**Exhibit 10.7**

 

DENDRITE

1405/21425 ROUTE 206 SOUTH   BEDMINSTER, NJ 07921 USA

 

October 3, 2005

 

 

 

Joseph Ripp

[Address]

 

Dear Joe:

 

                Wewould like to confirm the terms and conditions of your employment with DendriteInternational, Inc. (“Dendrite”) as set forth below in the Specific Terms andConditions of Employment and the General Terms and Conditions of Employment(collectively the “Agreement”).

 

 

**SPECIFIC TERMS &****CONDITIONSOF EMPLOYMENT**

 

**1.                DUTIES/TERM.**Youwill be employed as President and Chief Operating Officer reporting to theChief Executive Officer (“CEO”). This employment is subject to Boardratification. If the Board ratifies your employment, you anticipate startingemployment on November 1, 2005. You shall (i) perform those duties as may fromtime to time be assigned to you by the CEO, consistent with your seniorposition; (ii) devote your full-time attention and best efforts solely andexclusively to the duties assigned to you; and (iii) comply with all existing Dendriterules, regulations, policies and directives and those which may be establishedfrom time to time. Your employment will be at-will and may be terminated at anytime for any reason with or without cause by Dendrite. You agree to provide two(2) weeks notice to Dendrite before terminating your employment.

 

**2.**                **COMPENSATION.**

 

(a)                BaseSalary. Dendrite shall pay you for your services a base salary at a rate of$800,000 per annum to be paid on asemi-monthly basis in accordance with Dendrite’s regular payroll practices.Dendrite may increase, but not decrease,your base salary during your employment. Any salary increases will be evaluatedno less frequently than on the anniversary date of your employment.

 

DENDRITEINTERNATIONAL, INC

TEL 908.443.2000FAX 908.443.4369 www.dendrite.com

 

 

----

 

(b)                Bonus.You will be eligible to receive an annual discretionary bonus (the “Bonus”)with an initial target of $600,000. Bonus eligibility shall be determined andpaid in accordance with Dendrite’s applicable incentive compensation policythen in effect for senior executives. The payment of any Bonus is subject to:(i) Dendrite’s achievement of quarterly and annual financial goals as set forthin the Board approved annual business plan, (ii) such other objectives as may bedetermined by Dendrite from time to time and (iii) the terms and conditions ofthe applicable incentive compensation plan then in effect for seniorexecutives. Your target for a discretionary bonus will be reviewed anddetermined on an annual basis by Dendrite. Your target bonus may be increased,but not decreased during your employment. Notwithstanding the forgoing,Dendrite will pay you a 2005 bonus calculated as follows: $600.000 times afraction the numerator of which is the number of days you worked for Dendriteand the denominator of which is 365, subject to the provisions of section 4. Inaddition, Dendrite will pay you at least a $600,000 bonus for 2006, subject tothe provisions of section 4. Bonuses shall be paid no later than March 31 ofthe following year.

 

(c)                StockOptions. Pursuant to Dendrite’s New Hire Stock Plan (the “Stock Plan”),upon the execution of this Agreement, you shall he eligible to receivenon-qualified options to purchase 500,000 shares of the common stock ofDendrite. The price for such options shall be determined by the CompensationCommittee of the Board, subject to the terms and conditions of the Stock Plan.Such options shall fully vest on December 31, 2005. In 2006 and any subsequentyear of this Agreement, you will be eligible to receive non-qualified optionsto purchase stock in an amount in excess of the amount of any such optionsgranted to any other senior executive of Dendrite with respect to such year(except for options granted to the CEO). In addition, your entitlement to suchoptions shall he subject to (i) a three-year restriction on selling theunderlying shares such that no more than 1/3 of such shares may be sold ineach of the three (3) twelve-month periods ending on the first, second andthird year anniversaries of the option grant date, (ii) approval by the Board,(iii) your execution of a definitive option agreement in form and substancereasonably satisfactory to Dendrite and (iv) in all instances subject to theterms and conditions of the Stock Plan.

 

(d)                RestrictedStock. Pursuant to the Stock Plan, upon the execution of this Agreement,you shall be eligible to receive 250,000 restricted units of the common stockof Dendrite. Your entitlement to such restricted stock units shall be subjectto (i) a three-year vesting schedule (ii) approval by the Board, (iii) yourexecution of a definitive restricted stock agreement in form and substancereasonably satisfactory to Dendrite and (iv) in all instances subject to theterms and conditions of the Stock Plan.

 

**3.                BENEFITS.**

 

Dendriteshall provide you:

 

(a)                Vacation.4 weeks vacation per annum in accordance with Dendrite policy in effect fromtime to time. Unused vacation is paid out, on a pro-rata basis, upon employmenttermination.

