**EXHIBIT 10.62**

 

Confidential Settlement CommunicationSubject to Rule 408 of the Federal Rules of Evidence

 
|   | |__|  Company’s Copy |
|--------|---------------------------|
|   | |__|  Holmes’s Copy  |

 

PLEASE READ THIS AGREEMENT CAREFULLY.IT CONTAINS A RELEASE OF KNOWN AND UNKNOWN CLAIMS.

 

ToJeffrey L. Holmes:

 

ThisAgreement establishes the terms under which Manugistics Group, Inc. andits subsidiaries (“Manugistics” or the “Company”) and you have agreed youremployment in the capacity of Executive Vice President and President ofWorldwide Sales will end effective as of the close of business on February 28,2005 (the “Separation Date”) and of your release of Manugistics and othersdescribed below from any claims you might have against any of them related toyour employment and other matters described in the release (the “Release”).

 

Resignation

 

Youhave indicated your agreement to remain employed by Manugistics until theSeparation Date, during which time you will work with Manugistics’ ChiefExecutive Officer (“CEO”) to transition your accounts.  As of the Separation Date you are resigningas an employee, officer, director, and other representative of Manugistics andall of its subsidiaries, except as provided under Services.

 

Services

** **

Youhave agreed to assist Manugistics after the Separation Date in supporting theGovernment, Aerospace and Defense group. In performing these duties, you will report to the person(s) specifiedby the CEO. You will provide such services for no extra compensation during theSeverance Period.  You agree that the CEOmay require you to perform these services during regular office hours at theheadquarters offices of the Company or, as you otherwise agree or as is withinreasonable commuting distance for you, at another office of the Company.  You agree that any expenses you incur inproviding these services are subject to a budget to be approved by the CEO andare subject to the Company’s ordinary procedures for substantiation andreimbursement.

 

CommissionArrangements

 

Manugisticsand you have agreed to certain commission arrangements with respect to certainspecified areas:

 

KeyDefense

 

Manugisticswill pay you a commission of 1% of Net License Revenue and 1% of maintenancerevenue with respect to the deals listed as “Existing Deals” on a list (“DealList”) to be agreed to by the parties. You will have no claim to any commissions or fees with respect to anyExisting Deals except as specified in the preceding sentence.  With respect to deals added by mutual writtenagreement to Deal List after the date of this Agreement (“New Deals”)(including deals with respect to which Manugistics asks for your assistance andthen lists on an amended Deal List), the commission will be 2.5% of Net LicenseRevenue.  For purposes of this Agreement,“Net License Revenue” means license revenue less royalties, agency fees, andany amounts Manugistics is required to spend on research and development for acovered transaction, and “including” means “including but not limited to.”  Payment of commissions under this Key Defenseprovision (i) for all software license transactions will be made 50% onthe recognition of the revenue of the transaction and 50% if and whenManugistics collects its fee with respect to the transaction, and (ii) forall maintenance transactions will be made if and when Manugistics collects thefee with respect to the transaction, and will be payable in accordance withCompany policy on the payment of commissions to employees.  This Key Defense provision for Existing Dealswill apply only to transactions closed before the first anniversary of theSeparation Date.  The expiration of theKey Defense provision for New Deals shall be negotiated by the parties at thetime the Deal List is amended.

 

Other

 

Manugisticswill treat you as its non-exclusive agent in territories to be agreed upon inwriting for the first two years after the date of this Agreement with respectto its Government, Aerospace, and Defense business.  During the Agency Period, you must submit awritten proposal to Manugistics for any transaction you wish to pursue underthis section.  Manugistics, in its solediscretion may accept (an “Accepted Proposal”) or reject a proposal.   Manugistics and you will share the NetLicense Revenue generated from Accepted Proposals at a split of 30% for you and70% for Manugistics. Payment to you under this Other provision is only if andwhen Manugistics collects its fees with respect to the Accepted Proposals.  Manugistics will only reimburse you forpre-approved expenses on Accepted Proposals subject to compliance with theCompany’s ordinary procedures for substantiation and reimbursement.

