Exhibit 10.93
EPICOR SOFTWARE
CORPORATION
AMENDED MANAGEMENT RETENTION
AGREEMENT
This Amended Management Retention
Agreement (the “Amended Agreement”) is made and entered
into effective as of March 1, 2007 (the “Effective
Date”), by and between L. George Klaus (the
“Executive”) and Epicor Software Corporation (the
“Company”). Certain capitalized terms used in this
Amended Agreement are defined herein.
RECITALS
WHEREAS, Executive previously
entered into a Management Retention Agreement with the Company
effective May 26, 2006 (the
“Agreement”);
WHEREAS, Executive agrees to enter
into this Amended Agreement which will amend and replace the
Agreement in its entirety; and
NOW, THEREFORE, in consideration of
the mutual covenants and promises set forth herein and for other
good and valuable consideration, the receipt of and sufficiency of
which are hereby acknowledged, Company and the Executive agree as
follows:
1. Definitions . The
following terms referred to in this Amended Agreement shall have
the following meanings:
(a) “ Cause ”
means (i) any act of personal dishonesty taken by Executive in
connection with his responsibilities as an employee which is
intended to result in substantial personal enrichment of Executive;
(ii) Executive’s conviction of a felony which the Board
reasonably believes has had or will have a material detrimental
effect on the Company’s reputation or business; (iii) a
willful act by Executive which constitutes gross misconduct and is
materially injurious to the Company; or (iv) continued willful
violations by Executive of Executive’s obligations to the
Company after there has been delivered to Executive a written
demand for performance from the Company which describes the basis
for the Company’s belief that Executive has not substantially
performed his duties and after Executive has been given at least 10
business days in which to cure the circumstances identified in such
written demand .
(b) “ Change of Control
” means the occurrence of any of the following (i) the
sale, lease, conveyance or other disposition of all or
substantially all of the Company’s assets as an entirety or
substantially as an entirety to any person, entity or group of
persons acting in concert, (ii) any transaction or series of
transactions that results in, or that is in connection with, any
person, entity or group acting in concert (other than existing
affiliates of the Company), acquiring “beneficial
ownership” (as defined in Rule 13d-3 under the Securities
Exchange Act of 1934), directly or indirectly, of such percentage
of the aggregate voting power of all classes of voting equity stock
of the Company as shall exceed fifty percent (50%) of such
aggregate voting power, (iii) a merger or consolidation in
which the Company is not the surviving entity, except for a
transaction, the principal
purpose of which is to change the
state in which the Company is incorporated; or (iv) any
reverse merger in which the Company is a surviving entity but in
which securities possessing more than fifty percent (50%) of
the total combined voting power of the Company’s outstanding
securities are transferred to a person or persons different from
the persons holding those securities immediately prior to such
reverse merger; or (v) a liquidation of the
Company.
(c) “ Disability
” means Executive’s inability due to any physical or
mental condition to perform a substantial portion of his employment
duties to the Company for twenty-four (24) or more consecutive
weeks.
(d) “ Involuntary
Termination ” means, without Executive’s express
written consent, (i) a significant reduction of
Executive’s duties, position or responsibilities relative to
Executive’s CEO duties, position or responsibilities in
effect immediately prior to such reduction, or the removal of
Executive from such position, duties and responsibilities, unless
Executive is provided with comparable duties, position and
responsibilities; (ii) a reduction by the Company of
Executive’s CEO base salary as in effect immediately prior to
such reduction unless such reduction is made pursuant to and
proportionately with any Company policy applicable to
similarly-situated Company executives; (iii) the relocation of
Executive to a facility or a location more than one hundred
(100) miles from his current location; (iv) any purported
termination of Executive’s CEO title by the Company which is
not effected for Cause or for which the grounds relied upon are not
valid; (v) Executive’s death or Disability; or
(vi) the failure of the Company to obtain the assumption of
this Agreement by any successors contemplated in Section 14
below.
(e) “ Retirement
” means Executive’s termination of his employment as
CEO with the Company at the end of the Employment Term, or
voluntarily by Executive prior to the end of the Employment Term
provided that such earlier Retirement as CEO is with the approval
and consent of the Company’s Board and does not arise for
Cause.
(f) “ Approved
Retirement ” means Executive’s Retirement from the
CEO position with the Company where Executive at the time of such
Retirement has substantially completed a successful CEO succession
plan acceptable to the Company’s Board of Directors, which
the Board of Directors will confirm to him by the effective date of
such Retirement.
2. Term of Agreement .
Executive hereby accepts further employment with the Company for a
period beginning on the Effective Date and ending on
January 15, 2009 (“Employment Term”) on the terms
and conditions set forth herein. The parties’ obligations
under sections 7, 8, 9, 10 and 11 of this Agreement continue in
certain respects after Retirement, including Approved Retirement,
or Involuntary Termination without Cause.
3. At-Will Employment . The
Company and Executive acknowledge that Executive’s employment
is and shall continue to be at-will, as defined under applicable
law. If Executive’s employment terminates for any reason,
Executive shall not be entitled to any payments, benefits, damages,
awards or compensation other than as provided by this Agreement, or
as may otherwise be established under the Company’s then
existing employee benefit plans or policies at the time of
termination.
4. Base Salary . During the
Employment Term, the Company will pay Executive a salary at an
annualized rate of $736,403 as compensation for his services (the
“Base Salary”). The Base Salary will be paid
periodically in accordance with the Company’s normal payroll
practices and be subject to the usual, required withholdings. The
Base Salary will not be increased during the Employment Term
without the prior written approval of the Company’s Board of
Directors.
