Transaction Systems Architects Inc. Contracts
Sample Business Contracts
Employment Agreement - Transaction Systems Architects Inc. and Gregory D. Derkacht
Employment Forms
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EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement") is entered into as of this
3rd day of December, 2001, by and between Transaction Systems Architects, Inc.,
a Delaware corporation, ("Employer") and Gregory D. Derkacht ("Employee").
WITNESSETH:
WHEREAS, Employee and Employer desire to enter into this Agreement
pertaining to the terms of the employment of Employee by Employer;
NOW, THEREFORE, in consideration of the mutual covenants and promises
contained herein, and other good and valuable consideration, the receipt of
which is hereby acknowledged, the parties agree as follows:
1. Employment. Employer hereby agrees to employ Employee as President
and Chief Executive Officer ("CEO"), and Employee hereby accepts such employment
by Employer upon the terms and conditions and with such duties as determined by
the Board of Directors of Employer from time to time and which shall be related
or appropriate to the position.
2. Term. The term of employment under this Agreement shall commence on
January 2, 2002, and shall continue for a period of three years thereafter,
unless sooner terminated as hereinafter set forth in Section 6, subject to
certain provisions surviving termination as set forth below. Thereafter this
Agreement and the term of employment pursuant hereto will be automatically
extended for successive one-year terms, unless either party elects to terminate
this Agreement by giving the other party written notice thereof not less than 90
days prior to the end of the then-current term.
3. Duties. Employee shall, during the term hereof:
(a) Execute Duties. Execute the duties attendant to
his position as determined and directed by the Board of
Directors from time to time;
(b) Board Service. Serve as a member of the Employer's Board of
Directors.
(c) Full Efforts and Time. Consistent with the foregoing, Employee
shall devote full business time, energy, and skill to the
businesses of Employer, and to the promotion of Employer's
best interests; provided, however, that this Agreement shall
not preclude Employee from participating in the affairs of any
governmental, educational or other charitable institution,
from engaging in professional speaking and writing activities,
and from serving as a member of the board of directors of
other corporations or entities (subject to the approval by the
Chairman of the Board of Directors of Employer) so long as
such activities do not unreasonably interfere with the
businesses of Employer or conflict with Employee's obligations
under this Agreement.
4. Compensation.
(a) Base. Subject to Section 3(d) above, Employer shall pay
Employee for all services to be performed by Employee during
the term of this Agreement a base salary (the "Base Salary")
at the minimum rate of $300,000 per year, payable in
substantially equal semi-monthly payments in accordance with
Employer's customary practice for other employees, as such
practice may be determined from time to time. The Board of
Directors may increase such Base Salary but not decrease such
Base Salary unless, as a result of a reasonable business
judgment by the Board of Directors of Employer, there is a
prorata across-the-board salary reduction for all executive
level management employees of Employer.
(b) Management Incentive Compensation. In addition to the Base
Salary, Employee shall be entitled to participate in the
Employer's Management Incentive Compensation Program
("MICP"). Employee's "on target" incentive compensation will
be $150,000 per fiscal year prorated quarterly in the
amount of $37,500. The amount of incentive compensation
payable to Employee with respect to a fiscal quarter will
depend on the achievement of certain financial results
achieved by Employer in such fiscal quarter. The Board of
Directors may increase the incentive compensation paid or
payable to Employee pursuant to the MICP, but not decrease
such incentive compensation unless, as a result of a
reasonable business judgment by the Board of Directors of
Employer, there is a prorata across-the-board decrease for
all executive level management employees of Employer. The
terms and conditions of the MICP applicable to Employee
are attached hereto as Exhibit A.
(c) Business Expenses. In addition to the Base Salary set forth
above, Employer agrees that during the term of this Agreement
Employee shall be entitled to reimbursement by Employer for
all reasonable and documented business expenses incurred by
him on Employer's behalf in the course of his employment
hereunder in accordance with Employer's policy concerning the
same.
(d) Board Service. No separate or additional compensation will
be paid to Employee with respect to service on the Board of
Directors.
(e) Stock Options. Employee will receive three stock option grants
from the Employer's existing stock option plans. The first
grant will be in the amount of 100,000 shares and will be made
January 2, 2002. Subject to shareholder approval, the second
and third grants will be in the amount of 200,000 shares each
and will be made February 19, 2002. The terms and conditions
for each of the grants are set forth in separate stock option
agreements. The stock option agreements for each of the grants
are attached hereto as Exhibits B, C and D, respectively.
