EXHIBIT 10.1

 

AMENDED AND RESTATED

EMPLOYMENT AGREEMENT

 

THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (the “Agreement”) by and between
Optio Software, Inc. (“Company”), and C. Wayne Cape (“You” or “Your”)
(collectively referred to as the “Parties”), is entered into and effective as of
the 29th of February, 2008 (the “Effective Date”) and amends and restates that
certain Employment Agreement dated August 1, 2003.(1)

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(1) Unless otherwise indicated, all capitalized terms used in this Agreement are
defined in the “Definitions” section attached as Exhibit A . Exhibit A is
incorporated by reference and is included in the Definition of “Agreement.”

 

WHEREAS, the Company is engaged in the Business;

 

WHEREAS, the Parties entered into that certain Employment Agreement (the
“Original Agreement”) effective as of August 1, 2003;

 

WHEREAS, the Parties desire to amend and restate the Original Agreement in its
entirety as of the Effective Date, upon the terms and conditions set forth
herein;

 

WHEREAS, Your position is a position of trust and responsibility with access to
Confidential Information, Trade Secrets, and information concerning employees
and customers of the Company;

 

WHEREAS, the Trade Secrets and Confidential Information, and the relationship
between the Company and each of its employees and customers are valuable assets
of the Company and may not be converted to Your own use;

 

WHEREAS, the Company has agreed to employ You in exchange for Your compliance
with the terms of this Agreement;

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements set
forth herein, it is agreed:

 

1.        EMPLOYMENT AND DUTIES.

 

A.       COMPANY SHALL CONTINUE TO EMPLOY YOU AS CHIEF EXECUTIVE OFFICER,
PRESIDENT AND CHAIRMAN OF THE BOARD IN ACCORDANCE WITH THE TERMS AND CONDITIONS
SET FORTH IN THIS AGREEMENT. YOU ACCEPT SUCH CONTINUED EMPLOYMENT ON THE TERMS
SET FORTH HEREIN. YOU SHALL REPORT TO THE BOARD OF DIRECTORS OF THE COMPANY.

 

B.        YOU SHALL HAVE SUCH DUTIES AS SET FORTH ON EXHIBIT B (DUTIES) AND AS
MAY OTHERWISE BE ASSIGNED TO YOU BY THE BOARD OF DIRECTORS FROM TIME TO TIME.

 

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C.        YOU AGREE TO DEVOTE ALL NECESSARY WORKING TIME REQUIRED OF YOUR
POSITION, TO DEVOTE YOUR BEST EFFORTS, SKILL, AND ENERGIES TO PROMOTE AND
ADVANCE THE BUSINESS AND/OR INTERESTS OF THE COMPANY, AND TO FULLY PERFORM YOUR
OBLIGATIONS UNDER THIS AGREEMENT. DURING YOUR EMPLOYMENT, YOU SHALL NOT RENDER
SERVICES TO ANY OTHER ENTITY, REGARDLESS OF WHETHER YOU RECEIVE COMPENSATION,
WITHOUT THE PRIOR WRITTEN CONSENT OF THE COMPANY. YOU MAY, HOWEVER, (I) ENGAGE
IN COMMUNITY, CHARITABLE, AND EDUCATIONAL ACTIVITIES, (II) MANAGE YOUR PERSONAL
INVESTMENTS, AND (III) WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY, SERVE ON
CORPORATE BOARDS OR COMMITTEES, PROVIDED THAT SUCH ACTIVITIES DO NOT CONFLICT OR
INTERFERE WITH THE PERFORMANCE OF YOUR OBLIGATIONS UNDER THIS AGREEMENT OR
CONFLICT WITH THE INTERESTS OF THE COMPANY.

 

D.       AS AN OFFICER OF THE COMPANY, YOU OWE A DUTY OF CARE AND LOYALTY TO THE
COMPANY, AS WELL AS A DUTY TO PERFORM YOUR DUTIES IN A MANNER THAT IS IN THE
BEST INTERESTS OF THE COMPANY.

 

E.        YOU AGREE TO COMPLY WITH THE POLICIES AND PROCEDURES OF THE COMPANY AS
MAY BE ADOPTED AND CHANGED FROM TIME TO TIME, INCLUDING THOSE DESCRIBED IN THE
COMPANY’S EMPLOYEE HANDBOOK. MATERIAL CHANGES TO POLICIES AND PROCEDURES MAY BE
MADE FROM TIME TO TIME BY THE BOARD OF DIRECTORS. IF THIS AGREEMENT CONFLICTS
WITH SUCH POLICIES OR PROCEDURES, THIS AGREEMENT WILL CONTROL.

 

2.        COMPENSATION.

 

A.       BASE SALARY.  DURING THE TERM OF THIS AGREEMENT, COMPANY SHALL PAY TO
YOU A BASE SALARY OF $306,860 PER YEAR, INCREASED AS SET FORTH BELOW (BASE
SALARY), SUBJECT TO ALL APPLICABLE WITHHOLDINGS. YOUR BASE SALARY SHALL BE
INCREASED EACH AUGUST 1 IN AN AMOUNT EQUAL TO THE PRODUCT OF THE BASE SALARY (AS
PREVIOUSLY INCREASED) AND THE PERCENTAGE INCREASE, IF ANY, OF THE CONSUMER PRICE
INDEX FOR ALL URBAN CONSUMERS, REGION SOUTH, PUBLISHED BY THE U.S. BUREAU OF
LABOR STATISTICS OVER THE PRIOR YEAR’S CONSUMER PRICE INDEX FOR ALL URBAN
CONSUMERS, REGION SOUTH, PUBLISHED BY THE U.S. BUREAU OF LABOR STATISTICS. IN
ADDITION, YOUR BASE SALARY MAY BE ADJUSTED ANNUALLY AT THE DISCRETION OF THE
BOARD OF DIRECTORS, HOWEVER THESE ADJUSTMENTS MAY ONLY BE INCREASES AND NOT
DECREASES. YOUR BASE SALARY SHALL BE PAID TO YOU IN ACCORDANCE WITH THE
COMPANY’S NORMAL PAYROLL PRACTICES.

 

B.        BONUS.  DURING THE TERM OF THIS AGREEMENT, YOU WILL RECEIVE AN ANNUAL
BONUS IF YOUR PERFORMANCE AND THE COMPANY’S PERFORMANCE MEETS CERTAIN CRITERIA
ESTABLISHED FROM YEAR TO YEAR BY THE COMPANY’S BOARD OF DIRECTORS (THE BONUS).
YOU WILL NOT RECEIVE ANY BONUS IF, DUE TO TERMINATION FOR CAUSE, YOU ARE NOT
EMPLOYED ON THE LAST DAY OF THE YEAR FOR WHICH THE BONUS IS TO BE PAID,
OTHERWISE THE BONUS IS TO BE PRORATED. THE BONUS WILL BE SUBJECT TO ALL
APPLICABLE WITHHOLDINGS AND WILL BE PAID IN ACCORDANCE WITH THE COMPANY’S ANNUAL
BONUS INCENTIVE PLAN. IN THE EVENT OF A CHANGE OF CONTROL, THE COMPANY AND YOUR
INDIVIDUAL PERFORMANCE TARGETS FOR THE ANNUAL BONUS INCENTIVE PLAN SHALL BE
DEEMED TO BE MET IN FULL FOR THE REMAINDER OF THE PLAN YEAR IN WHICH THE CHANGE
OF CONTROL OCCURS. PAYMENT OF SUCH BONUS SHALL BE MADE TO YOU ON THE EARLIER OF
(I) YOUR TERMINATION PURSUANT TO SECTION 5C HEREOF, OR (II) IN ACCORDANCE WITH
THE PAYMENT SCHEDULE SET FORTH IN THE BONUS PLAN.