 

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FurtherConditions

 

Allpayments under this Commission Arrangements section are conditioned on (i) yourcontinued compliance with the terms of this Agreement, including therestrictive covenants contained in it, and (ii) your providingdemonstrable efforts and your being available to support Manugistics’ effortswith respect to the matters covered by the commissions.  These conditions are not intended to preventyour obtaining employment after the Severance Period.

 

Payment

 

Contingentupon the lapse of the Revocation Period without your revoking the Release, theCompany will pay to you, or to your estate in the event of your death, a totalof 26 weeks’ salary in regular payroll intervals as though you hadremained employed for that number of weeks (the “Severance Period”), eachreduced by any federal or state withholding taxes or other required deductionsnormally deducted from your pay (and reduced for any stub pay periods at thebeginning or end of the payments). You agree that, in the absence of thisAgreement, your entitlement to this payment would be uncertain and that yourbenefits under this Agreement are more than adequate consideration for theRelease.  The parties have agreed tothese payments in connection with your resignation to avoid any disputeregarding the terms and conditions of your departure.  On or after your Separation Date, you willalso receive $18,842.31 as accrued vacation pay, increased by any accrualsbefore the Separation Date decreased by any amounts paid or taken as vacationbefore such date of payment under this Agreement.

 

EquityCompensation

 

TheCompany agrees that any restricted stock and stock options you hold for Companystock will continue to vest and be exercisable during the SeverancePeriod.  Vested options will continue tobe exercisable for the 30 days following the end of the Severance Period(subject to any contrary terms of the plans under which they were granted).

 

Limitationson Other Benefits or Compensation

 

Youunderstand and agree that you will receive no other wage, accrued vacation,backpay, bonus, incentive or other compensation, severance, or other paymentsor benefits from Manugistics or affiliates of Manugistics (other than those setforth in this and the Commission Arrangements, Payments, and EquityCompensation provisions), or under Manugistics’ generally available plans(other than any qualified retirement plans). During the Severance Period, you will be entitled to receive thebenefits listed on Exhibit A attached hereto in accordance with Companypolicy for executives at your level as in effect from time to time, subject towhatever generally applicable amendments (or terminations) of such programs theCompany makes during the Severance Period. Following the Severance Period, all benefits will cease except that youwill remain eligible for continued health coverage under Section 4980B ofthe Internal Revenue Code of 1986 at your own expense for the period, if any,required for such coverage.  Manugisticswill reimburse you for rent in the amount of $1,490.00 per month for yourapartment from the Separation Date until June 22, 2005.

 

Effectof Other Employment

 

Youacknowledge and agree that if you become employed by another entity at any pointafter the Separation Date, all payments and benefits under this Agreement willcease as of the effective date of such employment, and the date of suchemployment will be treated as the end of the Severance Period for purposes ofthe Equity Compensation section.  Youagree that you will have received adequate consideration for this Agreementeven if you receive no payments under the Payments section above becauseyou had the opportunity to receive such payments.

 

Releaseof Claims

 

You,for yourself and your heirs, executors, administrators, representatives, andassigns, as a free and voluntary act, release and discharge Manugistics and anyrelated entities including parent, divisions, subsidiaries, or affiliates, andtheir present, former, and future employees, officers, directors, stockholders,counsel, and anyone acting or purporting to act on behalf of any of them, fromany and all debts, obligations, demands, claims, judgments or causes of actionof any kind whatsoever, whether now known or unknown, in tort, in contract, bystatute, or any other basis for compensatory, punitive or other damages,expenses, reimbursements or costs of any kind relating to your employment byManugistics or any associated or affiliated company or the cessation of such employmentrelationship and all circumstances related thereto.  This release and discharge includes, but isnot limited to, any and all claims, demands, rights and/or causes of action,arising up to the date of this Release, including those that might arise out ofallegations relating to any claimed breach of an alleged oral or writtencontract, or any purported employment discrimination or civil rightsviolations, or any alleged acts of slander, libel, or intentional infliction ofemotional distress, and any claims to have been treated unfairly or in a mannercontrary to articles or by-laws as a director or officer of any of theManugistics entities.  Manugisticsspecifically disclaims any liability to, or for wrongful acts against, you orany other person on the part of itself, its shareholders, subsidiaries,affiliates, and successors and the directors, officers, employees and agents ofeach of them.

