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EXHIBIT 10.81
EMPLOYMENT AGREEMENT
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This Employment Agreement made this 1st day of April, 1995, ("Agreement")
between Compuware Corporation, its subsidiaries and affiliates, ("Company") and
▇▇▇▇▇▇▇ ▇▇▇▇▇ ("Executive").
Company and Executive hereby agree:
1. EMPLOYMENT AND DUTIES.
1.1 EMPLOYMENT BY COMPANY. Company agrees to employ Executive for the
Employment Term as defined in Section 2, to render exclusive and full-time
services to it in such capacity or capacities as the Company shall determine
from time to time, and to perform faithfully and diligently such duties as the
Company shall reasonably assign to Executive from time to time.
1.2 OUTSIDE ACTIVITIES. Executive shall not engage in business
activities other than those contemplated by Executive's duties for the Company
unless approved in advanced by Company and listed on Exhibit B.
2. TERM OF EMPLOYMENT. The term of Executive's employment under this
Agreement shall commence on the date hereof and shall end on the date listed on
Exhibit A ("Employment Term") and, unless terminated by mutual agreement of the
parties or as otherwise provided in this Agreement at any time before or after
such date, shall be extended for two (2) years automatically from year to year
on such date, provided Executive is not disabled.
3. COMPENSATION.
3.1 COMPENSATION. As compensation for all services to be rendered
pursuant to this Agreement, Company shall pay Executive, during the Employment
Term, a salary at the rate specified in Exhibit A hereto ("Annual Salary"),
payable in accordance with the payroll policies of Company as from time to time
in effect, less such deductions as are required to be withheld by applicable
law, regulation or as is customary for Company employees.
3.2 PARTICIPATION IN EMPLOYEE BENEFITS PLANS. Executive shall be
permitted during the Employment Term, if and to the extent eligible, to
participate in any group life, hospitalization or disability insurance plan,
health program, pension, profit sharing or similar benefit plan of Company which
is from time to time available to the senior executives of Company substantially
on the same terms as apply to such other senior executives of Company. During
the Employment Term,
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Executive shall also be afforded reasonable paid vacation time pursuant to
vacation policies fixed by Company, or as otherwise provided in Exhibit A
hereto.
3.3 EXPENSES. Company shall pay or reimburse Executive for all reasonable
business expenses actually incurred or paid by Executive during the Employment
Term in accordance with its current expense reimbursement policy.
3.4 ADDITIONAL COMPENSATION. In addition to the Annual Salary, Executive
shall be entitled to receive such other benefits, stock options, and
discretionary cash or stock bonuses, as the Board of Directors may from time to
time, in its sole discretion, approve or which are otherwise specifically set
forth in Exhibit A hereto.
4. TERMINATION.
4.1 TERMINATION UPON DEATH. If Executive dies during the Employment Term,
the Employment Term and this Agreement shall automatically terminate, except
that Executive's legal representatives and/or beneficiaries shall be entitled to
receive compensation hereunder at the rate of Executive's Annual Salary as in
effect on the date of his death, for a period ending as provided in Exhibit A
hereto.
4.2 TERMINATION UPON DISABILITY. If during the Employment Term, Executive
shall, by reason of injury or illness, become physically or mentally disabled,
whether totally or partially, so that he or she is unable substantially to
perform his or her services hereunder for a period of twelve consecutive months,
Company may at any time after the last day of the twelfth consecutive month of
disability, by notice to Executive, terminate the Employment Term. The
determination of a disability and the commencement date thereof shall be by the
Board of Directors of Company or, at the election of Executive or the Board, by
two(2) qualified physicians agreed upon by Executive and the Board.
Notwithstanding termination because of disability, Company shall continue to pay
Executive compensation hereunder at the rate of his or her Annual Salary as in
effect on the date of such termination, for a period ending as provided in
Exhibit A hereto. If Executive returns to employment, and within six(6) months,
again becomes disabled, the subsequent disability shall be considered a
continuation of the original disability for determining the twelve month period
of disability. During any period of disability of Executive, the Company's
salary continuation obligation shall be reduced by the amount of any proceeds of
disability insurance received by Executive which is payable pursuant
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to any policy of disability insurance for which the Company has paid or pays the
premium in whole or in part.