 

 

1

----

 

(b)                BusinessExpenses. Reimbursement for reasonable travel, entertainment and otherreasonable and necessary out-of-pocket expenses incurred by you in connectionwith the performance of your duties in accordance with Dendrite policy ineffect from time to time.

 

(c)                RetirementBenefits. Retirement benefits to the same extent as may be provided toother similarly situated senior executives in accordance with Dendrite policythen in effect and subject to the terms and conditions of such benefit plans.

 

(d)                Indemnification.Throughout your employment with Dendrite, you will have indemnification rightsin accordance with the indemnification provisions contained in the Company’sDirectors & Officers insurance policy, Certificate of Incorporation, andBy-laws, then in effect. In addition, you will have the indemnification rightsas set forth in the Indemnification Agreement between you/Dendrite.

 

(e)                LifeInsurance. Throughout your employment with Dendrite, you will he coveredunder Dendrite’s life insurance policy, subject to the terms and conditions ofsuch policy as amended from time to time. To the extent that the life insurancebenefits under such coverage is not at least equal to one times your basesalary and target bonus (the “Life Insurance Benefit”), Dendrite will reimburseyou the cost of your obtaining total coverage that provides the Life InsuranceBenefit, as follows. You agree to obtain any necessary excess coverage throughDendrite’s life insurance policy, subject to any cap. If after reaching anysuch cap, you still do not have coverage that provides the Life InsuranceBenefit, then you may obtain coverage from an outside source at a commerciallyreasonable price so that in total you have coverage that provides the LifeInsurance Benefit. Provided you comply with the provisions set forth herein,Dendrite agrees to reimburse you for the cost of the excess insurance under itsplan and coverage from an outside source to attain in total the Life InsuranceBenefit. At Dendrite’s sole discretion, Dendrite may elect to provide you withany or all coverage under this Section 3(e) through any

insurance it obtains.

 

(f)                DisabilityInsurance. Throughout your employment with Dendrite, you will be coveredunder Dendrite’s long-term and short-term disability policies, subject to theterms and conditions of such policies as amended from time to time. To theextent that the long-term disability benefit properly payable under Dendrite’slong-term disability policy is not at least equal to one times your base salaryand target bonus (the “LTD Benefit”), Dendrite will reimburse you the cost ofyour obtaining total coverage that provides the LTD Benefit as follows. You agreeto obtain any necessary excess coverage through Dendrite’s Long-Term DisabilityPlan, subject to any cap. If after reaching any such cap, you still do not havetotal coverage that provides the LTD Benefit, then you may obtain coverage froman outside source at a commercially reasonable price so that in total you havecoverage that provides the LTD Benefit. Provided you comply with the provisionsset forth herein, Dendrite agrees to reimburse you for the cost of the excessinsurance under its policies and coverage from an outside source to attain intotal the LTD Benefit. At Dendrite’s sole discretion, Dendrite may elect toprovide you with any or all coverage under this Section 3(f) through anyinsurance it obtains.

 

 

2

----

 

(g)                Other.Other benefits to the same extent and with the same cost as may be providedto other senior executives in accordance with Dendrite policy then in effectand subject to the terms and conditions of such benefit plans. Such benefitsmay include, but are not limited to, Medical, Dental, Life and AD&D, ShortTerm Disability, Long-Term Disability, and Deferred Compensation.

 

**4. TERMINATION;SEVERANCE**

 

(a)                Uponyour termination of employment by Dendrite for any reason other than terminationby Dendrite for Cause (as defined in Exhibit A), Disability (as defined inExhibit A) or upon your death, you shall solely be entitled to (subject to anyapplicable off-sets) applicable payments and benefits in Section 4(b), and yourbase salary through the date of your termination.

 

(b)                Ifyour employment hereunder is terminated (i) by Dendrite for any reason otherthan death, Cause (as defined in Exhibit A), or Disability (as defined inExhibit A), or (ii) voluntarily by you with Good Reason (as defined in ExhibitA), you shall be entitled to receive severance payments of your monthly basesalary for 12 months following your employment termination (calculated at therate of base salary then being paid to you as of the date of termination) and yourannual target bonus as of the date of termination. The severance payments to bepaid to you under this Section 4(b) shall be referred to herein as the “SeverancePayment” and the 12-month period of Severance Payments shall be referred to asthe “Severance Period.” Your severance shall commence on the next regularlyscheduled monthly payday following the effective date of the termination ofyour employment. No interest shall accrue or be payable on or with respect toany Severance Payment. Your benefits coverage will continue under Dendrite’sgroup medical and dental plans for the Severance Period. At the conclusion ofthe Severance Period, you shall be provided the opportunity to continue yourbenefits coverage pursuant to “COBRA,” Sections 601 et seq. of ERISA. Duringthe Severance Period your cost of health and dental benefits coverage shall bethe same as the amount you paid as an active employee under Dendrite’s grouphealth and dental plans. Notwithstanding the foregoing, in the event you becomere-employed with another employer during the Severance Period, you will nolonger be eligible for participation in Dendrite’s plans at employee rates,Dendrite will have no obligation to pay for the cost of any health and dentalcoverage. and you will immediately become eligible for COBRA coverage at COBRA(102% of premiums) rates. You agree to notify Dendrite of any full timeemployment that you begin during the Severance Period. If your employment isterminated by Dendrite as described in this Section 4(b), in addition to theSeverance Payment, your bonus for the year in which employment is so terminatedwill be pro­rated to reflect the percentage of days of the year during whichyou performed services for Dendrite (“Pro-rata Bonus Payment”).