 

ThisRelease includes but is not limited to a release of any rights or claims youmay have under the Age Discrimination in Employment Act of 1967, as amended (“ADEA”),which prohibits age discrimination in employment; Title VII of the Civil RightsAct of 1964, as amended, which prohibits discrimination in employment based onrace, color, national origin, religion or sex; the Equal Pay Act, whichprohibits paying men and women unequal pay for equal work; the Americans withDisabilities Act of 1990,

 

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whichprohibits discrimination against disabled persons; the VocationalRehabilitation Act of 1973, which prohibits discrimination against handicappedpersons; the Civil Rights Act of 1991, the Maryland Civil Rights Act, and anyother federal, state, or local laws or regulations prohibiting employmentdiscrimination; and any claim for reinstatement.  This also includes your release of any claimsfor wrongful discharge, breach of contract (express or implied), breach of anycovenant of good faith and fair dealing (express or implied), any claims thatManugistics has dealt with you unfairly or has denied you any rights under itspolicies and procedures or any other claims arising under common or civil lawand relating to your employment or termination, and any claims under theEmployee Retirement Income Security Act of 1974, which regulates employeebenefit plans and also prohibits actions taken to discharge or discriminateagainst someone to prevent his exercising any right under an employee benefitplan or to interfere with his attainment of any such right.  It does not release claims under ADEA or onany other basis that arise after the date you sign this Release.

 

Knownand Unknown Claims

 

Toimplement a full and complete release and discharge, you expressly acknowledgethat this Release is intended to include in its effect, without limitation, allclaims you do not know or suspect to exist in your favor at the time ofexecution of this Release.  You agreethat this Release contemplates the extinguishment of any such claim or claims.

 

Periodfor Consideration

 

Youacknowledge that, as ADEA requires, you are being given a period of 21 days toreview and consider the release of claims under ADEA contained in this Releasebefore signing and you have been informed that you may use as much or as littleof this period as you wish before signing. As ADEA also requires, you may revoke (that is, cancel) the release ofADEA claims in this Release before the release becomes effective as toADEA.  ADEA provides a seven day periodfor such revocation, which Manugistics and you agree will start on the day yousign this Release.  You would make thisrevocation by delivering a written notice of revocation to Timothy T. Smith,Manugistics, 9715 Key West Avenue, Rockville, MD 20850.  For this revocation to be effective, Mr. Smithmust receive this notice no later than the close of business on seventh dayfollowing the day you sign this Release. If you revoke the release of claims under ADEA before that deadline,this Release will not be effective or enforceable as to those claims; however,Manugistics will then not pay the final two months specified under Payments.

 

Indemnification

 

Manugisticsagrees that you are not releasing any claims you may have for indemnificationunder state or other law or the charter, articles, or by-laws of Manugisticsand its affiliated companies, or under any insurance policy providing directors’and officers’ coverage for any lawsuit or claim relating to the period when youwere a director or officer of Manugistics or any affiliated company; provided,however, that (i) Manugistics’ execution of this Agreement is not aconcession or guaranty that you have any such rights to indemnification, (ii) thatthis Agreement does not create any additional rights to indemnification, and (iii) thatManugistics retains any defenses it may have to such indemnification or coverage.

