Exhibit 10.1


 


 


AMENDED
AND RESTATED EMPLOYMENT AGREEMENT


 


THIS AMENDED AND
RESTATED EMPLOYMENT AGREEMENT (the “Agreement”), is made and entered into this 3rd
day of December, 2004 (the “Effective Date”) by and between Vastera, Inc., a
Delaware corporation with its principal place of business at 45025 Aviation
Drive, Dulles, VA  20166 (“Vastera” or the “Company”), and
Timothy A. Davenport (“Davenport”
or the “Employee”).


RECITALS


WHEREAS, Employee
has been, and is currently, employed by the Company in a critical managerial
position with the Company;


WHEREAS, on February
13, 2004 the Company and Employee entered into that certain Employment
Agreement (the “Employment Agreement”) setting
for the basic terms and conditions of Employee’s employment with the Company;
and


WHEREAS, the
Company believes it to be in the best interest of the Company to modify and
increase the Severance Amount to be paid to the Employee to provide a greater
incentive to the Employee to remain employed by the Company for a period of
time sufficient to enable the Company to execute upon its long-range business
plans.


AGREEMENT


NOW, THEREFORE, in
consideration of the mutual covenants and promises contained herein, and other
good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:


1.             Term of Employment.  The Company hereby agrees to employ the
Employee, and the Employee hereby accepts employment with the Company, upon the
terms set forth in this Agreement, for the period commencing on the Effective Date and
ending on December 31, 2004 (such time period being referred to as the “Initial Term”).  This Agreement shall automatically renew in
one-year increments (each such one-year period being referred to as a “Renewal Term”), unless no later than
90 days prior to the expiration of the Initial Term or any Renewal Term one
Party notifies the other Party in writing of its intention not to renew for an
additional Renewal Term.  The Initial
Term and each and all Renewal Terms are collectively referred to as the “Employment Period”.


2.             Title; Capacity.  The Employee shall serve as President and
Chief Executive Officer of Vastera and as an officer or director of such of
Vastera’s direct or indirect and wholly owned or partially owned subsidiaries
as the duties of the Employee may require from time to time.  The Employee shall be based at the Company’s
headquarters in Dulles, Virginia or such other place within a 40-mile radius
thereof, as may be reasonably requested by the Company.


 





















 


The Employee shall
be subject to the supervision of, and shall have such authority as is delegated
to him by, the Board of Directors (the “Board”).


The Employee
hereby accepts such employment and agrees to undertake the duties and
responsibilities inherent in such position and such other duties and
responsibilities as the Company’s Board shall from time to time reasonably
assign to him.  Except during the Stub
Period (defined herein below), the Employee agrees to devote his entire
business time, attention and energies to the business and interests of the
Company during the Employment Period; provided that for reasonable periods of
time each month the Employee may engage in non-competitive business or
charitable activities, such as activities involving, educational, religious and
similar types of organizations, speaking engagements, membership on the board
of directors of such other organizations to which the Company may from time to
time agree, and similar types of activities so long as such activities do not
interfere with the Employee’s responsibilities hereunder.  The Employee agrees to abide by the rules,
regulations, instructions, personnel practices and policies of the Company and
any changes therein that may be adopted from time to time by the Company.  The Employee acknowledges receipt of copies
of all such rules and policies committed to writing as of the Effective Date.


3.             Compensation and Benefits.


3.1           Salary.  Beginning on the Effective Date, the Company
shall pay Employee an annual salary of $350,000 (such amount being referred to
as Employee’s “Base
Salary”).  All amounts to
be paid to Employee hereunder shall be paid semi-monthly, or in such other
manner that is in accordance with the Company’s standard payroll practices,
prorated for any partial compensation period. 
Such Base Salary shall be subject to upward adjustment thereafter by the
Board or by the Compensation Committee if such duties have been delegated
thereto by the Board.


3.2           Annual Review of Employee’s
Aggregate Compensation.  The Board or
the Compensation Committee shall review the Employee’s aggregate compensation
no less frequently than once per annum. 
Such reviews shall take into consideration any changes in the Employee’s
duties, responsibilities, increases in the general and regional cost of living,
the Employee’s prior year performance, and such other factors as the Board or
the Compensation Committee shall deem germane to the review.  Based on the results of such review(s) the
Board or the Compensation Committee may adjust the Employee’s Base Salary, the
Employee’s Annual Bonus, or any combination thereof upward.