4.3 TERMINATION OF EMPLOYMENT TERM FOR CONVENIENCE. Notwithstanding any
provision of this Agreement to the contrary other than the provisions of Section
4.2 relating to disability of Executive, Company reserves the right to terminate
the Employment Term for its convenience. If the Employment Term is terminated
for the convenience of Company, Company shall continue to pay Executive
compensation hereunder at the rate of his Annual Salary as in effect on the date
of termination, for a period ending as provided in Exhibit A hereto.
4.4 TERMINATION OF EMPLOYMENT TERM FOR CAUSE. If Executive (i) materially
breaches affirmative or negative covenants or undertakings contained in this
Agreement, or (ii) materially neglects his duties hereunder; then, in any such
case, Company may at any time by notice pursuant to Section 6.1 to Executive
immediately terminate the Employment Term and Executive shall have no right to
receive any compensation or benefit hereunder after the last day of the month in
which falls the effective date of such notice. For purpose hereof, the phrase
"materially neglects his duties" shall be interpreted by reference to the
standard applicable to executives holding similar positions in businesses
owned by public investors.
4.5 SALARY CONTINUATION. Company's salary continuation obligation under
paragraphs 4.2 and 4.3 shall be reduced by the amount of compensation received
by Executive from any and all employment during the period of Company's salary
obligation.
5. CERTAIN COVENANTS OF EXECUTIVE.
5.1 COVENANTS AGAINST COMPETITION. Executive acknowledges that (i) the
principal business of Company is the development, perfection, commercial
exploitation, marketing, licensing and maintenance of computer software and
provision of technical services in software development and maintenance on a
contract basis; (ii) such business is national and international in scope; and
(iii) Executive's work with Company will bring Executive into close contact with
many confidential affairs of Company not readily available to the public. In
order to induce Company to enter into this Agreement, Executive covenants and
agrees that:
5.1.1 NON-COMPETE. During Executive's Employment Term, and for a period of
one(1) year after the termination of the Employment Term( the "Restricted
Period"), Executive shall not in
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the United States of America or in any foreign country, directly or indirectly,
as an owner, stockholder, partner, associate, agent, employee, consultant,
co-venturer, controlling creditor, owner, or representative, engage in or take
any action in or participate with any person engaged in any business
competitive with that then engaged in by Company; provided, that the
restrictions contained in this Section 5.1.1 shall not apply to any business
activity abandoned or disposed of by Company, or to any activity authorized or
sanctioned in writing by Company; and provided, further, that Executive may
own, directly or indirectly, solely as an investment, securities of any person
which are traded on any national securities exchange or over the counter if
Executive (i) is not a controlling person of, or a member of a group which
controls, such person or (ii) does not, directly or indirectly, own 1% or more
of any class of securities of such person except as described on Exhibit B.
5.1.2 NEW DEVELOPMENTS. During the Employment Term, Executive will
promptly disclose to Company any and all improvements, inventions, discoveries,
innovations, systems, techniques, ideas, processes, programs, enhancements and
other items which were made or conceived by Executive, alone or with others,
("New Developments") which are part of Company's business. Executive further
agrees that all New Developments shall be and remain the exclusive property of
Company and that Executive will, at Company's request, and without additional
compensation, do all lawful things necessary to insure Company's ownership of
such New Developments, including without limitation the assigning and
transferring to Company and its assigns all of Executive's rights, title and
interest in and to such New Developments. All work done for Company by
Executive shall be "work for hire". This includes work performed during normal
business hours and after business hours, whether performed on Company's
premises or elsewhere.
5.1.3 CONFIDENTIAL INFORMATION. During the Employment Term and at all
times thereafter, Executive shall keep secret and retain in strictest
confidence, and shall not use for the benefit of Executive or other persons
except in connection with the business and affairs of Company, all Confidential
Information and Materials of Company. For this purpose, the phrase
"Confidential Information and Materials" refers to all information belonging to
or used by Company, or Company's customers, relating to internal operations,
procedures and policies, business strategies, pricing, billing information,
financial information, personnel information, customer contacts, clients, sales
lists, employee lists, technology, software source codes, programs, costs,
employee compensation, marketing plans, developmental plans, computer programs,
computer systems, inventions,
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developments, and trade secrets of every kind and character. Confidential
Information and Materials shall not include that which is: now in or
subsequently comes into the public domain without breach of this Agreement;
known to Executive prior to the receipt of such information and materials
disclosed by Company, independently developed by Executive; disclosed by
Executive with the prior written approval of Company; disclosed by Company to a
third party without restrictions; or becomes known to Executive without breach
of this Agreement from a third party. Executive shall not disclose such
Confidential Information and Materials to anyone inside or outside of Company,
except as required in the course of performing duties hereunder or with
Company's prior express written consent.
