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EXHIBIT (d)(11)
EMPLOYMENT AND NON-COMPETITION AGREEMENT
This EMPLOYMENT AGREEMENT (this "Agreement") is made as of the 20th day of
February 2001 by and between SYBASE, INC., a Delaware corporation ("Sybase"),
and PAT FORTUNE, an individual residing at Englewood, Co. (the "Employee").
BACKGROUND
The Employee is a shareholder of [NEON] and is employed by [NEON]. Sybase
and [NEON] have entered into an Agreement and Plan of Reorganization dated of
even date herewith (the "Merger Agreement") which requires, among other things,
that the Employee enter into this Agreement as part of the merger described in
the Merger Agreement (the "Merger"). This Agreement is to be effective only
upon the Effective Date (as defined in the Merger Agreement) at which time
Sybase will assign all of its rights and obligations under this Agreement to
the Surviving Corporation (as defined in the Merger Agreement). Sybase wishes
to secure on behalf of the Surviving Corporation the services of the employee
upon the terms and conditions hereinafter set forth, and the Employee wishes to
render such services to the Surviving Corporation upon the terms and conditions
hereinafter set forth.
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants herein contained and for other good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, the parties agree as
follows:
1) EMPLOYMENT BY THE SURVIVING CORPORATION. Sybase agrees to employ the Employee
as Senior Vice President of the e-business Platform Division, and the
Employee accepts such employment and agrees to perform such duties as are
consistent with his title and position. Employee's duties shall be those
customarily performed by a person holding the same title at a company of
similar size and industry as the Surviving Corporation, and he shall report
directly to the Rick Adam of the Surviving Corporation. The Employee agrees
to devote his full business time to the business of the Surviving
Corporation and/or its Affiliates and to faithfully, diligently and
competently perform his duties hereunder.
2) TERM OF EMPLOYMENT. The Term of this Agreement shall commence on the
Effective Date and continue until terminated as set forth herein. The
parties agree that Employee's employment will be "at will" employment and
may be terminated at any time with or without cause or notice. Employee
understands and agrees that neither his job performance nor promotions,
commendations, bonuses or the like give rise to or in any way serve as the
basis
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for modification, amendment or extension, by implication or otherwise, of
his employment hereunder.
3. COMPENSATION. As compensation for all services to be rendered by the
Employee to the Surviving Corporation and/or its Affiliates in all
capacities during the Term, the Employee shall receive the following
compensation and benefits:
a) SALARY. An annual base salary of ($400,000) (the "Base Salary"),
less required withholdings, which shall be paid on a regular basis in
accordance with the Surviving Corporation's normal payroll procedures
and policies.
b) BONUS. The Employee shall be eligible to receive bonuses in
accordance with such bonus plans as are applicable to employees of
the Surviving Corporation from time to time. For calendar year 2001,
the targeted bonus is $200,000 less required withholdings (which
bonus shall only be payable to the extent carried under the terms of
the applicable bonus plan).
c) PARTICIPATION IN EMPLOYEE BENEFIT PLANS. The Employee shall be
permitted during the Term, if and to the extent eligible, to
participate in all employee benefit plans, policies and practices now
or hereafter maintained by or on behalf of the Surviving Corporation
for employees having positions with the Surviving Corporation
commensurate with the Employee's position with the Surviving
Corporation. Nothing in this Agreement shall preclude the Surviving
Corporation from terminating or amending any such plans or coverage
so as to eliminate, reduce or otherwise change any benefit payable
thereunder, so long as such change similarly affects all Surviving
Corporation employees having positions with the Surviving Corporation
that are commensurate with the Employee's position with the Surviving
Corporation.
d) EXPENSES. The Surviving Corporation shall pay or reimburse the
Employee for all reasonable expenses actually incurred or paid by the
Employee during the Term in the performance of the Employee's duties
under this Agreement, upon submission and approval of expense
statements, vouchers or other supporting information, in accordance
with the then customary practices of the Surviving Corporation.