 

 

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C.        EXECUTIVE BENEFITS.  YOU SHALL BE ENTITLED TO PARTICIPATE IN ALL
BENEFIT PLANS AS SHALL BE IN EFFECT FOR ALL EXECUTIVE LEVEL PERSONNEL OR
APPLICABLE GENERALLY TO EMPLOYEES OF THE COMPANY FROM TIME TO TIME, SUBJECT TO
THE TERMS AND CONDITIONS OF SUCH PLANS AND PROGRAMS.

 

3.        TERM. THIS AGREEMENT SHALL CONTINUE UNTIL TERMINATED BY EITHER PARTY
IN ACCORDANCE WITH SECTION 4 HEREOF.

 

In the event of a Change of Control, Your rights thereafter under this Agreement
shall become permanent, are not terminable, and cannot be affected by any
corporate action without Your consent, except as is provided for in Section 4 of
this Agreement with respect to death or normal retirement, termination by the
Company For Cause, or Your disability. The previous sentence shall not restrict
the Company’s right to terminate this Agreement as provided in the first
paragraph of this Section 3, subject to Section 4 below.

 

4.        TERMINATION. THIS AGREEMENT MAY BE TERMINATED UPON THE OCCURRENCE OF
ANY OF THE FOLLOWING EVENTS:

 

A.       YOUR DEATH, HOWEVER PRORATING OF BONUS (TO THE EXTENT EARNED BY YOU
PRIOR TO YOUR DEATH) WOULD TRANSFER TO YOUR ESTATE;

 

B.        YOUR DISABILITY; “DISABILITY” MEANS YOU ARE EITHER (1) UNABLE TO
ENGAGE IN ANY SUBSTANTIAL GAINFUL ACTIVITY BY REASON OF ANY MEDICALLY
DETERMINABLE PHYSICAL OR MENTAL IMPAIRMENT THAT CAN BE EXPECTED TO RESULT IN
DEATH OR CAN BE EXPECTED TO LAST FOR A CONTINUOUS PERIOD OF NOT LESS THAN 12
MONTHS; OR (2) BY REASON OF ANY MEDICALLY DETERMINABLE PHYSICAL OR MENTAL
IMPAIRMENT THAT CAN BE EXPECTED TO RESULT IN DEATH OR CAN BE EXPECTED TO LAST
FOR A CONTINUOUS PERIOD OF NOT LESS THAN 12 MONTHS, RECEIVING INCOME REPLACEMENT
BENEFITS FOR A PERIOD OF NOT LESS THAN THREE MONTHS UNDER AN ACCIDENT AND HEALTH
PLAN COVERING EMPLOYEES OF THE SERVICE PROVIDER’S EMPLOYER.  YOU WILL BE DEEMED
DISABLED IF DETERMINED TO BE TOTALLY DISABLED BY THE SOCIAL SECURITY
ADMINISTRATION OR RAILROAD RETIREMENT BOARD OR IF DETERMINED TO BE DISABLED IN
ACCORDANCE WITH A DISABILITY INSURANCE PROGRAM, PROVIDED THAT THE DEFINITION OF
DISABILITY APPLIED UNDER SUCH DISABILITY INSURANCE PROGRAM COMPLIES WITH THE
REQUIREMENTS OF THIS SUBSECTION 4B;

 

C.        MUTUAL WRITTEN AGREEMENT BETWEEN YOU AND THE COMPANY AT ANY TIME TO
TERMINATE THIS AGREEMENT;

 

D.       FOR CAUSE, AS DEFINED BELOW,:

 

1.        YOUR MATERIAL BREACH OF THIS AGREEMENT, PROVIDED THAT, IF SUCH BREACH
IS CURABLE, YOU SHALL BE ENTITLED TO WRITTEN NOTICE AND A THIRTY (30) DAY
OPPORTUNITY TO CURE SUCH BREACH;

 

2.        ANY ACT OR OMISSION BY YOU WHICH IS, OR IS LIKELY TO BE, MATERIALLY
INJURIOUS TO THE COMPANY OR THE BUSINESS REPUTATION OF THE COMPANY;

 

 

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3.        YOUR DISHONESTY, FRAUD, MALFEASANCE, GROSS NEGLIGENCE OR MISCONDUCT IN
THE PERFORMANCE OF YOUR DUTIES OR OTHERWISE HAVING AN ADVERSE AFFECT ON THE
COMPANY;

 

4.        YOUR CONTINUED FAILURE TO SATISFACTORILY PERFORM YOUR DUTIES UNDER
THIS AGREEMENT, TO FOLLOW THE DIRECTION (CONSISTENT WITH YOUR DUTIES) OF THE
BOARD OF DIRECTORS, OR TO FOLLOW THE POLICIES, PROCEDURES, AND RULES OF THE
COMPANY, AFTER NOTICE AND A THIRTY (30) DAY OPPORTUNITY TO CURE;

 

5.        YOUR ARREST, INDICTMENT FOR, OR CONVICTION OF, OR YOUR ENTRY OF A PLEA
OF GUILTY OR NO CONTEST TO, A FELONY OR CRIME INVOLVING MORAL TURPITUDE; OR

 

6.        YOUR RESIGNATION FOR OTHER THAN GOOD REASON OR FAILURE TO PERFORM
SERVICES UNDER THIS AGREEMENT.

 

E.        YOUR RESIGNATION FOR GOOD REASON WHICH SHALL EXIST IF THE COMPANY,
WITHOUT YOUR WRITTEN CONSENT, (I) TAKES ANY ACTION WHICH IS INCONSISTENT WITH,
OR RESULTS IN THE REDUCTION OF, YOUR THEN CURRENT TITLE, DUTIES OR
RESPONSIBILITIES, (II) REDUCES YOUR THEN CURRENT BASE SALARY, (III) REDUCES THE
BENEFITS TO WHICH YOU ARE ENTITLED ON THE EFFECTIVE DATE, UNLESS A SIMILAR
REDUCTION IS MADE FOR OTHER EXECUTIVE EMPLOYEES; (IV) REQUIRES YOU TO RELOCATE
MORE THAN SEVENTY-FIVE (75) MILES FROM THE LOCATION OF THE COMPANY’S OFFICES ON
THE EFFECTIVE DATE, OR (V) ENTERS INTO A CHANGE OF CONTROL TRANSACTION AND THE
SUCCESSOR CORPORATION, IF IT IS NOT THE COMPANY, DOES NOT ASSUME (BY LAW OR
CONTRACT) THE OBLIGATIONS OF THE COMPANY HEREUNDER. GOOD REASON SHALL NOT
INCLUDE ANY ISOLATED, INSUBSTANTIAL OR INADVERTENT ACTION THAT (I) IS NOT TAKEN
IN BAD FAITH, AND (II) IS REMEDIED BY THE COMPANY WITHIN THIRTY (30) DAYS OF
RECEIVING NOTICE BY YOU OF SUCH ACTION.