5. Additional Benefits. Employee and his dependents shall be entitled
to participate in and receive health insurance and other benefits ("Benefit
Plans") under the Employer's Benefit Plans, whether qualified or non-qualified,
subject to and on a basis consistent with the terms, conditions, and overall
administration of such Benefit Plans as provided to similarly situated employees
of Employer, as changed from time to time. Employee shall be entitled to paid
vacation and holidays in accordance with Employer's policies in effect from
time-to-time for its employees.
6. Termination.
(a) Types of Termination.
(i) For Cause by Employer.
The Board of Directors of Employer, upon
written notice to Employee setting forth the
reason for such action, may terminate the
employment of Employee with Employer at any
time for "Cause." For purposes of the
preceding sentence, "Cause" shall be deemed
to exist if the Board of Directors of
Employer, in good faith, determines that the
Employee has engaged in gross and flagrant
non-performance, misconduct or negligence of
his duties or gross and flagrant dishonesty
relating to the business of Employer.
(ii) By Employee Voluntarily. Employee may
terminate his employment voluntarily
hereunder thirty (30) days after providing
Employer written notice setting forth his
intention to do so.
(iii) Death or Disability
of Employee. If Employee's employment is
terminated during the term of this Agreement
due to the death or disability of Employee,
then an amount equal to Employee's Base
Salary (at the rate most recently in effect)
shall be paid through the date of his death
or disability, plus an amount in respect of
any accrued but unused vacation days.
Employee's beneficiaries shall also receive
any insurance benefits under the Benefit
Plans to which Employee or his beneficiaries
are entitled on the date of his death or
disability.
As used in this Agreement, the term
"Disability" shall mean, first, the
definition as set forth in the current
long-term disability policy covering the
Employee, but if no such disability policy
exists, then "Disability" shall mean the
inability of Employee, due to a physical or
mental disability, for a period of sixty
(60) days, whether or not consecutive,
during any one hundred eighty (180) day
period, to perform the services contemplated
under this Agreement .
In the case of the disability or death of
Employee, the Noncompetition and
Confidentiality and other provisions of
Sections 7 and 8 hereof shall remain in
effect.
(iv) Without Cause by Employer. Employer
may terminate the employment of Employee
at any time without cause after providing
Employee with 30 days written notice setting
forth its intention to do so.
(iv) Expiration of Term. The expiration of
this Agreement is by its own term, as set
forth in Section 2.
(b) Compensation on Termination. If Employee is terminated for
cause, death or disability, or voluntarily terminates his employment,
or if this Agreement terminates by its own term, he shall not be
entitled to any compensation following the date of termination as
defined below (the "Termination Date"):
(i) for cause by Employer - immediately upon
notice by Employer;
(ii) for death or disability - upon the date
of such occurrence;
(iii) for voluntary termination - the thirtieth
(30th) day following notice by Employee to
Employer; and
(iv) by its own term - upon the date set forth in
Section 2.
(c) Compensation for Termination Without Cause. In the event
Employee is terminated by Employer without cause, Employer shall pay to
Employee $150,000.
(d) Change in Control Compensation. Employee shall be entitled
to compensation if (i) there is a Change in Control of the Employer
while Employee is still an employee of Employer and (ii) Employee's
employment with Employer is terminated by Employer or by Employee for
Good Reason within two years after the Change in Control as a direct or
indirect result of the Change in Control, but not as a result of (A)
Employee's death or disability, (B) Employee's Retirement, (C)
Employee's termination for Cause by Employer, or (D) Employee's
decision to terminate employment other than for Good Reason ("Change in
Control Compensation"). "Change in Control" is defined in Exhibit E
("Definitions"). The Change in Control Compensation to be paid to
Employee in the event of a Change in Control will be equal to one times
the Base Salary set forth in Section 4 above. The Change in Control
Compensation will be paid within five (5) business days of the Change
in Control.
(e) Other Compensation and Benefits. Other than as provided in
Section 6(a)(iii) hereof, upon termination for any reason, Employee
shall be entitled to receive only that compensation and other benefits
that have vested and that are due and earned as of the Termination
Date, and such payment shall be made to Employee within sixty (60)
days.
(f) Full Satisfaction. The payments to Employee pursuant to
this Agreement shall be in full satisfaction of Employee's
rights to compensation hereunder.