e) VACATION. The Employee shall be entitled to vacation in accordance
with Sybase policy.
f) WITHHOLDING OF TAXES. The Surviving Corporation may withhold from
any compensation payable under this Agreement all federal, state,
city and other taxes as shall be required pursuant to any law or
governmental regulation or ruling.
g) STOCK OPTIONS. The Surviving Corporation shall grant to Employee
stock options (the "Employee Option") to acquire up to 125,000 shares
of Sybase, Inc. common stock. The stock options granted to Employee
shall vest such that 1/8th of such option shares shall
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vest six months after the Effective Date, and 1/48th of such option
shares shall vest each month thereafter through the 48th month after
the Effective Date. Otherwise, the stock options granted will be upon
the same terms and conditions as are generally provided under the
Sybase, Inc. Stock Plans.
4) TERMINATION
a) TERMINATION UPON DEATH. If the Employee dies during the Term, this
Agreement shall terminate as of the date of his death.
b) TERMINATION UPON DISABILITY. If, during the Term, the Employee
becomes physically or mentally disabled, the Surviving Corporation
may, by written notice to the Employee, terminate this Agreement, in
which event the Term shall terminate 30 days after the date upon
which the Surviving Corporation shall have given notice to the
Employee of its intention to terminate this Agreement because of such
disability. Disability shall be determined in accordance with the
terms of the applicable policies and benefit plans of the Surviving
Corporation.
c) TERMINATION FOR CAUSE. The Surviving Corporation may at any time by
written notice to the Employee terminate this Agreement immediately,
and the Employee shall have no right to receive any compensation or
benefit hereunder on and after the date of such notice, in the event
that an event of "Cause" occurs. For purposes of this Agreement
"Cause" shall mean:
(i) the continuous failure by the Employee to perform the material
duties and responsibilities that are reasonably consistent with
his position which remain uncured for a period of fifteen (15)
days after receipt of notice thereof from the Surviving
Corporation;
(ii) a conviction of, a plea of nolo contendere, a guilty plea or
confession by the Employee to a felony or the committing of an
act of fraud or material dishonesty against, or the
embezzlement, theft or misappropriation of property belonging
to, the Surviving Corporation or its Affiliates;
(iii) the Employee personally engaging in conduct that he reasonably
should know or that he intends to be seriously injurious to the
business of the Surviving Corporation or its Affiliates (it
being understood that business decisions made by the Employee
in good faith are not to be considered grounds for termination
for Cause); or
(iv) the material breach by the Employee of this Agreement or the
Nondisclosure and Assignment of Inventions Agreement which is
not cured within fifteen (15) days after receipt of notice
thereof from the Surviving Corporation (except for a breach of
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Section 7 hereof or a breach of the Nondisclosure and Assignment
of Inventions Agreement for which no cure period is provided).
d) TERMINATION WITHOUT CAUSE. The Surviving Corporation may terminate
this Agreement at any time, without cause, and the Employee shall have
no right to receive any compensation or benefit hereunder after such
termination except as set forth in Section 5 below. Employee may
terminate this Agreement without cause, and the Employee shall have no
right to receive any compensation or benefit hereunder after such
termination.
e) SURRENDER OF RECORDS AND PROPERTY. Upon termination of his employment
with the Surviving Corporation, Employee shall deliver promptly to the
Surviving Corporation all property and all tangible forms of
Confidential Information in accordance with the terms of the
Nondisclosure and Assignment of Inventions Agreement between Sybase
and the Employee.
