agreement.
5. THE EXECUTIVE'S COMPENSATION.
(a) SALARY. During the Employment Period, the Company shall pay to the
Executive and annual base salary of one hundred sixty thousand Dollars
($160,000.00) (the "Base Compensation"). The Base Compensation will be paid to
the Executive in accordance with the normal payroll practices of the Company in
effect from time to time, less all appropriate withholdings for federal, state
and local taxes, and unemployment insurance. The amount of the Base Compensation
will be reviewed by the Company on an annual basis in January of each year
during the Employment Period commencing in January of the second Employment
Year. All adjustments to the Base Compensation, if any, shall be based on the
condition of the Company's business and the Company's evaluation of the
Executive's individual performance for the relevant period. Any adjustments
subsequently made to the Base Compensation shall be approved by the Compensation
Committee of the Board of Directors of Fundtech Ltd. in its sole and absolute
discretion.
(b) BONUS. The Executive is eligible to receive a bonus for each of the
Fiscal Years (as defined below) ending December 31 during the Employment Period.
The terms and conditions of the bonus are set forth in Schedule A attached
hereto and made a part hereof. As used herein the term "Fiscal Year" shall mean
the fiscal year of the Company ending on December 31, and each of the subsequent
fiscal years of the Company ending December 31 of each year during the
Employment Period.
6. THE EXECUTIVE'S BENEFITS. As an executive employee of the Company,
the Executive shall be entitled to receive the following benefits during
Employment Period:
(a) PARTICIPATION IN COMPANY BENEFIT PLANS. The
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Executive shall be entitled to participate in and to receive benefits under all
employee benefit plans offered by the Company from time to time during the
Employment Period to its executive personnel, subject to and on a basis
consistent with the terms, conditions and administration of such plans by the
Company. Notwithstanding the provisions of this Section 7(a) nothing contained
herein is intended, or shall be construed, to require the Company to institute
any benefit plan for the Executive or otherwise. In addition, nothing contained
herein shall limit the right of the Company to modify, suspend or discontinue
any and all benefit plans.
(b) VACATION, ILLNESS AND PERSONAL DAYS. The Executive shall be
entitled to an aggregate of twenty-two (22) paid days for use by the Executive
for vacation, illness or personal absence; provided, that such vacation days are
to be taken at times mutually agreeable to the Company and the Executive. The
Executive shall not be entitled to compensation in respect of earned but unused
vacation days except upon termination of employment and in such event; such
compensation shall be limited to the then current calendar year entitlement of
the Executive. In addition to the foregoing, the Executive shall be entitled to
receive all paid holidays given by the Company to its employees generally.
(c) AUTOMOBILE. During the Employment Period, the Executive may use the
automobile then owned by the Company at times, and from time to time, that such
automobile is made available by the Company to the Executive.
(d) BUSINESS EXPENSE REIMBURSEMENT. The Company shall promptly
reimburse or pay the Executive for all reasonable and necessary business
expenses paid or incurred by the Executive in performing his duties and
responsibilities hereunder; provided, that the Executive shall have submitted
such reasonable documentation as may be requested by the Company in accordance
with the reimbursement policies of the Company in effect from time to time.
7. TERMINATION. The Executive's employment with the Company may be
terminated as follows:
(a) WITH CAUSE. The Executive's employment with the Company may be
terminated by the Company at any time for "Cause." As used herein the term
"Cause" for termination shall include, but shall not be limited to, the
following; (i) theft, fraud, dishonesty, gross negligence or willful malfeasance
by the Executive in connection with the performance of his duties and
responsibilities hereunder; (ii) a breach or failure to fulfill and performance
the Executive's duties and responsibilities hereunder, which breach or failure
is not cured to the reasonable satisfaction of the Company within ten (10) days
after notice thereof from the Company or (iii) conviction of a felony or a crime
involving
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moral turpitude. Upon termination for Cause, all rights of the Executive under
this Agreement shall immediately terminate and the Company shall have no further
obligations hereunder.