5.1.4 PROPERTY OF COMPANY. All memoranda, notes, lists, records, files
and other documents (and all copies thereof) made or compiled by Executive or
made available to Executive during Executive's employment by Company concerning
the business of Company is and shall be Company's property, the use of which is
available to Executive solely pursuant to a limited non-exclusive license
granted by this Agreement, and shall be delivered to Company promptly upon the
termination of Executive's employment with Company or at any other time upon
request by Company.
5.1.5 EMPLOYEES OF COMPANY. During the Employment Term and the
Restricted Period; Executive shall not, directly or indirectly, knowingly
hire, solicit or encourage to leave the employment of Company any employee of
Company, or hire any person who has left the employment of Company, within one
year of the termination of the Restricted Period except for employees terminated
or laid off by Company.
5.2 RIGHTS AND REMEDIES UPON BREACH. If Executive breaches, or threatens to
commit a breach of, any of the provisions of Section 5.1 ("Restricted
Covenants"), Company shall have the following rights and remedies, each of
which rights and remedies shall be independent of the other and severally
enforceable, and all of which rights and remedies shall be in addition to, and
not in lieu of, any other rights and remedies available to Company under law or
in equity:
5.2.1 SPECIFIC PERFORMANCE. The right and remedy to have Restrictive
Covenants specifically enforced by any court having equity jurisdiction, it
being acknowledged and agreed that any such breach or threatened breach will
cause irreparable injury to Company and that money damages will not provide an
adequate remedy to Company. To facilitate this Section 5.2.1, Executive
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consents to the entry of a temporary restraining order by any court of competent
jurisdiction immediately upon commencement of an action therein without prior
notice to Executive.
5.2.2 ACCOUNTING. The Company shall have the right and remedy to
require Executive to account for and pay over to Company all compensation,
profits, monies, accruals, increments or other benefits (collectively
"Benefits") derived or received by Executive as the result of any transactions
constituting a breach of any of the Restrictive Covenants, and Executive shall
account for and pay over such Benefits to Company.
5.2.3 LIQUIDATED DAMAGES. Executive agrees that it is difficult to
determine a precise dollar amount for the solicitation and hiring of any Company
employee or soliciting any Company customer or account contrary to this
Agreement. As a result, Executive agrees to pay the sum of two Hundred Fifty
Thousand ($250,000.00) Dollars as liquidated damages for each and every employee
of Company solicited and/or hired. Also, Executive agrees to pay the sum of One
Million ($1,000,000.00) Dollars for each and every customer or account solicited
and/or contracted with contrary to this Agreement. Executive agrees that the sum
of $250,000.00 represents Company's cost for recruiting, training, educating and
replacing such employee. Executive further agrees that the sum of $1,000,000.00
represents Company's marketing costs and the cost of developing customer
relations as well as lost revenue. Executive agrees that such liquidated damage
provisions are in addition to Company's remedy of specific performance with
respect to threatened or prospective breaches of Sections 5.1.1 and 5.1.5.
5.3 SEVERABILITY OF COVENANTS. If a court determines that any of the
Restrictive Covenants, or any part thereof, is invalid or unenforceable, the
remainder of the Restrictive Covenants shall not thereby be affected and shall
be given full effect, without regard to the invalid portions.
5.4 BLUE-PENCILLING. If a court of competent jurisdiction construes any
provision of the Restrictive Covenants to be unenforceable because of the
duration of such provision or the area covered thereby, such court shall have
the power to reduce the duration or area of such provision and, in its reduced
terms, such provision shall then be enforceable and shall be enforced.
5.5 ENFORCEABILITY IN JURISIDICTIONS. The parties intend to and hereby
confer jurisdiction to enforce the Restrictive Covenants upon the courts of any
jurisdiction within the geographical scope of the Restrictive Covenants. If the
court of any one or more of such jurisdictions hold the Restrictive Covenants
wholly unenforceable by reason of the breadth of such scope or otherwise, it
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is the intention of the parties that such determination not bar or in any way
affect Company's right to the relief provided above in the courts of any other
jurisdiction within the geographical scope of the Restrictive Covenants, as to
breaches of the Restrictive Covenants in such other respective jurisdictions,
the Restrictive Covenants as they relate to each jurisdiction being, for this
purpose, severable into diverse and independent covenants.