 

F.        UPON GIVING YOU NINETY (90) DAYS WRITTEN NOTICE, TERMINATION OF
EMPLOYMENT BY THE COMPANY AT ANY TIME FOR ANY REASON NOT DEFINED IN SUBSECTIONS
A-E ABOVE.

 

5.        POST TERMINATION PAYMENT OBLIGATIONS.

 

A.       IF THIS AGREEMENT TERMINATES FOR ANY OF THE REASONS SET FORTH IN
SUBSECTIONS 4A, 4C OR 4D OF THIS AGREEMENT, THEN YOU SHALL BE ENTITLED TO
RECEIVE YOUR BASE SALARY THROUGH THE TERMINATION DATE (AS INCREASED BY ANY
RAISES) AND THEREAFTER THE COMPANY SHALL HAVE NO FURTHER OBLIGATIONS UNDER THIS
AGREEMENT, INCLUDING, BUT NOT LIMITED TO, THE OBLIGATION TO PAY YOU ANY PORTION
OF THE BONUS UNDER SECTION 2B, BUT YOU SHALL CONTINUE TO BE BOUND BY SECTIONS
8A, 8B AND 8C, AND ALL OTHER POST-TERMINATION OBLIGATIONS CONTAINED IN THIS
AGREEMENT.

 

B.        EXCEPT AS OTHERWISE PROVIDED IN SUBSECTION 5C, IF APPLICABLE, IF THIS
AGREEMENT TERMINATES FOR ANY OF THE REASONS SET FORTH IN SUBSECTIONS 4E OR 4F OF
THIS AGREEMENT, THEN THE COMPANY SHALL PAY YOU A SEPARATION PAYMENT EQUAL TO
TWELVE (12) MONTHS BASE SALARY IN EFFECT AS OF THE DATE OF TERMINATION (SUBJECT
TO INCREASE PURSUANT TO SECTION 3, INCLUDING INCREASES AFTER THE DATE OF
TERMINATION), PAYABLE OVER A PERIOD OF TWELVE (12) MONTHS BEGINNING ON THE FIRST
DAY OF THE MONTH FOLLOWING THE DATE OF TERMINATION, IN ACCORDANCE WITH THE
COMPANY’S NORMAL PAYROLL PRACTICES, ANY PRORATED BONUS PAYMENTS (TO THE EXTENT
EARNED BY YOU PRIOR TO THE DATE OF YOUR TERMINATION)

 

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PAYABLE IN ACCORDANCE WITH THE COMPANY’S ANNUAL BONUS INCENTIVE PLAN.  IF THIS
AGREEMENT TERMINATES FOR THE REASON SET FORTH IN SUBSECTION 4B OF THIS AGREEMENT
BY REASON OF AN INJURY WHICH OCCURS IN THE COURSE OF THE PERFORMANCE OF YOUR
DUTIES FOR THE COMPANY, THEN THE COMPANY SHALL PAY YOU A SEPARATION PAYMENT
EQUAL TO TWELVE (12) MONTHS BASE SALARY IN EFFECT AS OF THE DATE OF TERMINATION,
LESS THE MONTHLY AMOUNT THAT YOU ARE ENTITLED TO RECEIVE UNDER ANY AND ALL
LONG-TERM AND SHORT-TERM DISABILITY INSURANCE POLICIES, PAYABLE OVER A PERIOD OF
TWELVE (12) MONTHS BEGINNING ON THE FIRST DAY OF THE MONTH FOLLOWING THE DATE OF
TERMINATION, IN ACCORDANCE WITH THE COMPANY’S NORMAL PAYROLL PRACTICES.

 

C.        IF, WITHIN TWELVE (12) MONTHS FOLLOWING A CHANGE OF CONTROL:

 

1.        THE COMPANY OR THE SUCCESSOR ENTITY TO THE COMPANY TERMINATES YOUR
EMPLOYMENT IN THE MANNER DESCRIBED IN SUBSECTION 4F OF THIS AGREEMENT; OR

 

2.        YOU TERMINATE YOUR EMPLOYMENT PURSUANT TO SUBSECTION 4E OF THIS
AGREEMENT, THEN

 

(I)        YOU SHALL RECEIVE A SEPARATION PAYMENT EQUAL TO TWELVE (12) MONTHS
BASE SALARY IN EFFECT AS OF THE DATE OF TERMINATION, PAYABLE OVER A PERIOD OF
TWELVE (12) MONTHS BEGINNING ON THE FIRST DAY OF THE MONTH FOLLOWING THE DATE OF
TERMINATION, IN ACCORDANCE WITH THE COMPANY’S NORMAL PAYROLL PRACTICES;

 

(II)       THE COMPANY SHALL MAINTAIN IN FULL FORCE AND EFFECT AND PAY ALL
RELATED EXPENSES FOR THE CONTINUED BENEFIT OF YOU AND YOUR DEPENDANTS UNTIL THE
EARLIER OF TWELVE (12) MONTHS FOLLOWING YOUR TERMINATION, OR THE DATE YOU ACCEPT
OTHER EMPLOYMENT AND OBTAIN, THE EQUIVALENT OF ALL LIFE, DISABILITY, ACCIDENT,
HEALTH INSURANCE AND OTHER EMPLOYEE BENEFIT PLANS, PROGRAMS, BENEFITS OR
ARRANGEMENTS IN WHICH YOU WERE ENTITLED TO PARTICIPATE IMMEDIATELY PRIOR TO SUCH
DATE PROVIDED THAT YOUR CONTINUED PARTICIPATION IS POSSIBLE UNDER THE GENERAL
TERMS AND PROVISIONS OF SUCH PLANS AND PROGRAMS. NO DEDUCTION FOR ANY EXPENSES
RELATED TO THE BENEFITS DESCRIBED IN THIS SECTION SHALL BE MADE FROM YOUR BASE
SALARY DURING THE PERIOD AFTER TERMINATION FOR WHICH YOU ARE ELIGIBLE FOR SUCH
BENEFITS. IN THE EVENT THAT YOUR PARTICIPATION IN ANY SUCH PLAN OR PROGRAM IS
BARRED, THE COMPANY SHALL ARRANGE TO PROVIDE YOU WITH BENEFITS SUBSTANTIALLY
SIMILAR TO THOSE WHICH YOU WERE ENTITLED TO RECEIVE UNDER SUCH PLANS AND
PROGRAMS IMMEDIATELY PRIOR TO YOUR TERMINATION, PROVIDED THAT ANY REDUCTION OF
BENEFITS WHICH CONSTITUTED A BASIS FOR YOUR TERMINATION OF EMPLOYMENT FOR GOOD
REASON SHALL NOT BE TAKEN INTO ACCOUNT FOR PURPOSES OF DETERMINING YOUR
CONTINUED BENEFITS UNDER THIS SUBSECTION;

 

(III)      YOU SHALL RECEIVE THE CASH BONUS AMOUNT EARNED BY YOU AS THOUGH YOU
AND THE COMPANY MET THE PERFORMANCE OBJECTIVES REQUIRED BY THE BOARD OF
DIRECTORS FOR PAYMENT OF SUCH BONUS AMOUNT FOR THE REMAINDER OF THE PLAN YEAR IN
WHICH THE CHANGE OF CONTROL OCCURS.