7. Noncompetition, Noninducement, Nonsolicitation.
(a) Employee hereby agrees that commencing on the date of this
Agreement and continuing through 180 days after the termination date
(the "Non-Compete Period"), he shall not singly, jointly, or as a
member, employee, or agent of any partnership or as an officer, agent,
employee, director or stockholder, or investor of any other corporation
or entity, or in any other capacity, which is engaged in a similar
business to that of Employer during the period of non-competition:
(i) solicit, contact and/or service any person,
firm, corporation, partnership, or entity of
any kind whatsoever for purposes which are
competitive to that of Employer, and for
purposes similar to those performed by
Employee for Employer, a client of Employer
for which Employee performed service or had
personal contact with on behalf of Employer
during the last one (1) year of Employee's
employment with Employer; provided, that
Employee shall be able to acquire and hold
up to 1% of the outstanding shares of any
publicly traded stock of any company, and an
unlimited percentage of outstanding shares
in the Employer, its parent, affiliates, or
subsidiaries; and
(ii) directly or indirectly induce or attempt to
induce any person who, during the term of
Employee's employment hereunder, was an
employee, representative or agent of
Employer or any of its affiliates to
terminate his employment with Employer or
any of its affiliates, or to violate the
terms of any agreement between said
employee, representative or agent and
Employer or any of its affiliates.
(b) It is understood and agreed by Employer and Employee that
the time periods of the restrictions set forth in Section 7(a) of this
Agreement are intended by Employer and Employee to be extended by any
time period during which Employee violates the terms and conditions of
Section 7(a). Notwithstanding anything which could be construed to the
contrary, this Section 7(b) is not intended to and shall not be deemed
to permit Employee to violate any term or condition of Section 7(a).
(c) In the event any of the provisions of this Agreement shall
be held to be invalid or unenforceable, the remaining portions thereof
shall nevertheless continue to be valid and enforceable as though the
invalid or unenforceable parts had not been included herein.
(d) Employer and Employee specifically agree that the
provisions of Sections 7, 8, 9, and 10 shall survive the termination of
this Agreement.
(e) Employer and Employee agree that the provisions of this
Section 7 may be waived in whole or in part by mutual agreement in
writing by Employer and Employee.
8. Confidentiality. Without the consent of Employer, Employee will not,
during his Employment or after termination of this Agreement, (a) disclose any
trade secret or proprietary or confidential knowledge or information of Employer
or any affiliate of Employer to any person or entity (other than to Employer or
shareholders, directors, officers or employees of Employer or representatives
thereof), or (b) otherwise make use of any such secret, knowledge or information
for other than Employer's purposes, unless in the case of (a) or (b) above such
secret, knowledge or information is readily ascertainable from publicly
available information. Employee will hold confidential, on behalf of Employer as
the property of Employer, all memoranda, manuals, books, papers, letters,
documents, computer software and other similar property obtained during the
course of performing duties under this Agreement, and will return such property
to Employer at any time upon demand by Employer and, in any event, within three
(3) calendar days after termination of his employment under this Agreement or
after the end of the term of this Agreement.
9. Developments.
(a) As used in this Agreement, the term "Employee
Developments" shall mean all technological, financial, operating and
training ideas, processes, methods and materials, specifically
including, but not limited to, all inventions, discoveries,
improvements, devices, apparatus, designs, practices, processes,
methods, formulas, know-how, products, enhancements and all software,
computer programs (including source code, object code, documentation
and programmer's notes) and other works of authorship, whether or not
patentable or copyrightable, developed, written, conceived or reduced
to practice during Employee's employment by the Company or within a
period of 90 days thereafter (i) which result from any work performed
by Employee for the Employer, or (ii) which relate to the Employer's
business or research or development of the Employer at the time
Employee develops, writes, conceives or reduces to practice any of the
foregoing, alone or with others.
(b) Employee shall promptly disclose all Employee Developments
to the Employer and make available to the Employer any work papers,
drawings, designs, schematics, specifications, descriptions, models,
diskettes, computer tapes, source codes or other tangible incidents of
Employee Developments. Employee agrees that all Employee Developments
shall be considered work made by Employee for the Employer and prepared
within the scope of Employee's employment and that all right, title and
ownership interest in and to the Employee Developments, including,
without limitation, copyright, trade secret, patent or other
intellectual property rights, shall exclusively vest in and be retained
by the Employer, both during and following the term of employment.