 

(c)                Inthe event of a Change of Control all stock options then granted to you byDendrite will immediately vest and all sale restrictions will be lifted.

 

(d) Themaking of any Severance Payments and Pro-rata Bonus Payment and the provisionof benefits under Sections 4 (b) or 4 (c) hereunder is conditioned upon thesigning of a

 

 

3

----

general release in  form andsubstance satisfactory to Dendrite under which you releaseDendrite and its affiliates together with their respective officers, directors,shareholders, employees, agents and successorsand assigns from any and all claims you may have against them. You will not berequired to releaseyour rights under Dendrite’s benefit and retirement plans, stock plans, or anyrights that you may have to coverage and indemnification pursuant to law orDendrite policies. In the event you breach Section 2, 3, 5 and 6 of the GeneralTerms and Conditions of Employment, in addition to any other remedies at law orin equity, Dendrite may cease making any Severance Payment or Pro-rata BonusPayment otherwise due under Sections 4(b). Nothing herein shall affect anyof your obligations or Dendrite’s rights under this Agreement.

 

                (e)                Inthe event you terminate your employment with Dendrite without “Good Reason” orDendrite terminates your employment for “Cause” it is understood and agreedthat Dendrite’s only obligation is topay you your base salary through the date of your termination and to offer you COBRA coverage in accordancewith applicable law. You will not be entitled to a Pro-rata BonusPayment if youterminate employment without Good Reason or are terminated for Cause.

 

                Please signwhere indicated below to acknowledge your agreement to theSpecific Terms and Conditions (“Special Terms”) set forth above and the General Terms andConditions of Employment attached hereto (“General Terms”), both of whichtogether shall form the termsand conditions of your employment (the “Agreement”).

 
|                    |    | Sincerely                         |
|-------------------------|---------|-----------------------------------|
|                    |    |                              |
|                    |    | /s/ John Bailye                   |
|                    |    |                              |
|                    |    | John Bailye                       |
|                    |    | Chairman, Chief Executive Officer |
|                    |    |                              |
| Accepted and agreed to: |    |                              |
|                    |    |                              |
|                    |    |                              |
| /s/ Joseph Ripp         |    |                              |
| Joseph Ripp             |    |                              |
|                    |    |                              |
| Date:                   | 10-5-05 |                              |   |
|                         |         |                                   |  |

 

 

4

----

**DENDRITE INTERNATIONAL, INC.**

**GENERAL TERMS**& **CONDITIONS OF EMPLOYMENT**

**(together withthe Specific Terms and Conditions of Employment, the “Agreement”)**

 

 

**1.             INFORMATIONAND BUSINESS OPPORTUNITY.**During your employment with Dendrite,you may acquire knowledge of (i) information that is relevant to the businessof Dendrite or its affiliates or (ii) knowledge of business opportunitiespertaining to the business in which Dendrite or its affiliates are engaged. Youshall promptly disclose to Dendrite that information or business opportunitybut shall not disclose it to anyone else without Dendrite’s written consent.

 

**2.**             **DENDRITE AND CLIENT CONFIDENTIAL INFORMATION.**As a result of your employment with Dendrite, you will acquire informationwhich is proprietary and confidential to Dendrite and its affiliates (“ConfidentialInformation’’). This Confidential Information includes, but is not limited to,Dendrite’s proprietary software, technical and commercial information,instruction and product information, the design, “look and feel” andcapabilities of Dendrite’s product, Dendrite’s proprietary training programmethodology regarding the utilization of electronic territory managementsoftware and associated client support services. Dendrite’s methodology forpromoting its products and services to its clients, Dendrite’s proprietaryGraphic User Interface, the navigational paths through which Dendrite’s clientsinput and access information stored in the proprietary software, theparticularized needs and demands of Dendrite’s clients and the customizationsDendrite makes to its proprietary software to meet those clients’ needs,financial arrangements, salary and compensation information, competitivestatus, pricing policies, knowledge of suppliers, technical capabilities,discoveries, algorithms, concepts, software in any stage of development,designs, drawings, specifications, techniques, models, data, technical manuals,training guides and manuals, research and development materials, processes,procedures, know-how and other business affairs relating to Dendrite.Confidential Information also includes any and all technical informationinvolving Dendrite’s work. In addition, Dendrite may be furnished informationand data which is proprietary and confidential to its clients, partners,suppliers and other third parties (“Third Parties”). You agree to use theConfidential Information of Dendrite and Third Parties solely during and infurtherance of your employment with Dendrite. You agree to keep all suchConfidential Information confidential and agree not to reveal it at any timewithout the express written consent of Dendrite. This obligation is to continuein force after employment terminates for whatever reason.