 

NoReliance

 

Youacknowledge and agree that, in deciding to execute this Agreement and theRelease, (i) you have relied entirely upon your own judgment, (ii) youhave been advised to and will have the opportunity to consult with legal,financial, and other personal advisors of your choosing as you considerappropriate in assessing whether to execute this Agreement, and (iii) youhave read and fully understood all the terms of this Agreement.  Except as written into this Agreement,neither you nor Manugistics is relying or has relied upon any statements,representations, warranties, or other promises, express or implied, oral orwritten, as to fact or as to law, made by the other party, or any other person,including any attorney or agent of either party, or upon any consideration ofany form received or to be received by any party from any other person,including any attorney or agent of a party.

 

Settlement

 

Theparties have reached this Agreement and Release to, among other things, settleany claims or potential claims relating to your employment or the terminationof your employment that you have or may have against Manugistics and anyrelated entities including parent, subsidiaries, successors, or affiliates, andtheir present, former and future employees, officers, trustees, partners,shareholders, counsel, and anyone acting or purporting to act on behalf of anyof them.  Neither this Agreement nor anyother document or written or oral statement prepared or made in connection withthis Agreement, nor any discussion of the matters referred to in this Agreementnor any payment under this Agreement, constitutes, or should be deemed toconstitute, (A) an admission of law or fact or an admission of anyliability or wrongdoing by you or Manugistics with respect to any claims,unasserted claims, or demands relating to or arising out of or in connectionwith any matter whatsoever (and Manugistics specifically denies any suchliability or wrongdoing) or (B) evidence of any matter whatsoever, exceptfor the agreement expressly set forth in this Agreement.

 

Solicitationof Employees or Clients; Noncompetition

 

Youagree that until the Separation Date and for one year thereafter, you will not,directly or indirectly, (a) solicit the employment of or employ, for yourselfor for any other person or business, any Manugistics employee or any person whowas a Manugistics employee at any time during the one year period preceding theend of the Severance Period, or (b) solicit or attempt to solicit businessfrom, provide services to (in competition with Manugistics), or secureemployment with any person or entity that was, a customer of Manugistics duringyour employment with Manugistics, or any person or business to whom Manugisticshad proposed future work within one year before the end of the Severance Period(as to

 

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whichyou have expended demonstrated efforts), including  those to be agreed to by you and Manugistics,together with any additional clients or customers as to which you may beentitled to compensation under the Commission Arrangements section, or anysystems integrator which could propose a competitive alternative to displaceManugistics at a “government” site where Manugistics products are currentlyinstalled or which proposes to bid or is bidding on any deal listed on the DealList.  As a further protection thatManugistics’ trade secrets and other confidential information will not bedisclosed to its competitors, you agree that you will not accept employment, aseither an employee or consultant, with any competitor of Manugistics listed on Schedule Ito this Agreement within one year following the end of the SeverancePeriod.  You agree that the one yearrestrictive periods in this section will extend to a total of 18 months ifyou receive at least $100,000, before taxes, from the arrangements describedabove under Commission Arrangements. Nothing in this paragraph is to beinterpreted as restraining your freedom to provide services to such customer,business, or person as a bona fide employee so long as Manugistics agrees inwriting that such employment does not utilize knowledge or information youacquired during your tenure with Manugistics, which consent shall not beunreasonably withheld.  If this provisionwere found to be unenforceable, the court so deciding may reduce the timeperiods provided for in this paragraph to allow this provision to be enforced.You understand and acknowledge that Manugistics may communicate the terms orsubstance of this section to any other entity, including ones from which youmay seek employment, without any prior or concurrent notice to you.

 

NoDisparaging Comments

 