 

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D.       AS OF THE EFFECTIVE DATE, YOU HOLD OPTIONS TO PURCHASE 1,000,000 SHARES
OF THE COMPANY’S COMMON STOCK ALL OF WHICH WERE ISSUED OUTSIDE THE COMPANY’S
STOCK INCENTIVE PLAN AND ARE FULLY VESTED AND EXERCISABLE (NON-PLAN OPTIONS).
NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY OR WITHOUT RESPECT TO THE NATURE
OF TERMINATION, THE NON-PLAN OPTIONS HAVE NO EXPIRATION DATE, IN ACCORDANCE WITH
THEIR TERMS.

 

E.        THE COMPANY’S OBLIGATION TO MAKE THE SEPARATION PAYMENTS AS SET FORTH
HEREIN SHALL BE CONDITIONED UPON YOUR:

 

1.        EXECUTION OF A SEPARATION AND RELEASE AGREEMENT IN A FORM PREPARED BY
THE COMPANY WHEREBY YOU RELEASE THE COMPANY FROM ANY AND ALL LIABILITY AND
CLAIMS OF ANY KIND; AND

 

2.        COMPLIANCE WITH THE RESTRICTIVE COVENANTS (SECTIONS 8A, 8B AND 8C) AND
ALL POST-TERMINATION OBLIGATIONS CONTAINED IN THIS AGREEMENT.

 

The Company’s obligation to make the separation payments set forth in this
Section 5 shall terminate immediately upon any breach by You of any
post-termination obligations to which You are subject.

 

6.        SET-OFF.  TO THE EXTENT PERMITTED BY CODE SECTION 409A, IF YOU HAVE
ANY OUTSTANDING OBLIGATIONS TO THE COMPANY AT THE TIME THIS AGREEMENT TERMINATES
FOR ANY REASON, YOU ACKNOWLEDGE THAT THE COMPANY IS AUTHORIZED TO DEDUCT ANY
AMOUNTS OWED TO THE COMPANY FROM YOUR FINAL PAYCHECK AND/OR FROM ANY AMOUNTS
THAT WOULD OTHERWISE BE DUE TO YOU UNDER SECTION 5 ABOVE.

 

7.        BOOKS AND RECORDS.  YOU AGREE THAT ALL FILES, DOCUMENTS, RECORDS,
CUSTOMER LISTS, BOOKS AND OTHER MATERIALS WHICH COME INTO YOUR USE OR POSSESSION
DURING THE TERM OF THIS AGREEMENT AND WHICH ARE IN ANY WAY RELATED TO THE
COMPANY’S BUSINESS SHALL AT ALL TIMES REMAIN THE PROPERTY OF THE COMPANY, AND
THAT UPON REQUEST BY COMPANY OR UPON THE TERMINATION OF THIS AGREEMENT FOR ANY
REASON, YOU SHALL IMMEDIATELY SURRENDER TO COMPANY ALL SUCH PROPERTY AND COPIES
THEREOF.

 

8.        RESTRICTIVE COVENANTS.  YOU ACKNOWLEDGE THAT THE RESTRICTIONS
CONTAINED IN THIS SECTION 8 ARE REASONABLE AND NECESSARY TO PROTECT THE
LEGITIMATE BUSINESS INTERESTS OF THE COMPANY, AND WILL NOT IMPAIR OR INFRINGE
UPON YOUR RIGHT TO WORK OR EARN A LIVING AFTER YOUR EMPLOYMENT WITH THE COMPANY
ENDS.

 

A.       TRADE SECRETS AND CONFIDENTIAL INFORMATION.  YOU REPRESENT AND WARRANT
THAT: (I) YOU ARE NOT SUBJECT TO ANY AGREEMENT THAT WOULD PREVENT YOU FROM
PERFORMING YOUR DUTIES FOR THE COMPANY OR OTHERWISE COMPLYING WITH THIS
AGREEMENT, AND (II) YOU ARE NOT SUBJECT TO OR IN BREACH OF ANY NON-DISCLOSURE
AGREEMENT, INCLUDING ANY AGREEMENT CONCERNING TRADE SECRETS OR CONFIDENTIAL
INFORMATION OWNED BY ANY OTHER PARTY.

 

You agree that You will not: (i) use, disclose, or reverse engineer the Trade
Secrets or the Confidential Information, except as authorized by the Company;
(ii) during Your employment with the Company, use, disclose, or reverse engineer
(a) any confidential information or trade secrets of any former employer or
third party, or (b) any

 

 

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works of authorship developed in whole or in part by You during any former
employment or for any other party, unless authorized in writing by the former
employer or third party; or (iii) upon Your resignation or termination
(a) retain Trade Secrets or Confidential Information, including any copies
existing in any form (including electronic form), which are in Your possession
or control, or (b) destroy, delete, or alter the Trade Secrets or Confidential
Information without the Company’s consent.

 

The obligations under this Section 8A shall: (i) with regard to the Trade
Secrets, remain in effect as long as the information constitutes a trade secret
under applicable law, and (ii) with regard to the Confidential Information,
remain in effect during the Restricted Period.

 

B.        NON-SOLICITATION OF CUSTOMERS. DURING THE RESTRICTED PERIOD, YOU WILL
NOT SOLICIT ANY CUSTOMER OF THE COMPANY FOR THE PURPOSE OF PROVIDING ANY GOODS
OR SERVICES COMPETITIVE WITH THE BUSINESS. THE RESTRICTIONS SET FORTH IN THIS
SECTION 8B APPLY ONLY TO THE CUSTOMERS WITH WHOM YOU HAD CONTACT.

 

C.        NON-RECRUIT OF EMPLOYEES. DURING THE RESTRICTED PERIOD, YOU WILL NOT,
DIRECTLY OR INDIRECTLY, SOLICIT, RECRUIT OR INDUCE ANY EMPLOYEE TO (A) TERMINATE
HIS OR HER EMPLOYMENT RELATIONSHIP WITH THE COMPANY OR (B) WORK FOR ANY OTHER
PERSON OR ENTITY ENGAGED IN THE BUSINESS.

 

9.        WORK PRODUCT. YOUR EMPLOYMENT DUTIES MAY INCLUDE INVENTING IN AREAS
DIRECTLY OR INDIRECTLY RELATED TO THE BUSINESS OF THE COMPANY OR TO A LINE OF
BUSINESS THAT THE COMPANY MAY REASONABLY BE INTERESTED IN PURSUING. ALL WORK
PRODUCT SHALL CONSTITUTE WORK MADE FOR HIRE. IF (I) ANY OF THE WORK PRODUCT MAY
NOT BE CONSIDERED WORK MADE FOR HIRE, OR (II) OWNERSHIP OF ALL RIGHT, TITLE, AND
INTEREST TO THE LEGAL RIGHTS IN AND TO THE WORK PRODUCT WILL NOT VEST
EXCLUSIVELY IN THE COMPANY, THEN, WITHOUT FURTHER CONSIDERATION, YOU ASSIGN ALL
PRESENTLY-EXISTING WORK PRODUCT TO THE COMPANY, AND AGREE TO ASSIGN, AND
AUTOMATICALLY ASSIGN, ALL FUTURE WORK PRODUCT TO THE COMPANY.