 

Confidential Information shall not include informationwhich the receiving party can demonstrate: (a) is or becomes available tothe public through no breach of this Agreement; (b) was previously known by thereceiving party without any obligation to hold it in confidence; (c) isreceived from a third party free to disclose such information withoutrestriction; (d) is independently developed by the receiving party without theuse of Confidential Information of the disclosing party; (e) is approved forrelease by written authorization of the disclosing party, but only to theextent of and subject to such conditions as may be imposed in such writtenauthorization; (f) is required by law or regulation to be disclosed, but onlyto the extent and for

 

5

----

 

the purposes of such required disclosure; or, (g) is disclosedin response to a valid order of a court and other governmental body of theUnited States or any political subdivision thereof, but only to the extent ofand for the purposes of such order; provided, however, that the receiving partyshall first notify the disclosing party of the order and permit the disclosingparty to seek an appropriate protective order.

 

**3.             RETURNOF PROPERTY.**Upon termination of employment for any reason or upon therequest of Dendrite, you shall fully account for and return to Dendrite allproperty which you received, prepared or helped prepare in connection with youremployment including, but not limited to, all copies of any confidentialinformation or records, data, materials, disks, notes, notebooks, blueprints,client lists or other papers or material in any tangible media or computer readableform belonging to Dendrite or to any of its clients, partners and suppliers.You will not retain any copies, duplicates, reproductions or excerpts thereof.

 

**4.             INVENTIONS.**Allwork performed by you and all materials, products, deliverables, inventions,software, ideas, disclosures and improvements, and copyrighted material made orconceived by you, solely or jointly, in whole or in part, during youremployment with Dendrite (even if completed following the termination of youremployment) that relate to any matters pertaining to the business of Dendriteshall be the property of Dendrite and shall be deemed to be a work made forhire. To the extent that title to any of the foregoing shall not, by operationof law, vest in Dendrite, all right, title and interest therein are herebyirrevocably assigned to Dendrite. You agree to giveDendrite or any person or entity designated by Dendrite reasonable assistancerequired to perfect its rights therein.

 

**5.**            **RESTRICTION ON FUTURE EMPLOYMENT.**Youacknowledge (i) the highly competitive nature of the business and the industryin which Dendrite competes; (ii) that you will acquire and have access toconfidential information as described in Section 2 of the General Terms; (iii)that, as a key employee of Dendrite, you will participate in the servicing ofcurrent clients and/or the solicitation of prospective clients, through which,among other things, you will obtain knowledge of the “know-how” and businesspractices of Dendrite, in which matters Dendrite has a substantial proprietaryinterest; and (iv) that your employment hereunderrequires the performance of services which are special, unique, extraordinary andintellectual in character, and your position with Dendrite places you in aposition of confidence and trust with the clients and employees of Dendrite. Inthe course of your employment with Dendrite, you will develop a personalrelationship with the clients of Dendrite and a knowledge of those clients’affairs and requirements, and that the relationship of Dendrite with theirestablished clientele will therefore be placed in your hands in confidence andtrust. You consequently agree that it is reasonable and necessary for the protectionof the confidential information, goodwill and business of Dendrite that youmake the covenants contained herein and that Dendrite would not have enteredinto this Agreement unless the covenants set forth in this Section 5 werecontained in this Agreement. Accordingly, you agree that during the period thatyou are employed by Dendrite and for a period of eighteen (l8) monthsthereafter, you shall not, as an individual, employee, consultant, partner,shareholder, or in association with any other person, business or enterprise,except on behalf of

 

6

----

 

Dendrite, directly or indirectly, and regardless of thereason for your ceasing to be employed by Dendrite:

 

(a)           perform services that compete withthe business or business conducted by Dendrite or any of its affiliates orrender services to any person or entity which competes with the business ofbusinesses conducted by Dendrite or any of its affiliates (or which businessDendrite can at the time of your termination of employment establish it willlikely conduct within one (1) year following the date of your termination);

 

(b)           attempt in any manner to solicit oraccept from any client business of the type performed by Dendrite or to persuadeany client to cease to do business or to reduce the amount of business whichany such client has customarily done or is reasonably expected to do withDendrite, whether or not the relationship between Dendrite and such client wasoriginally established in whole or in part through your efforts;

 

(c)           employ, attempt to employ or assistanyone else in employing any employee or contractor of Dendrite or induce orattempt to induce any employee or contractor of Dendrite to terminate theiremployment or engagement with Dendrite; or

 

(d)           render to or for any client anyservices of the type rendered by Dendrite (unless such services are rendereddirectly to a client as an employee of such client, in which case this Section5(d) shall not apply).