5. Annual Incentive .
Executive will continue to be eligible to receive annual cash bonus
payments under the Company’s cash bonus plan for key
employees as in effect on the Effective Date. The bonus will be
paid on a fiscal year basis based on a performance plan agreed to
between the Executive and the Board of Directors of the
Company.
6. Restricted Stock Grant .
Pursuant to the terms of the Agreement, Executive has been granted
a right to purchase (at par value per share) a total of two hundred
thousand (200,000) shares of restricted Company common stock
for the 2007 fiscal year (the “Restricted Stock
Grant”). The Restricted Stock Grant provides that the
restrictions on the stock shall lift based on achievement of
applicable performance goals during 2007 determined in accordance
with the terms of the performance-based Restricted Stock Purchase
Right Program (the “Program”) approved by the
Company’s Compensation Committee, subject to the
Executive’s continued service to the Company through 2007.
The Restricted Stock Grant is subject to the terms, definitions and
provisions of the Company’s applicable stock incentive plan,
as may be amended from time to time (the “Plan”) and
the restricted stock agreement by and between Executive and the
Company (the “Restricted Stock Agreement”), both of
which documents are incorporated herein by reference.
7. Severance Benefits Upon
Involuntary Termination .
Section 7(i) below governs
severance benefits to be received by Executive upon the occurrence
of an Involuntary Termination at any time during the term of this
Amended Agreement which Involuntary Termination does not occur
within twelve months following a Change of Control.
Section 7(ii) below governs severance benefits to be received
by Executive upon the occurrence of an Involuntary Termination at
any time during the term of this Amended Agreement which
Involuntary Termination does occur within twelve months following a
Change of Control.
(i) Upon the occurrence of an
Involuntary Termination at any time during the term of this Amended
Agreement which Involuntary Termination does not occur within
twelve months following a Change of Control, Executive shall be
entitled to only the following benefits:
(a) An amount equal to twelve
(12) months of Executive’s Base Salary as in effect as
of the date of the Involuntary Termination, to be paid periodically
in accordance with the Company’s normal payroll
policies;
(b) An amount equal to 100% of the
Executive’s target annual bonus as calculated from the
Executive’s bonus plan in effect at the time of the
Executive’s Involuntary Termination; and
(c)(1) Subject to the terms herein,
the Executive, Executive’s spouse and Executive’s
dependents who are participating in Company group medical or dental
plans on the date of Executive’s termination of service, and
each of them, (hereinafter collectively the “Covered
Persons”) shall be entitled to receive for the Coverage
Period (as defined below) continued participation in such Company
plans, as they may be modified by the Company from time to time;
provided, however, that if the Company (A) in its sole
reasonable discretion determines that it cannot reasonably provide
such continued participation, including, without limitation, at a
commercially reasonable rate, or (B) amends its existing
medical and dental plans in a manner that such plans would no
longer provide the Covered Persons with Comparable (as defined
below) medical and dental coverage, then the Company may in its
discretion in the event of (A) and shall in the event of
(B) instead provide to the Covered Persons separate but
Comparable medical and dental coverage as to what the Covered
Persons were receiving on the date of Executive’s termination
of Service. “Comparable” as used herein in connection
with medical and dental coverage means comparable both objectively,
as in quality and extent of care, coverage, co-pays, etc., and
subjectively, such as choice of physicians, accessibility to
specialists and to particular medical facilities, etc. Such
continuing coverage under this Section 7(i)(c)(1) shall be
provided to the Covered Persons at no additional cost to Executive
(or Covered Person’s, as applicable) other than the costs
Executive would have incurred from year to year, were he an
employee, for the following respective “Coverage
Periods”: in the case of Executive, for the remainder of his
lifetime; in the case of Executive’s spouse, for the
remainder of her lifetime or, if earlier, until Executive and
Executive’s Spouse divorce; and in the case of any children
who are Covered Persons until the time such persons reach
(a) eighteen (18) years of age if they do not continue
thereafter as full-time students; or (b) twenty-five
(25) years of age if they do remain fulltime students after
attaining eighteen (18) years of age.
(2) The Company’s obligations
under section 7(i)(c)(1) to provide medical and dental health
coverage to the Covered Persons, or any of them, shall be secondary
to and, as applicable, limited to supplementing as necessary, any
other group or individual medical or dental plan which is or may
become reasonably available to any of the Covered Persons during
the Coverage Period (‘Separate Coverage”). Company and
Executive shall cooperate in identifying and procuring any such
available Separate Coverage and Covered Persons shall notify
Company when any such Separate Coverage for any of the Covered
Persons is available and/or begins or ends. Any such Separate
Coverage available to Covered Persons during the Coverage Period
shall be paid for by Company to the extent that the cost of such
Separate Coverage exceeds the cost that Executive (or
Executive’s spouse or dependents, as applicable) would have
been required to pay Company from year to year, were Executive an
employee, during the Coverage Period. For purposes of clarification
and by way of example only, if at the time of Executive’s
time of termination of service, Executive or Executive’s
spouse are eligible to receive Medicare medical coverage, the
Company’s obligation to Executive or his spouse hereunder
would be to supplement such available Medicare coverage as and if
necessary in order to provide Executive and his spouse with
Comparable medical and dental coverage as to that being received on
the date of Executive’s termination of service. Similarly, if
Executive’s spouse is employed by an entity which makes
Separate Coverage available to Covered Persons, or any of them, the
Company’s obligation to such Covered Persons would be to
supplement, if needed, any such Separate Coverage to in order to
provide such Covered Persons with Comparable
medical and dental coverage as to
what they were receiving on the date of Executive’s
termination of service.
(d) Company shall grant to and
otherwise take any steps necessary to fully transfer to Executive
any and all rights, title, interest and claim that the Company may
have in the Executive’s Golf Course membership