3.4             Fringe Benefits.  The Employee shall be entitled to participate
in all benefit programs that the Company has established as of the Effective
Date and such benefit plans as the Company may subsequently establish, modify,
amend, or alter and makes available to its employees, if any, to the extent
that Employee’s position, tenure, salary, age, health and other qualifications
make him eligible to participate.  The
Employee shall be entitled to paid leave in accordance with the Company’s
vacation and leave policies.


 


2





















 


3.5           Stock Option Plan and Employee
Stock Purchase Plan.  The Employee
shall be entitled to participate in the Company’s 2000 Stock Incentive Plan
(the “Option Plan”)
and the 2000 Employee Stock Purchase Plan (the “ESPP”).


3.6           Reimbursement of Expenses.  The Company shall reimburse the Employee for
all reasonable travel, entertainment and other expenses incurred or paid by the
Employee in connection with, or related to, the performance of [his/her]
duties, responsibilities or services under this Agreement, upon presentation by
the Employee of documentation, expense statements, vouchers, and such other
supporting information as the Company may request, or as may be consistent with
standard company practices, provided, however, that the amount available for
such travel, entertainment and other expenses may require approval in advance
or may be fixed in advance by the Board.


4.             Employment Termination.  The employment of the Employee by the Company
pursuant to this Agreement shall terminate upon the occurrence of any of the
following:


4.1             Expiration of the Employment Period
in accordance with Section 1;


4.2             At the election of the Company, “for cause”,
immediately upon written notice by the Company to the Employee.  For the purposes of this Section 4.2,
termination for cause shall be
deemed to exist upon:


(a)                                        the conviction of the Employee of, or the
entry of a pleading of guilty or nolo contendere by the Employee to, any crime
involving moral turpitude that may reasonably adversely reflect on the Company
or any felony;


(b)                                       willful misconduct in connection with the
Employee’s duties or willful failure to use reasonable effort to perform
substantially his responsibilities in the best interest of the Company
(including, without limitation, breach by the Employee of this Agreement),
except in cases involving the mental or physical incapacity or disability of
the Employee; provided  however, that the Board may terminate the
Employee’s employment pursuant to Section 4.2(b) only after the failure by the
Employee to correct or cure, or to commence and continue to pursue the
correction or curing of, such refusals within 30 days after receipt by the
Employee of written notice by the Board of each specific claim of any such
misconduct or failure.  The Employee
shall have the opportunity to appear before the Board to discuss such written
notice during such 30-day period.  “Willful misconduct”
and “willful failure to
perform” shall not include actions or inactions on the part of
the Employee that were taken or not taken in good faith by the Employee; and


(c)                                        fraud, material dishonesty, or gross
misconduct in connection with the Company perpetuated by the Employee.


 


3





















 


4.3           Upon the death or 30 days after the
disability of the Employee.  As used in
this Agreement, the term “disability” shall mean the inability of the Employee,
due to a physical or mental disability, for a period of 180 days, regardless of
whether consecutive, during any 360-day period to perform the services
contemplated under this Agreement.  A
determination of disability shall be made by a physician satisfactory to both the
Employee and the Company, provided that if the Employee and the Company do not
agree on a physician, the Employee and the Company shall each select a
physician and these two together shall select a third physician, whose
determination as to disability shall be binding on all parties;


4.4           At the election of the Employee, upon
not less than 30 days prior written notice of termination other than for “good
reason” as defined below; or


4.5           At the election of the Company,
otherwise than for cause, upon not less than 10 business days prior written
notice or at the election of the Employee for “good reason” upon not less than 20
business days prior written notice of termination.  Good reason shall be deemed to exist when there
occurs: (A) a material breach of this Agreement by the Company; (B) any
reduction in the Employee’s level of compensation without the approval of the
Employee; or (C) a transfer of the Employee’s work location for purposes of
performing his duties hereunder to a location that is beyond a 40-mile radius
from the Company’s current headquarters location in Dulles, Virginia.


5.             Effect of Termination.


5.1           Termination for Cause or at the
Election of the Employee.  In the
event the Employee’s employment is terminated for cause pursuant to Section 4.2,
or at the election of the Employee pursuant to Section 4.4, the Company shall
pay to the Employee the compensation and benefits otherwise payable to him
under Section 3 through the last day of his actual employment by the Company.


5.2           Termination for Death or
Disability.  If the Employee’s
employment is terminated by death or because of disability pursuant to Section
4.3, the Company shall pay to the estate of the Employee or to the Employee, as
the case may be, the compensation which would otherwise be payable to the
Employee up to the end of the month in which the termination of his employment
because of death or disability occurs.