 

As used in this Section 5, the term “Dendrite”shall mean Dendrite and its affiliates, and the term “client” shall mean (1)anyone who is a client of Dendrite on the date of your termination or, if youremployment shall not have terminated, at the time of the alleged prohibitedconduct (any such applicable date being called the “Determination Date”), butonly if you solicited, rendered services for, or were otherwise involved withany such client at any time during your employment with Dendrite; (2) anyonewho was a client of Dendrite at any time during the one (1) year periodimmediately preceding the Determination Date; but only if you solicited,rendered services for, or were otherwise involved with any such client at anytime during your employment with Dendrite; (3) any prospective client to whomDendrite had made a new business presentation (or similar offering of services)at any time during the one (1) year period immediately preceding theDetermination Date; but only if you actively participated in or supervised suchnew business presentation (or similar offering of services); and (4) anyprospective client to whom Dendrite made a new business presentation (orsimilar offering of services) at any time within six (6) months after the dateof your termination (but only if the initial discussions between Dendrite andsuch prospective client relating to the rendering of services occurred prior tothe date of your termination: and only if you actively participated in orsupervised such discussions). For purposes of this clause, itis agreed that a general mailing or an incidental contact shall not be deemed a“new business presentation or similar offering of services” or a “discussion”.In addition, if the client is part of a group of companies which conductsbusiness through more than one entity, division or operating unit, whether ornot separately incorporated (a “Client Group”), the term “client” as usedherein shall also include each entity, division and operating unit of theClient Group where the same management group

 

7

----

 

of the Client Group has the decision making authorityor significant influence with respect to contracting for services of the typerendered by Dendrite.

 

For an eighteen (18) month periodafter the termination of your employment for any reason whatsoever, you agreeto promptly notify Dendrite in writing the identity of all subsequentemployers. You agree to provide such information as Dendrite may from time totime request to determine your compliance with the terms of this Agreement.

 

**6.             NON-DISPARAGEMENT.**Youagree that you will not at any time make any statement, observation or opinion,or communicate any information (whether oral or written) that is likely to cometo the attention of any client or employee of Dendrite or any member of themedia, which statement is derogatory of or casts in a negative light Dendriteor its officers, directors and employees or otherwise engage in any activitywhich is inimical to the interests of the Company.

 

**7.**             **OUTSIDE CONTRACTING.**You shall notenter into any agreements during your employment by Dendrite to provideservices to any company, person or organization outside of your employment byDendrite (an “Outside Agreement”) without the prior written express consentfrom Dendrite. You must notify Dendrite of your intent to enter into an OutsideAgreement specifying therein the other party to such Outside Agreement and thetype of services to be provided by you. Dendrite shall not unreasonablywithhold permission to you to enter into Outside Agreements unless such OutsideAgreements (i) are with competitors or potential competitors of Dendrite, or(ii) as determined in Dendrite’s sole discretion, shall substantially hamper orprohibit you from satisfactorily carrying out all duties assigned to you byDendrite. The parties agree that the Advisory Services Agreement between youand Time Warner Inc. dated January 1, 2001 (“the 2001 Advisory ServicesAgreement”) does not constitute a violation of this Agreement and may continueby its terms until it expires on November 30, 2006. The parties also agree thatyou may serve on one Board of Directors of a publicly traded company at anygiven time during the duration of this Agreement so long as that company is notin a business that directly competes with Dendrite and that you disclose thisBoard position to Dendrite prior to your acceptance of any such position.

 

**8.             REMEDIES.**Theparties agree that in the event you breach or threaten to breach thisAgreement, money damages may be an inadequate remedy for Dendrite and thatDendrite will not have an adequate remedy at law. It is understood, therefore,that in the event of a breach or threatened breach of this Agreement by you,Dendrite shall have the right to obtain from a court of competent jurisdictionrestraints or injunctions prohibiting you from breaching or threatening tobreach this Agreement. In that event, the parties agree that Dendrite will notbe required to post bond or other security. It is also agreed that any restraintsor injunctions issued against you shall be in addition to any other remedieswhich Dendrite may have available to it.

