Exhibit 10.10
AGREEMENT
This Agreement ("Agreement") is entered into as of January 1, 2002,
between Mark Tierney ("Tierney") and eBenX ("Employer").
WHEREAS, Tierney is currently employed by the Employer pursuant to an
Amended and Restated Executive Employment Agreement, dated September 28, 1999
(the "Employment Agreement");
WHEREAS, Tierney and Employer have concluded that it is in their mutual
best interest for Tierney to terminate his full-time employment by Employer
while remaining an active member of Employer's board of directors, effective
January 1, 2002;
NOW, THEREFORE, in consideration of the mutual covenants set forth
below, it is agreed as follows:
1. Termination of Employment Agreement. Employer and Tierney agree that the
Employment Agreement will terminate on 1/1/02, except as expressly provided
herein.
2. Severance.
(a) Employer shall pay to Tierney the amount of $200,000, subject to
all legally applicable deductions and withholdings, representing Tierney's
salary over a twelve (12) month period, payable beginning within twenty
(20) days of Employer's receipt of a copy of this Agreement executed by
Tierney in accordance with Employer's normal payroll schedule.
(b) In addition, Employer shall pay to Tierney the amount of $100,000,
subject to all legally applicable deductions and withholdings, payable
within twenty (20) days of Employer's receipt of a copy of this Agreement
executed by Tierney.
(c) In addition, Tierney will vest in 100% of all unvested stock
option shares. Unexercised stock option shares will terminate within 90
days of the date Tierney ceases to be a member of Employer's board of
directors, or the termination date listed in the option agreements,
whichever comes first.
(d) All compensation under this Section 2 shall be deemed severance
compensation and shall be in lieu of any compensation and other benefits
payable to Tierney under the Employment Agreement upon or following
termination thereof.
3. Board Membership.
(a) Tierney shall continue as a member of Employer's board of
directors (the "Board") for the remainder of his current term ending May
23. 2002, and Employer currently anticipates his nomination at that time
for reelection to an additional term. Tierney shall
continue to serve as Chairman of the Board until such time as the Board
determines otherwise. So long as Tierney is Chairman of the Board, his
duties shall be as follows:
(i) primary responsibility for strategic positioning;
(ii) speaking and writing on Employer's behalf;
(iii) leadership of Employer public relations effort with the
media;
(iv) acting as mentor and coach to CEO, and influence Employer
through the CEO;
(v) participation in investor relations activities;
(vi) providing support for sales and marketing activities as
requested;
(vii) [strategic positioning of Benu product; and]
(viii) other appropriate duties as requested from time to time by
the Board and CEO
(b) So long as Tierney serves as a director, Employer shall provide
Tierney with a laptop computer, office space, standard office furniture and
telecommunications access for business-related voice and data
communication; and will reimburse Tierney for travel or other necessary and
reasonable expenses Tierney incurs in the course of serving as a director.
In addition, Employer also agrees to provide Tierney with healthcare
benefits with coverage levels similar to the Employer's employee coverage
as long as he serves on the Board, with the understanding that coverage
levels may change from time to time.
(c) On May 23, 2002, Tierney will be granted options pursuant to
Employer's employee stock option plan (the "Plan") to purchase 200,000
shares of Employer's common stock at an exercise price equal to the closing
market price on May 23, 2002; provided that no options will be granted if
prior to May 23, 2002 Tierney resigns from the Board, is removed for cause
or due to disability, or dies, or if the shareholders of Employer fail to
approve an increase in the number of shares of common stock authorized for
grant under the Plan at the May 23, 2002 annual meeting. These options will
vest 1/3 per year at January 1 of 2003, 2004 and 2005. Additional options
may be granted in subsequent years as approved by the Board. Upon a change
of control, or if Tierney leaves his position as a director involuntarily
and is not removed for cause, 100% of the unvested stock options will
immediately vest. However, no accelerated vesting will occur if Tierney
resigns as a director voluntarily or is removed for cause.
(d) Employer will use commercially reasonable efforts to obtain
shareholder approval of an increase in the number of shares of common stock
authorized for grant under the Plan, including inclusion in Employer's
proxy statement for its annual meeting of the proposal to
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increase such authorized shares together with a recommendation that the
increase be approved. In the event that Employer's shareholders fail to
approve an increase in the number of shares of common stock authorized for
grant under the Plan at the May 23, 2002 annual meeting, Employer will
attempt in good faith to provide to Tierney a replacement benefit with
equivalent economic benefits to Tierney, and in any event at least as
favorable to Tierney as any benefits granted to senior management in lieu
of options that otherwise would have been granted under the Plan, or
otherwise pursue a commercially reasonable strategy that permits Employer
to issue the options.