5.3           Termination at the Election of the
Company or the Employee for Good Reason. 
If the Employee’s employment is terminated at the election of the
Company, otherwise than for cause, or by the Employee for good reason pursuant
to Section 4.5, subject to this Section 5.3, the Company shall pay to Employee
an aggregate severance amount of $950,000 (such amount being referred to as the
“Severance Amount”).  The Severance Amount shall be paid in a single
lump sum amount, and such payment shall be contingent upon the Employee signing
a Release and Waiver Agreement substantially in the form attached hereto as Exhibit
A.  In addition to the Severance
Amount, the


 


4





















 


Company shall
provide Employee with full medical, dental, and vision benefits through the
sixth full month following the date of Employee’s termination.


5.4           Change of Control Event.


In addition to the
severance payment obligations set forth in Section 5.3 above, if


(i)                                 a Change of Control Event
(as defined hereinbelow) occurs and


(ii)                              the Employee’s employment with the
Company following such Change of Control Event is maintained for a period of 3
months (such 3-month period of time being referred to as the “Initial Retention
Period”),


the Employee shall
have the option to terminate his employment without good reason
during the period that commences on the expiration of the Initial Retention
Period described in subcaluse (ii) above and expires 30 days thereafter (the “Window Period”); provided, however,
that the Employee must deliver to the Company no less than two weeks’ advance
written notice of his election to terminate his employment during the Window
Period under this Section 5.4.  Such
two-week’s advance notice may be delivered prior to the expiration of the
Initial Retention Period.  If the
Employee terminates his employment without good reason
at anytime during the Window Period with the requisite two weeks’ advance
written notice, the Company shall be required to pay the Severance Amount and
honor all other terms and conditions of this Agreement.


5.5           Extension of Option Exercise Period;
Acceleration of Option Vesting.


(a)                           Notwithstanding
anything to the contrary contained in the exercise provisions of any of
Employee’s existing agreements governing the granting and exercising of options
to purchase shares of the Company’s Common Stock, irrespective of whether such
options are incentive stock options (“ISO”s) or nonstatutory stock options (“Nonquals”) or any
such agreements executed by the Employee and the Company subsequent to the
Effective Date, the Company agrees that Employee shall have six-months from the
Employee’s termination date in which to exercise all options that are vested as
of the date upon which Employee’s employment was terminated, subject to any
trading window requirements or other restrictions imposed under the Company’s
insider trading policy.  This subsection
5.5(a) hereby (i) amends and shall be deemed an amendment to the exercise
provisions of each and every existing agreement of Employee’s governing the
granting and exercising of options (both ISO and Nonqual) and (ii) is deemed
incorporated by reference into any agreement between the Employee and the
Company governing the granting and exercising of options (both ISO and Nonqual)
executed subsequent to the date hereof, as though such provision were restated
therein in their entirety.


 


5





















 


(b)                           Notwithstanding
anything to the contrary contained in the exercise provisions of any of
Employee’s existing agreements governing the granting and exercising of ISOs
and Nonquals, if during the Employment Period a Change of Control Event (as
defined below) occurs, 100% of the unvested portion of all options held by
Employee as of the date of Change of Control Event shall be deemed vested and
Employee shall be entitled to exercise such options during the time period
described in subsection 5.5(a).  For
purposes of this section 5.5(b) a “Change of Control Event” shall be deemed to
exist if there occurs either:


(i)                                     a merger or
consolidation in which securities possessing more than fifty percent (50%) of
the total combined voting power of the Company’s outstanding securities are
transferred to a person or persons different from the persons holding those
securities immediately prior to such transaction, or


(ii)                                  the sale,
transfer or other disposition of all or substantially all of the Company’s
assets in complete liquidation or dissolution of the Company.


5.6           Gross Up for Tax Treatment. 
The Company agrees that if


(A)                              because of the operation of any of the
provisions of this Agreement, the payments to be made to Employee and the acceleration
of option vesting hereunder are deemed “golden parachute payments” under the Internal
Revenue Code of 1984, as amended, and


(B)                                      Employee is obligated to pay an excise
tax associated with such golden parachute
payments,


the Company shall
reimburse the Employee in full for both (i) the amount of any such excise tax
owed upon such golden parachute payments and (ii) any excise or ordinary income
taxes owed in connection with the payment of the amount described in the
preceding clause (i) (such payments being referred to as the “gross up amounts”).


5.7           Survival.  The provisions of Sections 6 and 7 shall
survive the termination of this Agreement.


6.             Non-Compete.


6.1           So long as the Company is not in
breach of this Agreement, during the Employment Period and for a period of one
year after the termination or expiration thereof, the Employee will not
directly or indirectly as an individual proprietor, partner, stockholder,
officer, employee, director, joint venturer, investor, lender, or in any other


 


6





















 


capacity
whatsoever (other than as the holder of not more than 5% of the total
outstanding stock of a publicly held company), engage in the business of
providing global trade management services as performed by the Company on the
date of termination of Employee’s employment within a 40-mile radius of Dulles,
Virginia.