Exceptas the law may require, you agree that you will not in any way, directly orindirectly, to any employee of Manugistics or to any other person (includingany communications with the press or other media), make any statement thatcould reasonably be interpreted to criticize or disparage the performance,competency, or ability of Manugistics or its affiliates as a provider ofsoftware or other products and services, or the officers, directors, employees,or agents of any of them at any time after the execution of this Agreement, norwill you do or say anything that likely would have the effect of disrupting orimpairing Manugistics’ normal, ongoing business operations or harmingManugistics’ reputation with its associates, employees, clients, investors,suppliers, dealers, acquisition prospects, or the public.  Except as the law may require, Manugisticsagrees that it will not make any authorized statement to any of its employeesor to any other person (including any communications with the press or othermedia) that could reasonably be interpreted to criticize or disparage yourperformance, competency, or ability at any time after the execution of thisAgreement, and will take reasonable steps to discourage its directors,officers, and employees from making statements inconsistent with thatundertaking.  It will not be a violationof this paragraph for either party to make truthful statements, under oath, asrequired by law or formal legal process or in compliance with the securitieslaws.  This paragraph does not prohibitManugistics or you from communicating any alleged misconduct to appropriatemanagement personnel at Manugistics, to the audit committee of the Board, or toan appropriate governmental entity, or from cooperating with any of theforegoing in any investigation.  Byentering into this agreement, you agree to make yourself available asreasonably requested by Manugistics or the Board’s audit committee inconnection with any such investigation.

 

ClientContacts

 

Throughthe 12 month anniversary of the Separation Date, you agree that, if you arecontacted by any current, former, or prospective clients of Manugistics withrespect to its current or prospective business, you will refer the contactingperson or entity to the CEO for reply or further communications, except as andto the extent that the CEO asks you to respond.

 

Returnof Property

 

Exceptas provided in this section, on or before Separation Date and again on such oneor more dates after such date as Manugistics directs, you agree to deliver toManugistics any office equipment (including computers), keys, and other accessdevices, and any confidential information or other materials (written orotherwise) not available to the public or made available to the public in amanner you know or reasonably should recognize Manugistics did not authorize,and any copies, excerpts, summaries, compilations, records, or documents youmade or that came into your possession during your employment. You agree thatyou will not retain copies, excerpts, summaries, or compilations of theforegoing information and materials.  Youwill return any and all files (whether hard copies or in electronic form).  Manugistics agrees that you may retain theBlackberry and the Dell computer that you have been using, after Manugisticshas removed any trade secrets and confidential information; provided that youshall be responsible for all of the ongoing charges associated with their useand the use of your cell phone from and after the Separation Date.

 

Cooperation

 

Youagree to cooperate with, provide assistance to, and make yourself reasonablyavailable to Manugistics and its legal counsel in connection with anylitigation (including arbitration or administrative hearings) or investigationor examination relating to Manugistics or any of its current or formeremployees, in which, in the judgment of Manugistics or its counsel, yourassistance or cooperation is needed due to your personal involvement in orknowledge about the circumstances to which the litigation or investigationrelates. You will, when Manugistics or its legal counsel requests, providetestimony, be available for interviews or other assistance and travel at Manugistics’request in order to fulfill this obligation. In connection with such litigationor investigation, Manugistics will use its best efforts to accommodate yourschedule, will provide you with as much notice as possible in advance of thetimes during which your cooperation or assistance is needed (but in no eventless than [10] days’ prior notice), and will reimburse you for any reasonableexpenses incurred in connection with such matters.  You agree not to assist or provideinformation to any adverse party in any litigation against Manugistics or anyof its current or former employees, except as required under law or formallegal process, unless you provide advance notice to Manugistics at least [10]days before such assistance or provision of information (or, if

 

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youare so required to assist or provide such information within less than [10]days of receipt of such requirement, after you provide timely advance notice toManugistics) to allow Manugistics to take legal action with respect to thematter. For any cooperation or assistance provided after the Severance Period,Manugistics will pay you an hourly rate computed based on your final basesalary for time spent at the request of Manugistics, other than in depositionsor at trial (for which you will not be paid). Nothing in this Agreement is intended to restrict or preclude you from,or otherwise influence you in, testifying fully and truthfully in legal,administrative, or any other proceedings involving Manugistics, as required bylaw or formal legal process.