 

The Company will have the right to obtain and hold in its own name copyrights,
patents, design registrations, proprietary database rights, trademarks, rights
of publicity, and any other protection available in the Work Product. At the
Company’s request, You agree to perform, during or after Your employment with
the Company, any acts to transfer, perfect and defend the Company’s ownership of
the Work Product, including, but not limited to: (i) executing all documents
(including a formal assignment to the Company) necessary for filing an
application or registration for protection of the Work Product (an Application),
(ii) explaining the nature of the Work Product to persons designated by the
Company, (iii) reviewing Applications and other related papers, or
(iv) providing any other assistance reasonably required for the orderly
prosecution of Applications.

 

You agree to provide the Company with a written description of any Work Product
in which You are involved (solely or jointly with others) and the circumstances
surrounding the creation of such Work Product.

 

 

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10.      LICENSE. YOU GRANT TO THE COMPANY AN IRREVOCABLE, NONEXCLUSIVE,
WORLDWIDE, ROYALTY-FREE LICENSE TO: (I) MAKE, USE, SELL, COPY, PERFORM, DISPLAY,
DISTRIBUTE, OR OTHERWISE UTILIZE COPIES OF THE LICENSED MATERIALS, (II) PREPARE,
USE AND DISTRIBUTE DERIVATIVE WORKS BASED UPON THE LICENSED MATERIALS, AND
(II) AUTHORIZE OTHERS TO DO THE SAME. YOU SHALL NOTIFY THE COMPANY IN WRITING OF
ANY LICENSED MATERIALS YOU DELIVER TO THE COMPANY.

 

11.      RELEASE. YOU CONSENT TO THE COMPANY’S USE OF YOUR IMAGE, LIKENESS,
VOICE, OR OTHER CHARACTERISTICS IN THE COMPANY’S PRODUCTS OR SERVICES. YOU
RELEASE THE COMPANY FROM ANY CLAIMS WHICH YOU HAVE OR MAY HAVE FOR RIGHT OF
PUBLICITY, COPYRIGHT INFRINGEMENT, OR ANY OTHER CAUSES OF ACTION ARISING OUT OF
THE USE, DISTRIBUTION, ADAPTATION, REPRODUCTION, BROADCAST, OR EXHIBITION OF
SUCH CHARACTERISTICS.

 

12.      POST-EMPLOYMENT DISCLOSURE. DURING THE RESTRICTED PERIOD, YOU WILL
DISCLOSE THAT YOU HAVE COVENANTS (AND THE NATURE OF THOSE COVENANTS) TO PERSONS
AND/OR ENTITIES TO WHOM YOU PROVIDE GOODS AND SERVICES. IF, DURING THE
RESTRICTED PERIOD, YOU PROVIDE SERVICES TO ANOTHER PERSON OR ENTITY WHICH
PROVIDES GOODS OR SERVICES COMPETITIVE WITH THE GOODS OR SERVICES PROVIDED BY
THE COMPANY YOU SHALL PROVIDE THE COMPANY WITH SUCH PERSON OR ENTITY’S NAME,
YOUR JOB TITLE, AND A DESCRIPTION OF THE SERVICES YOU WILL PROVIDE.

 

13.      INJUNCTIVE RELIEF. YOU AGREE THAT IF YOU BREACH SECTIONS 8, 9, 10
AND/OR 11 OF THIS AGREEMENT: (I) THE COMPANY WOULD SUFFER IRREPARABLE HARM;
(II) IT WOULD BE DIFFICULT TO DETERMINE DAMAGES, AND MONEY DAMAGES ALONE WOULD
BE AN INADEQUATE REMEDY FOR THE INJURIES SUFFERED BY THE COMPANY, AND (III) IF
THE COMPANY SEEKS INJUNCTIVE RELIEF TO ENFORCE THIS AGREEMENT, YOU WILL WAIVE
AND WILL NOT (A) ASSERT ANY DEFENSE THAT THE COMPANY HAS AN ADEQUATE REMEDY AT
LAW WITH RESPECT TO THE BREACH, OR (B) REQUIRE THAT THE COMPANY SUBMIT PROOF OF
THE ECONOMIC VALUE OF ANY TRADE SECRET OR CONFIDENTIAL INFORMATION. NOTHING
CONTAINED IN THIS AGREEMENT SHALL LIMIT THE COMPANY’S RIGHT TO ANY OTHER
REMEDIES AT LAW OR IN EQUITY.

 

14.      APPLICATION OF SECTION 409A OF THE CODE.

 

A.       TO THE EXTENT APPLICABLE, IT IS INTENDED THAT THIS AGREEMENT COMPLY
WITH THE PROVISIONS OF SECTION 409A OF THE CODE, SO AS TO PREVENT INCLUSION IN
GROSS INCOME OF ANY AMOUNTS PAYABLE OR BENEFITS PROVIDED HEREUNDER IN A TAXABLE
YEAR THAT IS PRIOR TO THE TAXABLE YEAR OR YEARS IN WHICH SUCH AMOUNTS OR
BENEFITS WOULD OTHERWISE ACTUALLY BE DISTRIBUTED, PROVIDED OR OTHERWISE MADE
AVAILABLE TO YOU.  THIS AGREEMENT SHALL BE CONSTRUED, ADMINISTERED, AND GOVERNED
IN A MANNER CONSISTENT WITH THIS INTENT AND THE FOLLOWING PROVISIONS OF THIS
SECTION SHALL CONTROL OVER ANY CONTRARY PROVISIONS OF THIS AGREEMENT.

 

B.        IN THE EVENT YOU ARE A “SPECIFIED EMPLOYEE” WITHIN THE MEANING OF
SECTION 409A(A)(2)(B)(I) OF THE CODE AND DELAYED PAYMENT OF ANY AMOUNT OR
COMMENCEMENT OF ANY BENEFIT UNDER THIS AGREEMENT IS REQUIRED TO AVOID A
PROHIBITED DISTRIBUTION UNDER SECTION 409A(A)(2) OF THE CODE, THEN (I) AMOUNTS
PAYABLE IN CONNECTION WITH YOUR TERMINATION OF EMPLOYMENT WILL BE DELAYED AND
PAID IN A SINGLE LUMP SUM SIX MONTHS THEREAFTER (OR IF EARLIER, THE DATE OF YOUR
DEATH) AND (II) WITH RESPECT TO MEDICAL AND WELFARE BENEFITS, YOU SHALL BE
ENTITLED TO BEAR THE COST OF SUCH BENEFITS FOR SIX MONTHS FOLLOWING SUCH
TERMINATION DATE, AFTER WHICH TIME THE COMPANY SHALL CONTINUE TO PROVIDE

 

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SUCH BENEFITS FOR THE PERIOD THEY WOULD OTHERWISE HAVE BEEN PROVIDED, COMMENCING
FROM THE SIX MONTH ANNIVERSARY OF THE YOUR TERMINATION DATE.