(e) Tierney agrees that Article 6.0 and Section 8.07 of the Employment
Agreement will continue in full force and effect so long as he is a
director of Employer (which shall be your "employment" for purposes of
Section 6.01 thereof) and for two years thereafter notwithstanding the
termination of the Employment Agreement, and Article 6.0 and Section 8.07
of the Employment Agreement are hereby incorporated herein by reference.
(f) If Tierney ceases to be a director of Employer prior to reaching
age 65, other than as a result of his death, removal for cause [or
voluntary resignation], Employer will provide Tierney with COBRA health
insurance coverage at Tierney's expense.
4. Release. Tierney, for himself, his heirs, successors and assigns, hereby
fully and completely releases and waives any and all claims, complaints, rights,
causes of action or demands of whatever kind, whether known or unknown, which he
has or may have against Employer and its predecessors, successors, assigns,
subsidiaries and affiliates and all officers, employees, and agents of those
companies, (hereinafter collectively called "the Released Parties") arising out
of any actions, conduct, promises, decisions, statements, behavior or events
occurring at any time prior to or on the date of this Settlement Agreement.
Tierney understands that this Release specifically covers, but is not limited
to, any and all claims, complaints, causes of action or demands which he has or
may have against the Released Parties relating in any way to the Employment
Agreement, the terms, conditions or circumstances of his employment and his
separation from employment by Employer, whether based on statutory or common law
claims for employment discrimination (including age, sex, sexual orientation,
religion, race, national origin, disability or other discrimination arising
under the Title VII of the Civil Rights Act of 1964, the Americans with
Disabilities Act, the Minnesota Human Rights Act and any other federal, state or
local statute, Executive Order or ordinance prohibiting employment
discrimination), wrongful discharge, breach of contract, breach of any express
or implied promise, misrepresentation, fraud, retaliation, breach of public
policy, infliction of emotional distress, defamation, promissory estoppel,
invasion of privacy, tortuous interference with contract, or any other theory,
whether legal or equitable. This Release does not impair or apply to any
existing vested rights Tierney might have under the terms of any presently
existing employee benefit plans of the Employer applicable to him, under
Workers' Compensation laws, or by reason of this Settlement Agreement and
Release itself. Tierney further agrees that he will not institute any legal
proceedings against the Released Parties as a result of any claims of any kind
or character which Tierney might have against the Released Parties relating in
any way to the Employment
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Agreement, the terms, conditions or circumstances of his employment and his
separation from employment by Employer, or any other fact or matter occurring
prior to the execution of this agreement by Tierney, nor will Tierney authorize
any other party, whether governmental or otherwise, to seek individual remedies
on his behalf with respect to any such claims. Tierney further acknowledges that
he has been provided a full opportunity to review and reflect on the terms of
this Severance Agreement and Release and has had the opportunity to consult with
and obtained the advice of legal counsel of his choice. Tierney has been advised
of his right to rescind this Settlement Agreement and Release within fifteen
(15) calendar days after the date of his signature below. The rescission must be
in writing and delivered to Employer either by hand or mail within the fifteen
(15) days. If delivered by mail, the rescission must be postmarked within the
fifteen (15) day period, properly addressed to Employer at: John J. Davis,
eBenX, 605 North Highway 169, Suite LL, Minneapolis, MN 55441-6465, and sent by
certified mail return receipt requested. If Tierney rescinds this Release in
accordance with the above provisions, then this entire Agreement is null and
void; provided, however, that any such rescission will not affect the
termination of his employment with the Employer, which stands in all events.
5. Miscellaneous.
(a) This Agreement is full and complete, and represents the entire
understanding and agreement between these parties with regard to all
matters contained herein. There are no other agreements, conditions, or
representations, oral or written, express or implied, between these parties
with regard to the subject matter herein. This Agreement can be amended
only in writing, signed by both parties hereto.
(b) The parties have read, considered, and fully understand this
Agreement, have had sufficient time to consider its terms, and execute it
knowingly, freely, and voluntarily. Both parties have had opportunity to
consult with their own independent attorneys or other advisors of their
choice.
(c) The undersigned have each read this Agreement and understand all
the terms fully and enter their signatures in order to signify their
understanding and voluntary agreement with all of the terms and conditions
set forth herein.
Dated: EBENX, INC.
By:
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Its:
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Dated:
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Mark Tierney
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