EXHIBIT 10.37

 

SEPARATION AGREEMENT AND RELEASE

 

This Separation Agreement and Release (“Agreement”) is entered into by and
between QRS Corporation, its officers, directors, employees, representatives,
agents, attorneys, investors, shareholders, administrators, affiliates,
predecessor and successor corporations and assigns (the “Company”), and Candy
Smith, her heirs, executors, representatives and assigns (“Employee”).

 

WHEREAS, Employee has been employed by the Company;

 

WHEREAS, the Employee’s employment with the Company will terminate on the date
set forth herein;

 

NOW, THEREFORE, in consideration of the mutual promises made herein, the Company
and Employee (collectively referred to as the “Parties”) hereby agree as
follows:

 

1. Termination. The Company and Employee acknowledge and agree that Employee’s
separation from the Company is effective July 31, 2002 (the “Termination Date”).
Until the Termination Date, Employee agrees to perform such duties and
responsibilities as directed by the CEO and President of the Company. The
Company may immediately terminate this Agreement without any further liability
to Employee if Employee: (1) materially breaches any obligation under any
confidential or proprietary information agreements with the Company or violates
her fiduciary duties as an officer of the Company, (2) fails to follow in a
material respect any reasonable policies established on an employee-wide basis
by the Company, (3) engages in willful misconduct having a material detrimental
effect on the Company, or (4) engages in unauthorized activity creating a
material conflict of interest between Employee and the Company after notice and
a reasonable opportunity to refrain from that conduct.

 

2. Consideration. In consideration for Employee’s release of claims set forth
below and other obligations under this Agreement, the Company and Employee agree
as follows:

 

  (a)   Severance Pay in the amount of twelve (12) months of your targeted total
annual compensation, totaling $337,500, less applicable withholdings, payable in
three (3) equal installments of $112,000 as follows: The first installment will
be paid on August 1, 2002; the second installment will be paid on November 1,
2002; the final installment will be paid in February of 2003 during the period
in which the Company typically pays annual employee bonuses.

 

  (b)   If Employee elects COBRA coverage, the Company will pay for the first
twelve (12) months of COBRA coverage.

 

Employee acknowledges and agrees that but for her execution of this Agreement,
she would not otherwise be entitled to the benefits described in paragraph 2(a)
and 2(b) above.

 

3. Stock Option. Employee acknowledges and agrees that any unvested stock
options and/or restricted stock presently issued and outstanding will cease to
vest on Termination Date. Employee agrees that he shall have no further rights
to any shares which remain unvested as of Termination Date.

 

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4. No Other Payments Due. Employee acknowledges and agrees that he/she has
received all salary, accrued vacation, bonuses, or other such sums due to
Employee other than amounts to be paid and benefits provided pursuant to Section
2 of this Agreement. In light of the payment by the Company of all wages due, or
to become due to the Employee, the Parties further acknowledge and agree that
California Labor Code section 206.5 is not applicable to the Parties hereto.
That section provides in pertinent part as follows:

 

No employer shall require the execution of any release of any claim or right on
account of wages due, or to become due, or made as an advance on wages to be
earned, unless payment of such wages has been made.

 

5. Employee Release of Claims. In consideration for the obligations of both
parties under this Agreement, Employee hereby fully and forever releases the
Company from any claim, duty, obligation or cause of action relating to any
matters of any kind, whether known or unknown, suspected or unsuspected, that
he/she may possess arising from any omissions, acts or facts that have occurred
up until and including the Effective Date of this Agreement including, without
limitation:

 

  (a)   any and all claims relating to or arising from Employee’s employment
relationship with the Company and termination of that relationship;

 

  (b)   any and all claims relating to, or arising from, Employee’s right to
purchase, or actual purchase of shares of stock of the Company;

 

  (c)   any and all claims for wrongful discharge of employment; breach of
contract, both express and implied; breach of covenant of good faith and fair
dealing, both express and implied; negligent or intentional infliction of
emotional distress; negligent or intentional misrepresentation; negligent or
intentional interference with contract or prospective economic advantage and
defamation;

 

  (d)   any and all claims for violation of any federal, state or municipal
statute, including, but not limited to, Title VII of the Civil Rights Act of
1964, the Age Discrimination in Employment Act of 1967, and the California Fair
Employment and Housing Act;

 

  (e)   any and all claims arising out of any other laws and regulations
relating to employment or employment discrimination; and any and all claims for
attorney’s fees and costs.