 

**9.             ARBITRATION**

 

                (a)           If any dispute arises between you andDendrite that the parties cannot resolve themselves, including any dispute overthe application, validity, construction, or interpretation of

 

8

----

 

this Agreement, arbitration in accordance with thethen-applicable employment law rules of the American Arbitration Associationshall provide the exclusive remedy for resolving any such dispute, regardlessof its nature; provided, however, that Dendrite may enforce your obligation to provideservices under this Agreement and your obligations under Sections 1 through 7hereof by an action for injunctive relief and damages in a court of competentjurisdiction at any time prior or subsequent to the commencement of anarbitration proceeding as herein provided. This Section 9 shall apply to anyand all claims arising out of your employment and its termination, under stateand federal statutes, local ordinances, and the common law including, withoutlimitation Title VII of the Civil Rights Act of 1964, as amended, the CivilRights Act of 1991, the Equal Pay Act, the Employee Retirement Income SecurityAct, as amended, the Age Discrimination in Employment Act of 1967, theAmericans with Disabilities Act of 1990, the Family and Medical Leave Act of1993, the Fair Labor Standards Act, the New Jersey Family Leave Act, the NewJersey Conscientious Employee Protection Act, the New Jersey Civil Rights Actand the New Jersey Law Against Discrimination.

 

**                (b)           You have read and understand thisSection 9 which discusses arbitration. You understand that by signing thisAgreement, you agree to submit any claims arising out of, relating to, or inconnection with this Agreement, or the interpretation, validity, construction,performance, breach or termination thereof, or your employment or thetermination thereof, to binding arbitration, and that this arbitrationprovision constitutes a waiver of your right to a jury trial and relates to theresolution of all disputes relating to all aspects of the employer/employeerelationship. You further understand that other options such as federal andstate administrative remedies and judicial remedies exist and know that bysigning this Agreement those remedies are forever precluded and that regardlessof the nature of your complaint, you know that it can only be resolved byarbitration.**

 

                (c)           Unless the parties agree otherwise,any arbitration shall be administered by and take place in the offices of theAmerican Arbitration Association in Somerset, New Jersey. If that office is notavailable, the arbitration then the arbitrator shall determine the location ofthe arbitration within New Jersey.

 

**10.          SEVERABILITY.**If any provision of this Agreementshall be declared invalid or illegal for any reason whatsoever, thennotwithstanding such invalidity or illegality, the remaining terms andprovisions of this Agreement shall remain in frill force and effect in the samemanner as if the invalid or illegal provision had not been contained herein.Moreover, if any one or more of the provisions contained in this Agreement isheld to be excessively broad as to duration, scope, activity or subject, suchprovisions will be construed by limiting and reducing them so as to be enforceableto the maximum extent compatible with applicable law.

 

**11.          NOTICES.**In the event any notice is required tobe given under the terms of this Agreement, it shall be delivered in theEnglish language, in writing, as follows:

 

9

----

 
|   | If to you:      | To the address set forth on the first page of this  Agreement |
|--------|-----------------|---------------------------------------------------------------|
|   |            |                                                          |
|   | If to Dendrite: | Attn: General Counsel                                         |
|   |            | Dendrite International. Inc.                                  |
|   |            | 1405 Route 206 South                                          |
|   |            | Bedminster, NJ 07921                                          |

 

or to such other address as either party may havefurnished to the other in writing in accordance herewith, except that noticesof changes of address shall be effective only upon receipt.

 

**12.          PRIOR EMPLOYMENT.**You represent and warrant that youhave not taken or otherwise misappropriated and do not have in your possessionor control any confidential and proprietary information belonging to any ofyour prior employers or connected with or derived from your service to prioremployers, except as may be necessary to provide services under the 2001Advisory Services Agreement. You represent and warrant that you have returnedto all prior employers any and all such confidential and proprietary information.You further acknowledge, represent and warrant that Dendrite has informed youthat you are not to use or cause the use of such confidential or proprietaryinformation in any manner whatsoever in connection with your employment byDendrite. You agree, represent and warrant that you will not use suchinformation in connection with your employment by Dendrite. You shall indemnifyand hold harmless Dendrite from any and all claims arising from any breach ofthe representations and warranties in this Section.

 

**13.               MISCELLANEOUS.**

 

                (a)           This Agreement shall be governed byand construed in accordance with the laws of New Jersey, without regard to theconflicts of laws. Competent courts of jurisdiction in New Jersey shall haveexclusive jurisdiction to entertain any legal or equitable action with respectto Sections l through 8 of the General Terms except that Dendrite may instituteany such suit against you in any jurisdiction in which you may be at the time.In the event suit is instituted in New Jersey, it is agreed that service ofsummons or other appropriate legal process may be affected upon any party bydelivering it to the last known address.