6. OTHER PROVISIONS.
6.1 NOTICES. Any notice or other communication required or which may be
given hereunder shall be in writing and shall be delivered personally, by
facsimile, or sent by express overnight courier, and shall be deemed given when
so delivered personally, sent by facsimile, or sent, as follows (or to such
other address as either party shall designate by notice in writing to the other
in accordance herewith):
(i) if to Company:
Compuware Corporation
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: President
Facsimile Number:(▇▇▇) ▇▇▇-▇▇▇▇
(ii) if to Executive:
▇▇▇▇▇▇▇ ▇▇▇▇▇
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6.2 ENTIRE AGREEMENT. This Agreement contains the entire agreement
between the parties with respect to the subject matter hereof and supersedes all
prior agreements, written or oral, with respect thereto.
6.3 WAIVERS AND AMENDMENTS. This Agreement may be amended, modified,
superseded, canceled or renewed, only by a written agreement between the
parties. Failure or delay by either party to enforce compliance with any term or
condition of this Agreement shall not constitute a waiver of such term or
condition.
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6.4 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Michigan applicable to agreements made
and to be performed entirely within such State. The parties to this Agreement
submit to the personal jurisdiction of the state and federal courts of the
State of Michigan.
6.5 ASSIGNMENT. This Agreement, and Executive's rights and obligations
hereunder, may not be assigned by Executive. Company may assign this Agreement
and its rights, together with its obligations hereunder, 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, provided that the
assignee assumes all obligations of Company hereunder. If assignee does not
assume all the obligations of this Agreement, Company shall fulfill the
obligations of this Agreement.
6.6 TAKE-OVER. This Agreement shall be binding upon any party that
acquires the Company's stock through any take-over action or tender offer.
6.7 COUNTERPARTS. 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.
6.8 HEADINGS. The headings in this Agreement are for reference purposes
only and shall not in any way affect the meaning or interpretation of this
Agreement.
6.9 SURVIVAL. The terms of Sections 4 and 5 shall survive the
termination of this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
COMPUWARE CORPORATION
By: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Its: Executive Vice President
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▇▇▇▇▇▇▇ ▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇▇▇▇▇, Executive
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EXHIBIT A
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TO EMPLOYMENT AGREEMENT DATED AS OF APRIL 1, 1995
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Executive: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Annual Salary: $160,000
Vacation: Standard
Termination Date: March 31, 1997
Salary Continuation:
(a) After Termination for Convenience pursuant to Section 4.3: Payment
of Salary until March 31, 1997.
(b) After Expiration of Employment Term: Salary as of March 31, 1997
to be paid over one (1) year in twelve monthly installments.
Other Additional Compensation:
(a) All stock options granted Executive during his or her employment
shall continue to vest until the expiration of the Employment
Term.
COMPUWARE CORPORATION
By: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Its: Executive Vice President
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▇▇▇▇▇▇▇ ▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇▇▇▇▇, Executive
This Exhibit A is effective April 1, 1995. It may be amended from time to time
by an Exhibit A in similar form bearing a later effective date and the
signatures of Company and Executive.
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EXHIBIT B
TO EMPLOYMENT AGREEMENT DATED AS OF APRIL 1, 1995
Executive: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Approved Outside Activities and Stock Ownership:
COMPUWARE CORPORATION
By: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Its: Executive Vice President
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▇▇▇▇▇▇▇ ▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇▇▇▇▇, Executive
This Exhibit B is effective April 1, 1995. It may be amended from time to time
by an Exhibit B in similar form bearing a later effective date and the
signatures of Company and Executive.
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EXHIBIT A
TO EMPLOYMENT AGREEMENT DATED AS OF APRIL 1, 1995
Executive: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Annual Salary: $180,000
Vacation: Standard
Termination Date: March 31, 1998
Salary Continuation:
(a) After Termination for Convenience pursuant to Section 4.3: Payment
of Salary until March 31, 1998.
(b) After Expiration of Employment Term: Salary as of March 31, 1998,
to be paid over one (1) year in twelve monthly installments.
Other Additional Compensation:
(a) All stock options granted Executive during his or her employment
shall continue to vest until the expiration of the Employment Term.
COMPUWARE CORPORATION
By: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
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Its: Chairman & CEO
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▇▇▇▇▇▇▇ ▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇▇▇▇▇, Executive
This Exhibit A is effective April 1, 1996. It may be amended from time to time
by an Exhibit A in similar form bearing a later effective date and the
signatures of Company and Executive.