 

Employee agrees that the release set forth in the section shall be and will
remain in effect in all respects as a complete and general release as to the
matters released. This release does not extend to any obligations incurred under
this Agreement nor does it abrogate any rights of Employee pursuant to
California Labor Code section 2802.

 

6. Waiver of Unknown or Future Claims. Employee represents that he/she is not
aware of any claim other than the claims that are released by this Agreement.
Employee

 

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acknowledges that he/she is familiar with the provisions of California Civil
Code section 1542, which provides as follows:

 

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR
SUSPECT TO EXIST IN HIS/HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF
KNOWN BY HIM/HER MUST HAVE MATERIALLY AFFECTED HIS/HER SETTLEMENT WITH DEBTOR.

 

Employee, being aware of such code section, agrees to waive any rights either
party may have thereunder, as well as under any other statute or common law
principles of similar effect.

 

7. Nondisclosure of Confidential and Proprietary Information. Employee agrees
that he/she shall continue to maintain the confidentiality of all confidential
and proprietary information of the Company as provided by the agreement
regarding confidential information and ownership of inventions (the
“Confidentiality Agreement”) between the Company and the Employee. Employee
agrees that at all times hereafter, in accordance with the terms of
Confidentiality Agreement and applicable state and federal law, Employee shall
not divulge, furnish or make available to any party any confidential
information, trade secrets, patents, patent applications, price decisions or
determination, invention, customers, proprietary information or other
intellectual property rights of the Company, until after such time as such
information has become publicly know otherwise than by act of collusion of
Employee. Employee further agrees that for a 12-month period commencing of the
Termination Date, he/she will not solicit, recruit, or induce any employee of
QRS Corporation to terminate or alter his/her employment or consulting
relationship with the Company. Employee further acknowledges and agrees that
he/she has returned or will have returned all the Company’s property and
confidential and proprietary information in his/her possession to the Company as
of the Termination Date.

 

8. Breach of this Agreement. Employee acknowledges that breach of the
confidential and proprietary information provision contained in Section 7 of
this Agreement would cause the Company to sustain irreparable harm from such
breach, and, therefore, Employee agrees that in addition to any other remedies
which the Company may have for any breach of this Agreement or otherwise,
including termination of the Company’s obligations to provide Severance pay and
benefits to employee as described in Section 2 of this Agreement, the Company
shall be entitled to obtain equitable relief including specific performance and
injunctions, restraining Employee from committing or continuing any such
violation of this Agreement.

 

9. Authority. The Company represents and warrants that the undersigned has the
authority to act on behalf of the Company and to bind the Company and all who
may claim through it to the terms and conditions of this Agreement. Employee
represents and warrants that he/she has the capacity to act on his/her own
behalf and on behalf of all who might claim through him to bind them to the
terms and conditions of this Agreement. Each Party warrants and

 

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represents that there are no liens or claims of lien or assignments in law or
equity or otherwise of or against any of the claims or causes of action released
herein.

 

10. No Representation. Each party represents that it has carefully read and
understands the scope and effect of the provisions of this Agreement. Neither
party has relied upon any representations or statements made by the other party
which are not specifically set forth is this Agreement.

 

11. Costs. The Parties shall each bear their own costs, attorneys’ fees and
other fees incurred in connection with this Agreement.