 

                (b)           Your rights or obligations under theterms of this Agreement or of any other agreement with Dendrite may not beassigned. Any attempted assignment will be void as to Dendrite. Dendrite may,however, assign its rights to any affiliated or successor entity.

 

                (c)           This Agreement sets forth the entireagreement between the parties hereto and fully supersedes any and all priornegotiations, discussions, agreements or understandings between the partieshereto pertaining to the subject matter hereof. No representations, oral orotherwise, with respect to the subject matter of this Agreement have been madeby either party. This Agreement may not be modified or waived except by awriting signed by both parties. No waiver by either party of any breach by theother shall be considered a waiver of any subsequent breach of the Agreement.

 

10

----

 

                (d)           This Agreement shall be binding uponand inure to the benefit of your heirs and personal representatives and to thesuccessors and assigns of Dendrite.

 

 

 
|      John Bailye |   |
|--------------------------------------|--------|
| on behalf of Dendrite                |   |
|                                 |   |
|                                 |   |
|                                 |   |
|                                 |   |
| Joseph A. Ripp.                      |   |

 

11

----

 

**Exhibit A To Dendrite SpecificTerms & Conditions Of Employment**

 

                                (a)           “Cause” as used in this Agreementshall mean (i) any gross misconduct onthe part of you while employed by Dendrite with respect to your duties underthis Agreement, (ii) the engaging by you in an indictable offense whileemployed by Dendrite which relates to your duties under this Agreement or whichis likely to have a material adverse effect on the business of Dendrite, (iii)the commission by you of any willful or intentional act while employed byDendrite which injures in any material respect or could reasonably be expectedto injure in any material respect the reputation, business or businessrelationships of Dendrite, including without limitation, a breach of Sections 1through 7 of the General Terms and Conditions of Employment, or (iv) theengaging by you through gross negligence in conduct while employed by Dendritewhich injures materially or could reasonably be expected to injure materiallythe business or reputation of Dendrite.

 

                                                (b)           “Disability”as used in this Agreement shall have the same meaning as that term, or suchsubstantially equivalent term, has in any group disability policy carried byDendrite. If no such policy exists, the term “Disability” shall mean the occurrenceof any physical or mental condition which materially interferes with theperformance of your customary duties in your capacity as an employee where suchdisability has been in effect for a period of six (6) months (excludingpermitted vacation time), which need not be consecutive, during any singletwelve (12) month period.

 

                (c)           “Good Reason” as used in thisAgreement shall mean, without your express written consent, the occurrence ofany of the following events which is not corrected within ten (10) daysfollowing written notice of such event given by you to Dendrite:

 

                                                                (i)            the assignment to you of any dutiesor responsibilities materially and adversely inconsistent with your position(including any material diminution of such duties or responsibilities) or (B) amaterial and adverse change in your reporting responsibilities, titles oroffices with Dendrite;

 

                                                                                                (ii)           anymaterial breach by Dendrite this Agreement with respect to the making of anycompensation payments, including without limitation the failure to approvestock options set forth in the Agreement;

 

                                                                                                (iii)          anyrequirement of Dendrite that you be based anywhere other than in a thirty-five(35) mile radius of the Dendrite office you are based in

 

                                                                                                (iv)          thefailure of Dendrite to continue in effect any employee benefit plan,compensation plan, welfare benefit plan or fringe benefit plan (such plansbeing referred to herein as “Welfare Plans”) in which you are participating asof the date of this Agreement (or as such benefits and compensation may beincreased from time to time), or the taking of any action by Dendrite whichwould materially and adversely affect your participation in or materiallyreduce your benefits under such Welfare Plans (other thanan

 
|   | Initial here | JB |   |
|--------|--------------|----|--------|

 

 

1

----

 

 

                                                                                                                                                across-the-board reduction of suchbenefits affecting senior executives of Dendrite) unless (i) you are permittedto participate in other plans providing you with substantially comparablebenefits (at substantially comparable cost with respect to the Welfare Plans),(ii) any such Welfare Plan does not provide material benefits to you(determined in relation to your compensation and benefits package), (iii) suchfailure or action is taken at the direction of you or with your consent, or(iv) such failure or action is required by law; or

 

                                                                                                (v)           thefailure of Dendrite to obtain an agreement from a successor employer to assumeDendrite’s obligations under this Agreement in the event of a Change inControl.

 

You must notify Dendrite of any event constituting Good Reason withinninety (90) days following your knowledge of its existence or such event shallnot constitute Good Reason.