 

C.        PAYMENTS AND BENEFITS HEREUNDER UPON YOUR TERMINATION OR SEVERANCE OF
EMPLOYMENT WITH THE COMPANY THAT CONSTITUTE DEFERRED COMPENSATION UNDER CODE
SECTION 409A SHALL BE PAID OR PROVIDED ONLY AT THE TIME OF A TERMINATION OF YOUR
EMPLOYMENT WHICH CONSTITUTES A “SEPARATION FROM SERVICE” WITHIN THE MEANING OF
CODE SECTION 409A (SUBJECT TO A POSSIBLE SIX-MONTH DELAY PURSUANT TO THE
SUBSECTION B ABOVE).

 

D.       FOR PURPOSES OF CODE SECTION 409A, THE RIGHT TO A SERIES OF PAYMENTS
UNDER THIS AGREEMENT SHALL BE TREATED AS A RIGHT TO A SERIES OF SEPARATE
PAYMENTS SO THAT EACH PAYMENT HEREUNDER IS DESIGNATED AS A SEPARATE PAYMENT FOR
PURPOSES OF CODE SECTION 409A.

 

E.        ALL REIMBURSEMENTS AND IN KIND BENEFITS PROVIDED UNDER THIS AGREEMENT,
SHALL BE MADE OR PROVIDED IN ACCORDANCE WITH THE REQUIREMENTS OF CODE
SECTION 409A, INCLUDING, WHERE APPLICABLE, THE REQUIREMENT THAT (I) ANY
REIMBURSEMENT IS FOR EXPENSES INCURRED DURING YOUR LIFETIME (OR DURING A SHORTER
PERIOD OF TIME SPECIFIED IN THIS AGREEMENT), (II) THE AMOUNT OF EXPENSES
ELIGIBLE FOR REIMBURSEMENT, OR IN KIND BENEFITS PROVIDED, DURING A CALENDAR YEAR
MAY NOT AFFECT THE EXPENSES ELIGIBLE FOR REIMBURSEMENT, OR IN KIND BENEFITS TO
BE PROVIDED, IN ANY OTHER CALENDAR YEAR, (III) THE REIMBURSEMENT OF AN ELIGIBLE
EXPENSE WILL BE MADE ON OR BEFORE THE LAST DAY OF THE CALENDAR YEAR FOLLOWING
THE YEAR IN WHICH THE EXPENSE IS INCURRED, AND (IV) THE RIGHT TO REIMBURSEMENT
OR IN KIND BENEFITS IS NOT SUBJECT TO LIQUIDATION OR EXCHANGE FOR ANOTHER
BENEFIT.

 

F.        REFERENCES IN THIS AGREEMENT TO CODE SECTION 409A INCLUDE BOTH THAT
SECTION OF THE CODE ITSELF AND ANY GUIDANCE PROMULGATED THEREUNDER.

 

15.      SEVERABILITY. THE PROVISIONS OF THIS AGREEMENT ARE SEVERABLE. IF ANY
PROVISION IS DETERMINED TO BE INVALID, ILLEGAL, OR UNENFORCEABLE, IN WHOLE OR IN
PART, THE REMAINING PROVISIONS AND ANY PARTIALLY ENFORCEABLE PROVISIONS SHALL
REMAIN IN FULL FORCE AND EFFECT.

 

16.      ATTORNEYS’ FEES. IN THE EVENT OF LITIGATION RELATING TO THIS AGREEMENT,
THE PREVAILING PARTY SHALL BE ENTITLED TO RECOVER ATTORNEYS’ FEES AND COSTS OF
LITIGATION IN ADDITION TO ALL OTHER REMEDIES AVAILABLE AT LAW OR IN EQUITY.

 

17.      ARBITRATION WITH RESPECT TO CERTAIN MATTERS. THE PARTIES AGREE TO
SUBMIT TO ARBITRATION, IN ACCORDANCE WITH THESE PROVISIONS, ANY CLAIM OR
CONTROVERSY ARISING FROM OR RELATED TO THE ALLEGED BREACH OF THIS AGREEMENT,
PROVIDED THAT CLAIMS OR DISPUTES OF THE TYPES DESCRIBED IN SECTION 13 ABOVE
SHALL NOT BE SUBJECT TO THIS SECTION 16. THE PARTIES FURTHER AGREE THAT, OTHER
THAN WITH RESPECT TO CLAIMS OR DISPUTES OF THE TYPES DESCRIBED IN SECTION 13
ABOVE, THE ARBITRATION PROCESS AGREED UPON HEREIN SHALL BE THE EXCLUSIVE MEANS
FOR RESOLVING ALL DISPUTES MADE SUBJECT TO ARBITRATION HEREIN, BUT THAT NO
ARBITRATOR SHALL HAVE AUTHORITY TO EXPAND THE SCOPE OF THESE ARBITRATION
PROVISIONS. ANY ARBITRATION HEREUNDER SHALL BE CONDUCTED UNDER THE MODEL
EMPLOYMENT PROCEDURES OF THE AMERICAN ARBITRATION ASSOCIATION (AAA) AND THE
PARTIES AGREE THAT THE FEDERAL ARBITRATION ACT SHALL GOVERN THE PROCEEDINGS.
EITHER PARTY MAY INVOKE ARBITRATION PROCEDURES HEREIN BY WRITTEN NOTICE FOR
ARBITRATION CONTAINING A STATEMENT OF THE MATTER TO BE

 

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ARBITRATED. THE PARTIES SHALL THEN HAVE FOURTEEN (14) DAYS IN WHICH THEY MAY
IDENTIFY A MUTUALLY AGREEABLE, NEUTRAL ARBITRATOR. AFTER THE FOURTEEN (14) DAY
PERIOD HAS EXPIRED, THE PARTIES SHALL PREPARE AND SUBMIT TO THE AAA A JOINT
SUBMISSION, WITH EACH PARTY TO CONTRIBUTE HALF OF THE APPROPRIATE ADMINISTRATIVE
FEE. IN THE EVENT THE PARTIES CANNOT AGREE UPON A NEUTRAL ARBITRATOR WITHIN
FOURTEEN (14) DAYS AFTER WRITTEN NOTICE FOR ARBITRATION IS RECEIVED, THEIR JOINT
SUBMISSION TO THE AAA SHALL REQUEST A PANEL OF NINE ARBITRATORS WHO ARE
PRACTICING ATTORNEYS WITH PROFESSIONAL EXPERIENCE IN THE FIELD OF EMPLOYMENT
LAW, AND THE PARTIES SHALL ATTEMPT TO SELECT AN ARBITRATOR FROM THE PANEL
ACCORDING TO AAA PROCEDURES. UNLESS OTHERWISE AGREED BY THE PARTIES, THE
ARBITRATION HEARING SHALL TAKE PLACE IN ATLANTA, GEORGIA AT A PLACE DESIGNATED
BY THE AAA. ALL ARBITRATION PROCEDURES HEREUNDER SHALL BE CONFIDENTIAL. THE
ARBITRATOR SHALL HAVE AUTHORITY TO INCLUDE ALL OR ANY PORTION OF COSTS OF SUCH
ARBITRATION IN AN AWARD. THE ARBITRATOR SHALL NOT HAVE THE POWER OR AUTHORITY TO
AWARD INDIRECT, SPECIAL, INCIDENTAL, CONSEQUENTIAL, EXEMPLARY, OR PUNITIVE
DAMAGES. THE ARBITRATOR MAY INCLUDE EQUITABLE RELIEF. ANY ARBITRATION AWARDED
SHALL BE ACCOMPANIED BY A WRITTEN STATEMENT CONTAINING A SUMMARY OF THE ISSUES
IN CONTROVERSY, A DESCRIPTION OF THE AWARD, AND AN EXPLANATION OF THE REASONS
FOR THE AWARD. IT IS UNDERSTOOD AND AGREED BY THE PARTIES THAT THEIR AGREEMENTS
HEREIN CONCERNING ARBITRATION DO NOT OTHERWISE ALTER THE TERMS AND CONDITIONS OF
EMPLOYEE’S EMPLOYMENT AS PROVIDED BY THIS AGREEMENT.