5) SEVERANCE PAYMENTS AND OTHER RIGHTS.
a) CERTAIN SEVERANCE PAYMENTS AND OTHER RIGHTS. If, during the Term, the
Surviving Corporation terminates this Agreement pursuant to Section
4(d), all compensation payable to the Employee under Section 3 shall
cease as of the date of termination specified in the Surviving
Corporation's notice (the "Termination Date"), and the Surviving
Corporation shall pay or provide to the Employee the following,
provided that the Employee first enters into and does not revoke a
binding written agreement releasing all claims, known or unknown, that
the Employee has or might have against the Surviving Corporation in
connection with this Agreement and other employment arrangements with
the Surviving Corporation and its Affiliates and for wrongful
discharge, and provided further that the Employee has not violated the
terms of Section 7 of this Agreement. (Payment of the severance
payments does not constitute an acknowledgement by the Surviving
Corporation of the Employee's compliance with the terms of Section 7.)
All severance payments shall be subject to applicable tax withholding,
and shall be in lieu of any further payments under this Agreement or
under any other employment arrangements between the Employee and the
Surviving Corporation.
(i) a lump sum amount equal to the SVP severance package then
applicable to employees.
(ii) for a period equal to the earlier of 24 mos or (y) the date upon
which Employee and his covered dependents become covered under
comparable group health, plans of another employer, payment of
applicable premiums under COBRA for group health coverage in
order to provide the Employee and his covered dependents
equivalent
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coverage to that which they were entitled to while Employee
was an employee of the Surviving Corporation immediately
prior to his termination; and
(iii) all previously accrued vacation pay.
b) PAYMENTS UPON TERMINATION FOR CAUSE, DEATH OR DISABILITY. If this
Agreement is terminated by the Surviving Corporation pursuant to
Sections 4(a), 4(b) or 4(c), the Employee shall receive only the
amounts owing through the Termination Date.
6) REPRESENTATION AND WARRANTY OF EMPLOYEE. The Employee represents and
warrants that neither the execution nor the delivery of this
Agreement, nor the employment of the Employee by the Surviving
Corporation will result in the breach of any agreement to which the
Employee is a party, except where any such breach would not have a
material adverse effect on the business, financial condition or
operations of the Surviving Corporation.
7) COVENANTS. The Employee acknowledges that: (i) he is one of the
limited number of persons who will develop the business of the
Surviving Corporation; (ii) his work for the Surviving Corporation has
brought him and will continue to bring him into close contact with
many confidential affairs not readily available to the public; and
(iii) the covenants contained in this Section 7 will not involve a
substantial hardship upon his future livelihood. In light of such
acknowledgement, and in partial consideration of the several
agreements made by Sybase with the Employee in the Merger Agreement
and in order to induce the Surviving Corporation to enter into this
Agreement and the Merger Agreement, the Employee covenants and agrees
that:
a) NON-COMPETE. During the period of this employment by the
Surviving Corporation under this Agreement and for 18 months
following the termination of the Employee's employment for any
reason, provided the Surviving Corporation is not in breach of
its obligations under Section 5, the Employee shall not, directly
or indirectly: (i) in any manner whatsoever engage in any
capacity with any Restricted Business in a Restricted Territory
(as such terms are defined below) for the Employee's own benefit
or for the benefit of any Person other than the Surviving
Corporation; or (ii) have any interest as owner, sole proprietor,
shareholder, partner, lender, director, officer, manager,
employee, consultant, agent or otherwise in any Restricted
Business in a Restricted Territory; provided, however, that the
Employee may hold, directly or indirectly, solely as an
investment, not more than two percent (2%) of the outstanding
securities of any person or entity which are listed on any
national securities exchange or regularly traded in the
over-the-counter market notwithstanding the fact that such person
or entity is a Restricted Business in a Restricted Territory.
"Restricted Business" shall mean (A) a business which is
competitive with the Surviving Corporation's business engaged in
by the Surviving Corporation at the date of his
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termination of employment (the "Surviving Corporation's Business")
and (B) Oracle Systems Corporation, Informix Corporation, the
database product groups or organizations of Computer Associates, the
database product groups or organizations of Microsoft Corporation and
the database product groups or organizations of IBM. Notwithstanding
the above, the Employee may become an employee of or consultant to or
have an interest as owner, sole proprietor, shareholder, partner,
lender, director, officer, manager, employee, consultant, agent or
otherwise in a business unit of a larger enterprise which enterprise
then has another business unit engaged in a business competitive with
the Surviving Corporation's Business, provided that the business unit
of the larger enterprise for which Employee provides services or in
which he has an interest is neither (1) in a business competitive
with the Surviving Corporation's Business and is located in a
geographically separate location from the competitive business unit
and the Employee has no responsibility and has no role whatsoever in
the competing business unit nor (2) a company or business unit listed
in clause B of this paragraph.