 

                (d)           “Change in Control” as used in thisAgreement shall mean the occurrence of any one of the following events:

 

                                                                                (i)any “person” (as such term is defined in Section 3(a)(9) of the Securities andExchange Act of 1934, as amended (the “Exchange Act”), and as used in Sections13(d)(3) and 14(d)(2) of the Exchange Act) is or becomes a “beneficial owner”(as defined in rule 13d-3 under the Exchange Act), directly or indirectly, ofsecurities of Dendrite representing 33 1/3% ormore of the combined voting power of Dendrite’s then outstanding securitieseligible to vote for the election of the Board (the “Dendrite Voting Securities”);provided, however, that the event described in thissubsection (i) shall not be deemed to be a Change in Control by virtue of anyof the following acquisitions: (A) by Dendrite or any subsidiary, (B) by anyemployee benefit plan sponsored or maintained by Dendrite or any subsidiary, (C)by any underwriter temporarily holding securities pursuant to an offering ofsuch securities, (D) pursuant to a Non-Control Transaction (as defined insubsection (iii)), or (E) a transaction (other than one described in subsection(iii) below) in which Dendrite Voting Securities are acquired from Dendrite, ifa majority of the Incumbent Board (as defined below) approves a resolutionproviding expressly that the acquisition pursuant to this clause (E) does notconstitute a Change in Control under this subsection (i);

 

                                                                                (ii)           individuals who, on the date of thisAgreement, constitute the Board (the “Incumbent Board”) cease for any reason toconstitute at least a majority thereof, provided that any person becoming adirector subsequent to such date, whose election or nomination for election wasapproved by a vote of at least two-thirds of the directors comprising theIncumbent Board (either by a specific vote or by approval of the proxystatement of Dendrite in which such person is named as a nominee for director,without objection to such nomination) shall be considered a member of theIncumbent Board; provided, however, that no individual initiallyelected or nominated as a director of Dendrite as a result of an actual orthreatened election contest with respect to directors

 

2

----

 

                                                or any other actual or threatenedsolicitation of proxies or consents by or on behalf of any person other thanthe Board shall be deemed to be a member of the Incumbent Board;

 

                                                                                (iii)          the shareholders of Dendrite approve amerger, consolidation, share exchange or similar form of corporatereorganization of Dendrite or any such type of transaction involving Dendriteor any of its subsidiaries (whether for such transaction or the issuance ofsecurities in the transaction or otherwise) (a “Business Combination”),unless immediately following such Business Combination: (A) more than 50% of thetotal voting power of the publicly traded corporation or effective controlresulting from such Business Combination (including, without limitation, anycorporation which directly or indirectly has beneficial ownership of 100% ofDendrite Voting Securities or all or substantially all of the assets ofDendrite and its subsidiaries) eligible to elect directors of such corporationwould be represented by shares that were Dendrite Voting Securities immediatelyprior to such Business Combination (either by remaining outstanding or beingconverted), and such voting power would be in substantially the same proportionas the voting power of such Dendrite Voting Securities immediately prior to theBusiness Combination, and (B) no person (other than any publicly traded holdingcompany resulting from such Business Combination, any employee benefit plansponsored or maintained by Dendrite (or the corporation resulting from suchBusiness Combination), or any person which beneficially owned, immediatelyprior to such Business Combination, directly or indirectly, 33-1/3%or more of Dendrite Voting Securities (a “Dendrite 33-1/3% Stockholder”)) wouldbecome the beneficial owner, directly or indirectly, of 33-1/3% or more of thetotal voting power of the outstanding voting securities eligible to electdirectors of the corporation resulting from such Business Combination and noDendrite 33-1/3% Stockholder would increase its percentage of such total votingpower and (C) at least a majority of the members of the board of directors of thecorporation resulting from such Business Combination would be members of theIncumbent Board at the time of the Board’s approval of the execution of theinitial agreement providing for such Business Combination (a “Non-ControlTransaction”); or

 

                                                                                (iv)          the shareholders of Dendrite approve aplan of complete liquidation or dissolution of Dendrite or the sale ordisposition of all or substantially all of the Dendrite’s assets.

 

                                                Notwithstanding the foregoing, a Changein Control of Dendrite shall not be deemed to occur solely because any personacquires beneficial ownership of more than 33 1/3% of Dendrite VotingSecurities as a result of the acquisition of Dendrite Voting Securities byDendrite which, by reducing the number of Dendrite Voting Securitiesoutstanding, increases the percentage of shares beneficially owned by suchperson; provided, that if a Change in Control of Dendrite would occur as aresult of such an acquisition by Dendrite (if not for the operation of thissentence), and after Dendrite’s acquisition such person becomes the beneficialowner of additional Dendrite Voting Securities that increases the percentage ofoutstanding Dendrite Voting Securities beneficially owned by such person, thena Change in Control of Dendrite shall occur.

 

 

 

3

----