 

EntireAgreement and Continuing Obligations

 

ThisAgreement is the entire agreement between (i) you and (ii) Manugistics andthe other parties released by this Agreement, with respect to your employment,other than the Code of Conduct, Conditions of Employment, and the documentsunderlying your option and restricted stock grants (as amended hereby).  You hereby affirm your continuing obligationsunder the Code of Conduct and Conditions of Employment and further agree thatthose continuing obligations will also cover the matters in Sections 3, 4, and7 of the Conditions of Employment as though you remained employed after theSeparation Date through the date your services to Manugistics cease.  You acknowledge that your obligations underthe preceding sentence continue indefinitely for any matters covered during theperiods to which that sentence applies. Any other prior agreements, oral or written, between you and Manugisticsand its affiliated companies are hereby terminated as of the Separation Dateand shall have no further force or effect, other than the agreements listed inthe preceding sentence.

 

BindingEffect

 

ThisAgreement binds any and all successors and assigns of Manugistics and yourheirs and beneficiaries.

 

Withholding

 

Allpayments under this Agreement will be reduced by any federal or statewithholding taxes or other required deductions.

 

Arbitration

 

Manugisticsand you agree that the Arbitration provisions of the Conditions of Employmentremain in place and will also govern any dispute regarding this Agreement.

 

GoverningLaw

 

Thelaws of the State of Maryland (other than its conflict of laws provisions)govern this Agreement.

 

Effectiveness

 

ThisAgreement does not become effective until it has been executed and delivered byboth Manugistics and you.

 

Signatures on Page Following

 

THIS IS A RELEASE — READ CAREFULLY BEFORE SIGNING.YOU SHOULD CONSULT WITH AN ATTORNEY.

 

Youacknowledge that you have read this Agreement, understand it, and arevoluntarily entering into it.

 
|   |          | Manugistics Group, Inc. |
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Acceptedand agreed to:

 

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|                                       |                |              |   | /s/ |   |   |
|--------------------------------------------|---------------------|-------------------|--------|-----|--------|--------|
|      Date  Signed |                | Jeffrey L. Holmes |
|                                       |                |              |
|                                       |                |              |
|                                       | Witness:            |              |
|                                       |                |              |
|                                       |  Signed:       |              |   |
|                                       |  Date  Signed: |              |   |
|                                       | Name:               |              |   |
|                                            |                     |                   |        |     |        |        |  |  |  |

 

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Holmes AgreementSchedule ICompetitors

 

Thereference to any entities listed below is also a reference to their successorsand assigns, whether by asset sale, transfer, merger, or acquisition.

 

i2 Technologies, Inc.SAP, AGOracleLogilityGLogRed PrairieManhattan AssociatesDemantraXelus

 

 

Exhibit A

 
| Life  Insurance Company              |   | Amount  of Benefit                                                                                                                                                                                                            |   |
|--------------------------------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
| First  Colony Life Insurance Company |   | $700,000  - 10 year individual term policy – Post severance you can take this policy  with you at the individual rate during the balance of the policy’s term.  (Extension requires involvement of Human Resources) |   |

 
| Health  and Medical Coverage |   | Level  of Coverage    |   | Portable                                                                       |   |
|------------------------------|--------|-----------------------|--------|--------------------------------------------------------------------------------|--------|
| Standard  Plan PPO/Non-PPO   |   | Employee  + Dependent |   | COBRA  coverage at your expense (beginning at the end of the Severance Period) |   |

 

401(k)Plan

 

Activeparticipation ends on Separation Date. Account can remain in plan in accordance with plan terms and tax laws.

 

ProfessionalServices

 

Thisbenefit will continue during the severance period for preparation and filing oftax returns for 2004.

 

PhysicalExam

 

Manugistics, Inc.will reimburse you up to $1,800.00 for the cost of one comprehensive physicalexam for you performed at any time during the Severance Period.

 

AdditionalLife Insurance Coverage:

 

Inaddition to the First Colony Life Insurance Company policy described above,Manugistics, Inc. will reimburse you up to $1,000.00 for the cost of newlife insurance premiums on policies you obtain on your life to cover you duringthe Severance Period.

 

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