"Restricted Territory" shall mean the larger of (i) the counties,
cities and states of the United States of America and each political
subdivision of Canada, Australia, Japan, each member of the European
Economic Community and any other country in which the Surviving
Corporation's products are sold or licensed during the term of the
non-compete obligations or (ii) if (i) is found unenforceable, the
counties, cities, states and political subdivisions of any country in
which the Surviving Corporation's products are sold, distributed or
licensed during the term of the non-compete obligations.
The parties intend that the covenants contained in this Section 7(a)
shall be construed as a series of separate covenants, one for each
county, city, state and other political subdivision of each country
in the Restricted Territory. Except for geographic coverage, each
separate covenant shall be deemed identical in terms to the covenant
contained in the preceding paragraphs. If, in any judicial
proceeding, a court shall refuse to enforce any of the separate
covenants (or any part thereof) deemed included in said paragraphs,
then such unenforceable covenant (or such part) shall be deemed
eliminated from this Agreement for the purpose of those proceedings
to the extent necessary to permit the remaining separate covenants
(or portions thereof) to be enforced by such court. It is the intent
of the parties that the covenants set forth herein be enforced to the
maximum degree permitted by applicable law.
In the event that the provisions of this Section 7(a) should ever be
deemed to exceed the scope, time or geographic limitations of
applicable law regarding covenants not to compete, then such
provisions shall be reformed to the maximum scope, time or geographic
limitations, as the case may be, permitted by applicable laws.
b) NON-DISCLOSURE OF CONFIDENTIAL INFORMATION. Concurrently with the
execution of this Agreement, the Employee shall enter into a
Nondisclosure And Assignment of Inventions
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Agreement in the form attached hereto.
c) NON-SOLICITATION OF EMPLOYEES OF AND CONSULTANTS TO THE SURVIVING
CORPORATION. During the period of his employment by the Surviving
Corporation under this Agreement and for 18 months following the
termination of the Employee's employment for any reason, the Employee
shall not, directly or indirectly, initiate communications with,
solicit, persuade, entice, induce or encourage any individual who is
then or who has been within the preceding 12-month period, an
employee of or consultant to the Surviving Corporation to terminate
an employment or consulting relationship with the Surviving
Corporation, as the case may be, or to become employed by or enter
into a contract or other agreement with any other person, and the
Employee shall not approach any such employee or consultant for any
such purpose or authorize or knowingly approve the taking of any such
actions by any other person.
d) NON-SOLICITATION OF CUSTOMERS. During the period of his employment by
the Surviving Corporation under this Agreement and for 18 months
following the termination of the Employee's employment for any
reason, the Employee shall not, directly or indirectly, solicit,
persuade, entice, induce, encourage (or assist in connection with any
of the foregoing) any person who is then or has been within the
preceding 24-month period a customer or account of the Surviving
Corporation, or any infomediary, affiliate, service provider or
fulfillment entity that does business with the Surviving
Corporation, or any actual customer leads whose identity the Employee
learned during the course of his employment with the Surviving
Corporation, to terminate or to adversely alter its contractual or
other relationship with the Surviving Corporation.
e) RIGHTS AND REMEDIES UPON BREACH. If the Employee breaches or
threatens to commit a breach of, any of the provisions of this
Section 7 (collectively, the "Restrictive Covenants"), the Surviving
Corporation shall have the right and remedy to seek from any court of
competent jurisdiction specific performance of the Restrictive
Covenants or injunctive relief against any act which would violate
any of the Restrictive Covenants, it being acknowledged and agreed
that any such breach or threatened breach will cause irreparable
injury to the Surviving Corporation and that money damages will not
provide an adequate remedy to the Surviving Corporation.
f) REPRESENTATION OF THE EMPLOYEE. The Employee is (i) familiar with the
covenants in this Section 7, (ii) is fully aware of his obligations
hereunder, (iii) finds the length of time, scope and geographic
coverage of these covenants to be reasonable, and (iv) is receiving
specified, bargained-for consideration for these covenants.