(b) WITHOUT CAUSE. The Executive's employment with the Company may be
terminated by the Company at any time, and in such event, the Company shall
continue to pay to the Executive at a rate equivalent to the then current Base
Compensation of the Executive for a period of six (6) months following the date
of such termination (the "Severance Payment"). Additionally, the Company shall
pay to the Executive an amount for any earned but unused vacation, illness and
personal days of the Executive for the then current calendar year. The Executive
agrees that his eligibility to receive the Severance Payment shall be subject to
and contingent upon the Executive's execution of a full and complete release in
favor of the Company and its affiliated persons and entities having terms and
conditions that are reasonably acceptable to the Company. The Executive shall
also be entitled to receive his pro rata portion of any bonus to which he
becomes entitled to receive hereunder for the then current calendar year in
which such termination shall occur based upon the number of days in such year
that the Executive shall have been employed hereunder by the Company. The
payment of any such pro rata bonus shall be paid to the Executive at such time
as such payment would have been made to the Executive if he had continued to be
employed by the Company hereunder for the entire subject calendar year. If,
during any Employment Year, either (i) the Executive shall be assigned duties
and responsibilities by the Board of Directors of the Company which are
substantially lesser in scope and authority then the duties and responsibilities
assigned by the Board of Directors of the Company at the commencement of the
first Employment Year hereunder; (ii) the Base Compensation of the Executive
shall be decreased or (iii) the Executive shall be otherwise constructively
terminated by the Company as evidenced by a judgement entered in favor of the
Executive regarding a claim therefor against the Company, then, if the Executive
shall resign from the employment by the Company because of such assignment or
decrease or obtain such judgement, the Executive shall be entitled to the
Severance Payment and the aforesaid pro rata bonus payment contingent upon the
Executive's execution of the release set forth above.
(c) TERMINATION FOR DEATH OR DISABILITY. This Agreement and the
Executive's employment hereunder shall terminate immediately upon the
Executive's death or Disability. For purposes of the preceding sentence, the
term "Disability" shall mean the Executive's inability, by reason of physical or
mental incapacity, to render services hereunder for an aggregate of ninety (90)
days during any twelve (12) month period (the "Disabled Period"). In the event
of the Executive's Disability during the Employment Period for any period
shorter than the Disabled Period, the Company agrees to compensate the Executive
at the Executive's then current Base Compensation, less amounts received by the
Executive pursuant to any disability insurance
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coverage provided by the Company or the Social Security disability insurance
program, for the duration of the Disability or until expiration of the term of
this Agreement, whichever is earlier. If the Executive's employment shall be
terminated due to death or disability, the Company shall have no further
obligations under this Agreement to the Executive or the Executive's heirs,
beneficiaries or other personal representatives. The Executive shall also be
entitled to receive his pro rata portion of any bonus to which he becomes
entitled to receive hereunder for the then current calendar year in which such
termination shall occur based upon the number of days in such year that the
Executive shall have been employed hereunder by the Company. The payment of any
such pro rata bonus shall be paid to the Executive at such time as such payment
would have been made to the Executive if he had continued to be employed by the
Company hereunder for the entire subject calendar year.
(d) RESIGNATION; NO FURTHER OBLIGATION. The termination of the
Executive for any reason whatsoever shall constitute the Executive's resignation
as an employee, officer and director, as the case may be, of the Company,
Fundtech Ltd. and all of its affiliates. Except as expressly set forth herein
upon such termination, the Company shall have no further obligation to the
Executive including, without limitation, any obligation to pay to the Executive
any severance payment or to pay for the continuation of any benefits for the
Executive or his dependents. The Executive agrees that in the event he decides
to terminate his employment by the Company, he shall provide the Company with at
least sixty (60) days prior notice thereof and shall cooperate with the Company
during such notice period regarding the transaction of the Executive's duties
and responsibilities.
(e) PUBLIC STATEMENTS. Upon termination of the Executive's employment
for any reason, the Company will direct and control the issuance and content of
any announcement, release or other statement to any third party in relation
thereto, including employees and clients of the Company and its affiliates, and
the press.
8. NONCOMPETITION AND CONFIDENTIALITY. The Executive acknowledges that
he executed a non-competition and confidentiality agreement, a copy of which is
attached hereto as Schedule B (the "Non-competition and Confidentiality
Agreement") on February 2, 1995. The Executive acknowledges and agrees that the
Non-competition and Confidentiality Agreement is, and will continue to be, in
full force and effect and enforceable against the Executive in accordance with
its terms and conditions. Additionally, in consideration of the employment of
the Executive by the Company hereunder upon the terms hereof, the Executive
hereby agrees that all references in the Non-competition and Confidentiality
Agreement to Fundtech Ltd. shall also be deemed to be references to the Company
for all of the obligations of the Executive set forth therein.
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9. BUSINESS OPPORTUNITIES. During the Employment Period, the Executive
agrees to bring all business opportunities to the Company directly relating to
or otherwise associated with the business or businesses then conducted by the
Company and each affiliates thereof, or business or businesses proposed to be
conducted by the Company and any such affiliate in the future. The Executive
further agrees not to pursue any such business opportunity or opportunities for
his own account or for the account of any third party irrespective of the
Company's decision to exploit or not to exploit any such business opportunity.