Employee agrees to perform upon request of the Employer any acts that
may be necessary or convenient during his term of employment or
thereafter to establish, perfect, evidence, register, transfer, assign
or convey ownership of Employee Developments in or to the Employer, to
the fullest extent possible, including without limitation, assignment
to the Employer of all ownership, copyright, trade secret, patent and
other intellectual property rights without any further consideration.
10. Remedies.
(a) Employer shall be entitled, if it elects, to enjoin any
breach or threatened breach of, or enforce the specific performance of,
the obligations of Employee under Sections 7 and 8, without showing any
actual damage or that monetary damages would be inadequate. Any such
equitable remedy will not be the sole and exclusive remedy for any such
breach, and Employer may pursue other remedies for such a breach.
(b) Any court proceeding to enforce the specific performance
provisions of this Agreement may be commenced in the federal courts
located in the State of Nebraska, or in the absence of federal
jurisdiction, the state courts of Nebraska having jurisdiction.
Employer and Employee submit to the jurisdiction of such courts and
waive any objection which they may have to the pursuit of any such
proceeding in any such court for purposes of specific performance only.
11. Employer Assignment. Employer may assign this Agreement, provided,
however, that in the event of such assignment by the Employer, Employer's
obligations hereunder shall be binding legal obligations and shall inure to the
benefit of any successor.
12. Relocation. Employee agrees to relocate to Omaha, Nebraska, for the
term of this Agreement. Employer will pay for movement of Employee's household
and personal belongings. Employer will pay for real estate commission and other
customary and reasonable closing costs associated with the sale of Employee's
current home in Chicago. Employer will not pay for any fees or costs associated
with the purchase of a home in Omaha. Employer will pay for two house-hunting
trips in Omaha for Employee and spouse. No tax gross-up or equalization
allowances will be provided. Temporary housing in Omaha and related travel to
and from Chicago will be provided and paid for by the Employer while Employees
attempts to sell home in Chicago. Payment by Employer for such expenses will
cease at the earlier of (1) Employee moving into a new residence in Omaha; (2)
closing the sale of Employee's Chicago house; or (3) March 31, 2002.
13. Benefits Unfunded. All rights of Employee and his spouse or other
beneficiary under this Agreement shall at all times be entirely unfunded and no
provision shall at any time be made with respect to segregating any assets of
Employer for payment of any amounts due hereunder. Neither Employee nor his
spouse or other beneficiary shall have any interest in or rights against any
specific assets of Employer.
14. Waiver. No waiver by any party at any time of any breach by any
other party of, or compliance with, any condition or provision of this Agreement
to be performed by any other party shall be deemed a waiver of any other
provisions or conditions at the same time or at any prior or subsequent time.
15. Applicable Law. This Agreement shall be construed and interpreted
pursuant to the laws of the State of Nebraska without giving effect to the
conflict of laws provisions thereof.
16. Entire Agreement. This Agreement contains the entire Agreement
between Employer and Employee and supersedes any and all previous agreements,
written or oral, between the parties relating to the subject matter hereof. No
amendment or modification of the terms of this Agreement shall be binding upon
the parties hereto unless reduced to writing and signed by Employer and
Employee.
17. Counterparts. This Agreement may be executed in counterparts and by
facsimile signatures, each of which shall be deemed an original, and all of
which taken together shall constitute one instrument.
18. Severability. In the event any provision of this Agreement is
held illegal or invalid, the remaining provisions of this Agreement shall not be
affected thereby.
19. Notice. Notices under this Agreement shall be in writing and sent
by registered mail, return receipt requested, to the following addresses or to
such other addresses as the party being notified may have previously furnished
to the others by written notice.
If to Employer or its Board of Directors:
Transaction Systems Architects, Inc.
Attn: Chairman of the Board of Directors
224 South 108th Avenue
Omaha, NE 68154
with a copy to:
Transaction Systems Architects, Inc.
Attn: General Counsel
224 South 108th Avenue
Omaha, Nebraska 68154
If to Employee:
______________________
______________________
______________________
Such notices shall be deemed received three (3) business days after they are so
sent.
IN WITNESS WHEREOF, the parties have executed this Agreement, on the
day and year first above written.
Transaction Systems Architects, Inc.
("Employer")
By: ______________________________
Name: ______________________________
Title: ______________________________
Gregory D. Derkacht
("Employee")
_______________________________________
Attachments:
Exhibit A: Management Incentive Compensation Program
Exhibit B: First Stock Option Grant
Exhibit C: Second Stock Option Grant
Exhibit D: Third Stock Option Grant
Exhibit E: Definitions