 

18.      WAIVER. ANY PARTY’S FAILURE TO ENFORCE ANY PROVISION OF THIS AGREEMENT
SHALL NOT ACT AS A WAIVER OF THAT OR ANY OTHER PROVISION. ANY PARTY’S WAIVER OF
ANY BREACH OF THIS AGREEMENT SHALL NOT ACT AS A WAIVER OF ANY OTHER BREACH.

 

19.      ENTIRE AGREEMENT. THIS AGREEMENT, INCLUDING EXHIBITS A AND B WHICH ARE
INCORPORATED BY REFERENCE, CONSTITUTES THE ENTIRE AGREEMENT BETWEEN THE PARTIES
CONCERNING THE SUBJECT MATTER OF THIS AGREEMENT. THIS AGREEMENT SUPERSEDES ANY
PRIOR COMMUNICATIONS, AGREEMENTS OR UNDERSTANDINGS, WHETHER ORAL OR WRITTEN,
BETWEEN THE PARTIES RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT. OTHER THAN
TERMS OF THIS AGREEMENT, NO OTHER REPRESENTATION, PROMISE OR AGREEMENT HAS BEEN
MADE WITH YOU TO CAUSE YOU TO SIGN THIS AGREEMENT.

 

20.      AMENDMENTS. THIS AGREEMENT MAY NOT BE AMENDED OR MODIFIED EXCEPT IN
WRITING SIGNED BY BOTH PARTIES.

 

21.      SURVIVAL; SUCCESSORS AND ASSIGNS. THIS AGREEMENT SHALL BE ASSIGNABLE
TO, AND SHALL INURE TO THE BENEFIT OF, THE COMPANY’S SUCCESSORS AND ASSIGNS,
INCLUDING, WITHOUT LIMITATION, SUCCESSORS THROUGH MERGER, NAME CHANGE,
CONSOLIDATION, OR SALE OF A MAJORITY OF THE COMPANY’S STOCK OR ASSETS, AND SHALL
BE BINDING UPON YOU. A CHANGE OF CONTROL SHALL NOT AFFECT THE TERMS OF THIS
AGREEMENT. AS USED IN THIS AGREEMENT, COMPANY SHALL MEAN THE COMPANY AS
HEREINBEFORE DEFINED AND ANY SUCCESSOR TO ITS BUSINESS AND/OR ASSETS AS
AFORESAID OR OTHERWISE. YOU SHALL NOT HAVE THE RIGHT TO ASSIGN YOUR RIGHTS OR
OBLIGATIONS UNDER THIS AGREEMENT. THE COVENANTS CONTAINED IN SECTIONS 8A, 8B AND
8C OF THIS AGREEMENT SHALL SURVIVE CESSATION OF YOUR EMPLOYMENT WITH THE
COMPANY, REGARDLESS OF THE REASON FOR CESSATION OF YOUR EMPLOYMENT AND
REGARDLESS OF WHO CAUSES THE CESSATION.

 

22.      GOVERNING LAW. THE LAWS OF THE STATE OF GEORGIA SHALL GOVERN THIS
AGREEMENT. IF GEORGIA’S CONFLICT OF LAW RULES WOULD APPLY ANOTHER STATE’S LAWS,
THE PARTIES AGREE THAT GEORGIA LAW SHALL STILL GOVERN.

 

10

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23.      NO STRICT CONSTRUCTION. IF THERE IS A DISPUTE ABOUT THE LANGUAGE OF
THIS AGREEMENT, THE FACT THAT ONE PARTY DRAFTED THE AGREEMENT SHALL NOT BE USED
IN ITS INTERPRETATION.

 

24.      NOTICE. WHENEVER ANY NOTICE IS REQUIRED, IT SHALL BE GIVEN IN WRITING
ADDRESSED AS FOLLOWS:

 

To Company:

 

Optio Software, Inc.

3015 Windward Plaza

Windward Fairways II

Alpharetta, Georgia 30005

Attn: Board of Directors

 

To Executive:

 

C. Wayne Cape

545 Brightmore Downs

Alpharetta, GA 30005

 

Notice shall be deemed given and effective three (3) days after the deposit in
the U.S. mail of a writing addressed as above and sent first class mail,
certified, return receipt requested, or when actually received. Either Party may
change the address for notice by notifying the other party of such change in
accordance with this Section.

 

25.      CONSENT TO JURISDICTION AND VENUE. YOU AGREE THAT ANY CLAIM ARISING OUT
OF OR RELATING TO THIS AGREEMENT SHALL BE (I) BROUGHT IN THE SUPERIOR COURT OF
FULTON COUNTY, GEORGIA, OR (II) BROUGHT IN OR REMOVED TO THE UNITED STATES
DISTRICT COURT FOR THE NORTHERN DISTRICT OF GEORGIA, ATLANTA DIVISION. YOU
CONSENT TO THE PERSONAL JURISDICTION OF THE COURTS IDENTIFIED ABOVE. YOU WAIVE
(I) ANY OBJECTION TO JURISDICTION OR VENUE, OR (II) ANY DEFENSE CLAIMING LACK OF
JURISDICTION OR IMPROPER VENUE, IN ANY ACTION BROUGHT IN SUCH COURTS.

 

26.      AFFIRMATION. YOU ACKNOWLEDGE THAT YOU HAVE CAREFULLY READ THIS
AGREEMENT, YOU KNOW AND UNDERSTAND ITS TERMS AND CONDITIONS, AND YOU HAVE HAD
THE OPPORTUNITY TO ASK THE COMPANY ANY QUESTIONS YOU MAY HAVE HAD PRIOR TO
SIGNING THIS AGREEMENT.

 

IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the
day and year first above written.