10. NO DISPARAGING STATEMENTS. The Executive agrees to refrain, during
the Employment Period and thereafter, from making any disparaging statements,
either orally or in writing, about the Company or any affiliate of the Company,
or about any directors, officers, shareholders, partners employees, agents or
other representatives of the Company or any affiliate thereof.
11. EXTENSIONS; RENEWALS. The initial term of this Agreement as set
forth in Section 2 hereof may be renewed or extended for such additional
period(s) as the Executive and the Company may agree to in writing. It is
expressly understood and agreed, however, that the provisions of this Section 12
shall not create any obligation on the part of the Executive or the Company to
agree to any such renewal or extension.
12. COMPLIANCE WITH OTHER AGREEMENTS. The Executive represents and
warrants to the Company that the execution and delivery by the Executive of this
Agreement and the performance by the Executive of his obligations hereunder will
not (i) violate any judgement, writ, injunction or order of any court,
arbitrator or governmental agency applicable to the Executive, or (ii) conflict
with, result in the breach of any provision of or the termination of, or
constitute a default under, any agreement to which the Executive is a party or
by which the Executive is or may be bound.
13. AMENDMENT; WAIVER. No provision of this Agreement may be amended or
waived unless such amendment or waiver, is agreed to in writing and signed by
the Executive and a duly authorized representative of the Company. No waiver by
either party hereto at any time of any breach by the other party hereto of, or
compliance with any condition or provision of this Agreement to be performed by
such other party shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same at any prior or subsequent time.
14. VALIDITY. The invalidity or unenforceability of any provision or
provisions of this Agreement shall not affect the validity or enforceabilility
of any other provision of this Agreement, which shall remain in full force and
effect.
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15. NOTICES. All notices and other communications provided for in this
Agreement shall be in writing and shall be delivered by hand or sent by postage
prepaid, registered mail or a nationally recognized overnight courier service,
and shall be deemed given when so delivered by hand or, if mailed, three (3)
days after mailing or, if by overnight courier service, one (1) business day
after deposit with such overnight courier service addressed as follows:
If to the Executive:
Mr. Reuven Ben-Menachem
c/o Fundtech Corporation
30 Montgomery Street, Suite 501
Jersey City, NJ 07302
If to the Company:
Fundtech Corporation
30 Montgomery Street, Suite 501
Jersey City, NJ 07302
Attention: General Counsel
With a copy to:
Fundtech Ltd.
2 Habonim Street
Ramat-Gan
Israel
Attention: General Counsel
or to such other address as any party may have furnished to the other in writing
in accordance herewith, except that notices of change of address shall be
effective only upon receipt.
16. HEADING. All headings contained in this Agreement are for reference
purposes only and shall not in any way effect the meaning or interpretation of
any provision or provisions of this Agreement.
17. ENTIRE AGREEMENT. This Agreement and the Non-competition and
Confidentiality Agreement sets forth the entire agreement of the parties hereto
in respect of the subject matter contained herein and supersedes all prior
agreements, promises, understandings, representations or warranties, whether
oral or written, by any party or representative of any party hereto.
18. ASSIGNMENT. This Agreement may not be assigned by the Executive,
but may be assigned by the Company to any successor to its business and will
inure to the benefit and be binding upon any such successor.
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19. COUNTERPARTS. This Agreement may be executed in several
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.
20. GOVERNING LAW. The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of the State of New
Jersey without regard to its conflicts of law principles.
IN WITNESS WHEREOF, the parties have executed this Agreement on the date and
year first above written.
FUNDTECH CORPORATION:
By: /s/
----------------------
Name:
--------------------
Title:
-------------------
EXECUTIVE:
By: /s/ Reuven Ben-Menachem
----------------------
Name: Reuven Ben-Menachem
--------------------
Title: Executive
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SCHEDULE A
BONUS
1. $100,000: upon completion of an initial public offering of the
capital stock of Fundtech Ltd. in the United States
and the commencement of the reporting of the trading
prices thereof by the National Association of
Securities Dealers, Inc. through NASDAQ or through a
similar organization if NASDAQ is no longer reporting
such prices.
2. For each Employment Year:
(i) $10,000 upon achieving year-end revenue targets as approved
by the Board of Directors of Fundtech Ltd.
(ii) $10,000 upon achieving year-end profit targets as approved by
the Board of Directors of Fundtech Ltd.
(iii) $10,000 upon achieving 110% of year-end revenue targets as
approved by the Board of Directors of Fundtech Ltd.
(iv) $10,000 upon achieving 120% of year-end revenue targets as
approved by the Board of Directors of Fundtech Ltd.