 

12. Severability. In the event that any provision hereof becomes or is declared
by a court of competent jurisdiction to be illegal, unenforceable or void, this
Agreement shall continue in full fore and effect without said provision.

 

13. Arbitration. The Parties shall attempt, to settle all disputes arising in
connection with this Agreement through good faith consultation. In the event no
agreement can be reached on such dispute within fifteen (15) days after
notification in writing by either Party to the other concerning such dispute,
the dispute shall be settled by binding arbitration to be conducted in New York
before the American Arbitration Associate under its National Employment Dispute
Resolution Rules, or by a judge to be mutually agreed upon. The arbitration
decision shall be final, conclusive and binding on both Parties and any
arbitration award or decision may be entered in any court having jurisdiction.
The Parties agree that the prevailing party in any arbitration shall be entitled
to injunctive relief in any court of competent jurisdiction to enforce the
arbitration award. The Parties further agree that the prevailing party in any
such proceeding shall be awarded reasonable attorneys’ fees and costs. The
parties hereby waive any rights they may have to trial by jury in regard to
claims arising out of this Agreement or the enforcement of this Agreement.

 

14. Entire Agreement. This Agreement represents the entire agreement and
understanding between the Company and Employee concerning Employee’s separation
from the Company and supersedes and replaces any and all prior agreements and
understandings concerning Employee’s relationship with the Company and his/her
compensation by the Company other than the Confidentiality Agreement described
above in Section 7.

 

15. No Oral Modification. This Agreement may only be amended in writing signed
by Employee and the Company.

 

16. Governing Law. This Agreement shall be governed by the laws of the State of
California without reference to its conflict of laws provisions.

 

17. Effective Date. This Agreement shall be effective on the eighth day after it
has been signed by the Employee and the Employee has not revoked the Agreement
as provided in Section 21 herein below.

 

18. Counterparts. This Agreement may be executed in counterparts, and each
counterpart shall have the same force and effect as an original and shall
constitute an effective, binding agreement on the part of each of the
undersigned.

 

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19. Assignment. This Agreement may not be assigned by Employee or the Company
without prior written consent of the other party. Notwithstanding the foregoing,
this Agreement may be assigned by the Company to a corporation controlling,
controlled by or under common control with the Company without consent of the
Employee.

 

20. Acknowledgement of Waiver of Claims under ADEA. Employee acknowledges that
he/she is waiving and releasing any rights he/she may have under the Age
Discrimination in Employment Act of 1967 (“ADEA”) and that this waiver and
release is knowing and voluntary. Employee further acknowledges that he/she has
been advised by this writing that (a) he/she should consult with an attorney
prior to executing this Agreement; (b) he/she has up to twenty-one (21) days
within which to consider this Agreement; (c) he/she has seven (7) days following
the execution of this Agreement to revoke the Agreement (the “Revocation
period”); and (d) this Agreement shall not be effective until the Revocation
Period has expired. Notice of revocation shall be made in writing by delivery to
the Chief Executive Officer of the Company within the seven day period provided
for herein.

 

21. Voluntary Execution of Agreement. Employee agrees that he/she is executing
this Agreement voluntarily and without any duress or undue influence, with the
full intent of releasing all claims. Employee acknowledges that:

 

He/she has read this Agreement;

 

He/she has been advised by this writing to consult with legal counsel of his/her
own choice or has voluntarily declined to seek such counsel;

 

He/she understands the terms and consequences of this Agreement and of the
releases it contains; and

 

He/she is fully aware of the legal and binding effect of this Agreement.

 

IN WITNESS WHEREOF, the parties have executed this Agreement on the respective
dates set forth below.

 

QRS CORPORATION

       

By:

 

/s/    FRED RUFFIN for LEONARD R. STEIN

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/s/    CANDY SMITH

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Leonard R Stein

S.V.P., General Counsel & Secretary

         

Candy Smith

Dated:

 

7/3/02

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Dated:

 

7/3/02

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