8) MISCELLANEOUS.
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a) NOTICES. Any notice or other communication required or which may be
given hereunder shall be in writing and shall be delivered
personally, telecopied, telegraphed or telexed, or sent by
certified, registered or express mail, postage prepaid, to the
parties at the following addresses, or at such other addresses as
shall be specified by the parties by like notice, and shall be
deemed given when so delivered personally, telecopied, telegraphed
or telexed, or if mailed, two (2) days after the date of mailing,
as follows:
if to the Surviving Corporation, to the officer of the Surviving Corporation
holding the title of Secretary, to him or her at the Surviving Corporation's
Principal Place of Business
with copies to:
General Counsel
Sybase, Inc.
6475 Christie Ave.
Emeryville, CA 94698
Telecopier: (510) 922-4558
if to the Employee, to him at the address set forth on the first page hereof
with copies to:
Pat Fortune
6550 Greenwood Plaza Blvd.
Englewood, CO 80111
Telecopier:
b) ENTIRE AGREEMENT. This Agreement contains the entire agreement
between the parties with respect to the subject matter hereof and
supersedes all prior contracts and other agreements, written or
oral, with respect thereto.
c) WAIVERS AND AMENDMENTS. This Agreement may be amended, modified,
superseded, cancelled, renewed or extended, and the terms and
conditions hereof may be waived, only by a written instrument
signed by the parties or, in the case of a waiver, by the party
waiving compliance.
d) GOVERNING LAW. This Agreement shall be governed by, and construed
in accordance with and subject to, the laws of the State of
California without regard to its conflicts of laws principles.
e) ASSIGNMENT. This Agreement, and the Employee's rights and
obligations hereunder, may not be assigned by the Employee. The
Surviving Corporation may assign this Agreement
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and its rights, together with its obligations, hereunder only in
connection with any sale, transfer or other disposition of all or
substantially all of its assets or business, whether by merger,
consolidation or otherwise. This Agreement shall inure to the benefit
of and be binding upon the parties hereto and any successors and
permitted assigns.
f) DEFINITIONS. For purposes of this Agreement:
(i) "Affiliate" shall mean a Person that, directly or indirectly,
controls or is controlled by, or is under common control with
the Surviving Corporation;
(ii) "control" as used with respect to any Person, shall mean the
possession, directly or indirectly, of the power to direct or
cause the direction of the management or policies, whether
through ownership of voting securities, by contract or
otherwise; and
(iii) "Person" means an individual, sole proprietorship,
partnership, corporation, association, joint stock Surviving
Corporation, trust, joint venture, unincorporated
organization, institution, entity or government (whether
federal, state, local or otherwise including without
limitation, or any department, agency, or political
subdivision thereof).
g) COUNTERPARTS; FACSIMILE EXECUTION. This Agreement may be executed in
two or more counterparts, each of which shall be deemed an original
but all of which together shall constitute one and the same
instrument. Facsimile execution and delivery of this Agreement is
legal, valid and binding execution and delivery for all purposes.
h) HEADINGS. The headings in this Agreement are for reference purposes
only and shall in no way affect the meaning or interpretation of this
Agreement.
i) SURVIVAL. Sections 4(e), 5, 6, 7 and this Section 8 shall survive
termination of this Agreement for any reason.