 

 

 OPTIO SOFTWARE , INC .:

 

 

 

 

By:

 

 

 

/s/ Caroline Bembry

 

Its:

CFO

 

 

 

By:

 

 

 

/s/ C. Wayne Cape

 

 

C. Wayne Cape

 

 

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EXHIBIT A

 

DEFINITIONS

 

A.            “Business” shall mean the business of (i) developing and providing
software that enables a business to integrate and present information to its
customers, suppliers, partners, and employees through various types of media
(including, but not limited to, print, Internet, e-mail and fax) by customizing,
delivering and exchanging information over a computer network (the Software),
and (ii) providing the implementation, training, and consulting services that
support the Software.

 

B.            “Change of Control” shall mean either of the following: (i) the
acquisition, directly or indirectly after the date of this Agreement, in one
series of related transactions, of 45% or more of the Company’s common stock by
any person as that term is defined in Section 13(d)(3) of the Securities
Exchange Act of 1934, as amended excluding any acquisitions in capital raising
transactions; (ii) the consummation of a merger, consolidation, share exchange
or similar transaction of the Company with any other corporation, entity or
group, as a result of which the holders of the voting capital stock of the
Company as a group would receive less than 45% of the voting capital stock of
the surviving or resulting corporation, or (iii) the consummation of an
agreement providing for the sale or transfer (other than as security for
obligations of the Company) of substantially all the assets of the Company,
provided that none of the transactions described in subsections (i), (ii) or
(iii) shall include a transaction or series of transactions with an entity which
is controlled, directly or indirectly, after the transaction, by the Company or
another entity in which the shareholders of the Company immediately prior to
such transaction control, directly or indirectly, at least 45% of the
outstanding voting securities (including any entity which as a result of such
transaction owns the Company or all or substantially all of the Company’s assets
either directly or through one or more subsidiaries), provided, however, that no
event shall constitute a Change of Control under this Agreement unless it is a
“change in control event” under Code section 409A and the regulations
thereunder.

 

C.            “Company” means Optio Software, Inc., its parents, subsidiaries,
affiliates and all related companies, as well as their respective officers,
directors, shareholders, employees, agents and any other representatives.

 

D.            “Confidential Information” means information of the Company, to
the extent not considered a Trade Secret under applicable law, that (i) relates
to the business of the Company, (ii) possesses an element of value to the
Company, (iii) is not generally known to the Company’s competitors, and
(iv) would damage the Company if disclosed. Confidential Information includes,
but is not limited to, (i) future business plans, (ii) the composition,
description, schematic or design of products, future products or equipment of
the Company, (iii) communication systems, audio systems, system designs and
related documentation, (iv) advertising or marketing plans, (v) information
regarding independent contractors, employees, clients and customers of the
Company, and (vi) information concerning the Company’s financial structure and
methods and procedures of operation. Confidential Information shall not include
any information that (i) is or becomes generally available to the public other
than as a result of an unauthorized disclosure, (ii) has been independently
developed and disclosed by others without violating this Agreement or the legal
rights of any party, or (iii) otherwise enters the public domain through lawful
means.

 

 

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E.             “Contact” means any interaction between You and a Customer which
(i) takes place in an effort to establish, maintain, and/or further a business
relationship on behalf of the Company and (ii) occurs during the last year of
Your employment with the Company (or during Your employment if employed less
than a year).

 

F.             “Customer” means any person or entity to whom the Company has
sold its products or services, or solicited to sell its products or services.

 

G.            “Employee” means any person who (i) is employed by the Company at
the time Your employment with the Company ends, (ii) was employed by the Company
during the last year of Your employment with the Company (or during Your
employment if employed less than a year), or (iii) is employed by the Company
during the Restricted Period.

 

H.            “Licensed Materials” means any materials that You utilize for the
benefit of the Company, or deliver to the Company or the Company’s customers,
which (i) do not constitute Work Product, (ii) are created by You or of which
You are otherwise in lawful possession, and (iii) You may lawfully utilize for
the benefit of, or distribute to, the Company or the Company’s customers.

 

I.              “Restricted Period” means the time period during Your employment
with the Company, and for one year after Your employment with the Company ends.

 

J.             “Trade Secrets” means information of the Company, and its
licensors, suppliers, clients and customers, without regard to form, including,
but not limited to, technical or nontechnical data, a formula, a pattern, a
compilation, a program, a device, a method, a technique, a drawing, a process,
financial data, financial plans, product plans, or a list of actual or potential
customers or suppliers which is not commonly known by or available to the public
and which information (i) derives economic value, actual or potential, from not
being generally known to, and not being readily ascertainable by proper means
by, other persons who can obtain economic value from its disclosure or use, and
(ii) is the subject of efforts that are reasonable under the circumstances to
maintain its secrecy.

 

K.            “Work Product” means (a) any data, databases, materials,
documentation, computer programs, inventions (whether or not patentable),
designs, and/or works of authorship, including but not limited to, discoveries,
ideas, concepts, properties, formulas, compositions, methods, programs,
procedures, systems, techniques, products, improvements, innovations, writings,
pictures, audio, video, images of You, and artistic works, and (b) any subject
matter protected under patent, copyright, proprietary database, trademark, trade
secret, rights of publicity, confidential information, or other property rights,
including all worldwide rights therein, that is or was conceived, created or
developed in whole or in part by You while employed by the Company and that
either (i) is created within the scope of Your employment, (ii) is based on,
results from, or is suggested by any work performed within the scope of Your
employment and is directly or indirectly related to the business of the Company
or a line of business that the Company may reasonably be interested in pursuing,
(iii) has been or will be paid for by the Company, or (iv) was created or
improved in whole or in part by using the Company’s time, resources, data,
facilities, or equipment.

 

 

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EXHIBIT B

 

CHIEF EXECUTIVE OFFICER AND PRESIDENT

 

Position Responsibilities:

 

Develop the Company’s business and product strategy and carry it through full
implementation.

 

Work closely with the Board of Directors in reviewing the market place strategy
and evaluating new growth opportunities and acquisition targets.

 

Lead, manage and direct business on a day-to-day basis worldwide with full
responsibility and accountability for vision, processes, growth, profitability
and effectively implementing business plans.

 

Serve as an officer and/or director of the Company’s subsidiaries as requested
by the Company.

 

Ensure that Company assets are utilized to the maximum.

 

Establish strong connection with potential partners, customers, industry
experts, trade analysts, financial analysts and investment bankers.

 

Increase organizational intensity, establish individual and team goals and
accountability, while creating an environment, which rewards and promotes a
commitment to excellence and winning.

 

Begin to assume a prominent industry profile through participation in a variety
of public and industry-oriented forums to understand the competitive environment
and opportunities for future growth.

 

Perform periodic performance and compensation reviews for the management team.
Retain proper documentation for all review/counseling sessions.

 

Schedule quarterly Board meetings as authorized by the Board. Prepare an agenda
and circulate it to all members of Board. Arrange for minutes to be taken,
distributed and filed.

 

Review financial and statistical reports for presentation to the Board.

 

Maintain direct/indirect approval of all Company expenditures. Approve and sign
accounts payable and payroll checks within the established financial guidelines.

 

In conjunction with legal counsel, assure appropriateness of all legal contracts
for Company.

 

 

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Interface with Company’s accounting, insurance, legal firms, pension advisors
and consultants as required.

 

Perform other duties as requested by the Board of Directors to ensure the smooth
operation and goal attainment for Company.

 

 

 

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