j) SEVERABILITY. To the extent any provision of this Agreement shall be
invalid or unenforceable, it shall be considered deleted herefrom and
the remainder of such provision and of this Agreement shall be
unaffected and shall continue in full force and effect. In
furtherance and not in limitation of the foregoing, should the
duration of geographical extent of, or business activities covered by
any provision of this Agreement be in excess of that which is valid
and enforceable under applicable law, then such provision shall be
construed to cover only that duration, extent or activities which may
validly and enforceably be covered.
k) ADR. Except as provided herein, no civil action with respect to any
dispute, claim or controversy arising out of or relating to this
Agreement may be commenced until the matter has been submitted to
JAMS/ENDISPUTE, or its successor, for mediation. Either
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party may commence mediation by providing to JAMS/ENDISPUTE and the other
party a written request for mediation, setting forth the subject of the
dispute and the relief requested. The parties will cooperate with
JAMS/ENDISPUTE and with one another in selecting a mediator from
JAMS/ENDISPUTE's panel of neutrals, and in scheduling the mediation
proceedings. The parties covenant that they shall participate in the
mediation in good faith, and that they shall share equally in its costs.
All offers, promises, conduct and statements, whether oral or written, made
in the course of the mediation by any of the parties, their agents,
employees, experts and attorneys, and by the mediator and any
JAMS/ENDISPUTE employees, are confidential, privileged and inadmissible for
any purpose, including impeachment, in any litigation or other proceeding
involving the parties, provided that evidence that is otherwise admissible
or discoverable shall not be rendered inadmissible or non-discoverable as a
result of its use in the mediation. Either party may seek equitable relief
prior to the mediation to preserve the status quo pending the completion of
that process. Except for such an action to obtain equitable relief,
neither party may commence a civil action with respect to the matters
submitted to mediation until after the completion of the initial mediation
session, or 45 days after the date of filing the written request for
mediation, whichever occurs first. Mediation may continue after the
commencement of a civil action, if the parties so desire. The provisions of
this Clause may be enforced by any Court of competent jurisdiction, and the
party seeking enforcement shall be entitled to an award of all costs, fees
and expenses, including attorneys fees, to be paid by the party against
whom enforcement is ordered.
l) SUPERCEDES OLD AGREEMENTS. Employee agrees that the terms of this Agreement
supercede the terms of any and all employment arrangements he may have had
with the Surviving Corporation in their entirety (except that that certain
Agreement dated 2/16/01, 2001 shall survive). Employee agrees that
Employee's decision to terminate such employment arrangements and enter
into this Agreement does not constitute constructive termination of any
employment arrangement Employee had with [NEON].
m) COSTS OF ENFORCEMENT OR DEFENSE. In the event of any litigation with
respect to this Agreement, the prevailing party shall be entitled to be
paid by the other party hereto all costs of enforcement or defense, as the
case may be, paid or incurred in connection with the enforcement or
defense, including reasonable attorney fees and legal costs.
n) DELAYS OR OMISSIONS. No delay or omission to exercise any right, power or
remedy accruing to either party upon any breach or default of the other
party hereto shall impair any such right, power or remedy of such
non-defaulting party, nor shall it be construed to be a waiver of any such
breach or default or an acquiescence therein, or of or in any similar
breach or default thereafter occurring; nor shall any waiver of a breach or
default be deemed to be a waiver of any other breach or default.
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o) RULES OF CONSTRUCTION. Sybase and the Employee each acknowledge that
they have been represented by competent counsel during the
negotiation and execution of this Agreement and therefore waive the
application of any law, regulation, holding or rule of construction
providing that ambiguities in any agreement will be construed
against the party drafting the agreement.
p) CLOSING. This Agreement shall become effective at the time of the
Closing on the Effective Date.
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first above written.
SYBASE, INC.
By: /s/ DANIEL R. CARL
-------------------------
Name: Daniel R. Carl
Title: Vice President,
General Counsel
and Secretary
EMPLOYEE:
/s/ PATRICK J. FORTUNE
-------------------------------
Name: Patrick J. Fortune
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