6.2           So long as the Company is not in
breach of this Agreement, during the Employment Period and for a period of one
year following the termination or expiration thereof, the Employee will not
directly or indirectly:


(a)           as an individual
proprietor, partner, stockholder, officer, employee, director, joint venturer,
investor, lender, or in any other capacity whatsoever (other than as the holder
of not more than 5% of the total outstanding stock of a publicly held Company),
engage in the business of developing, producing, marketing or selling software
or providing services of the kind or type developed or being developed,
produced, marketed or sold by the Company or its affiliates while the Employee
was employed by the Company; or


(b)           recruit, solicit or induce, or
attempt to induce, any employee or employees of the Company or its affiliates
to terminate their employment with, or otherwise cease their relationship with,
the Company or its affiliates; or


(c)           solicit, divert or take away, or
attempt to divert or to take away, the business or patronage of any of the
clients, customers or accounts, or prospective clients, customers or accounts,
of the Company or its affiliates which were contacted, solicited or served by
the Employee while employed by the Company.


6.3           The parties agree that the relevant
public policy aspects of covenants not to compete have been discussed, and that
every effort has been made to limit the restrictions placed upon the Employee
to those that are reasonable and necessary to protect the Company’s legitimate
interests.


6.4           If any restriction set forth in this
Section 6 is found by any court of competent jurisdiction to be unenforceable because
it extends for too long a period of time or over too great a range of
activities or in too broad a geographic area, it shall be interpreted to extend
only over the maximum period of time, range of activities or geographic area as
to which it may be enforceable.


6.5           The restrictions contained in this
Section 6 are necessary for the protection of the business and goodwill of the
Company and/or its affiliates and are considered by the Employee to be
reasonable for such purposes.  The
Employee agrees that any breach of this Section 6 will cause the Company and/or
its affiliates substantial and irrevocable damage and therefore, in the event
of any such breach, in addition to such other remedies which may be available,
the Company shall have the right to seek specific performance and injunctive
relief.  The Employee acknowledges that he
has received compensation for


 


7





















 


the terms of this
Section 6 pursuant to various stock option agreements and other compensation.


 


7.             Proprietary
Information and Developments.


 


                                7.1           Proprietary Information.


 


(a)           The Employee agrees that all
information and know-how, regardless of whether in writing, relating to the
business, technical or financial affairs of the Company and that is generally
understood in the industry as being trade secret, confidential and/or
proprietary, that is designated as being confidential or proprietary
information of the Company, either verbally or in writing, or that is
designated as representing trade secrets of the Company, either verbally or in
writing (collectively, “Proprietary
Information”), is and shall be the exclusive property of the
Company.  For purposes of this Agreement,
Property Information shall mean, by way of illustration and not limitation, all
information and know-how (regardless of whether patentable and regardless of
whether copyrightable) owned, posses or used by the Company, including, without
limitation, any invention, existing or future product, formula, method,
manufacturing techniques and procedures, composition, compound, project,
development, plan, vendor information, supplier information, customer
information, apparatus, equipment, trade secret, process, research, reports,
clinical data, financial data, technical data, test data, know-how, computer
program, software, software documentation, hardware design, technology,
marketing or business plan, forecast, unpublished financial statement, budget
license, patent applications, contracts, joint ventures, price, cost and
personnel data.


 


(b)           The Employee agrees not to and will
not disclose any Proprietary Information to others outside the Company or use
the same for any unauthorized purposes without written approval by an officer
of the Company, from the Effective Date, during or after his employment unless
and until such Proprietary Information (i) has become public knowledge through
legal means without fault by the Employee, or (ii) is already public knowledge
prior to the signing of this Agreement.


 


(c)           The Employee agrees that all files,
letters, memoranda, reports, records, data, schematics, sketches, drawings,
laboratory notebooks, program listings, computer programs, databases, products,
test equipment, prototypes or other written, photographic, magnetic or other
tangible material containing or embodying Proprietary Information, whether
created by the Employee or others, which shall come into his custody or
possession (hereinafter collectively referred to as the Company Records) shall
be, shall continue to be and are the exclusive property of the Company to be
used by the Employee only in the performance of his duties for the
Company.  All such Company Records or
copies thereof and all


 


8





















 


other tangible property of the Company in the custody
or possession of the Employee shall be delivered to the Company, upon the
earlier of (i) a request by the Company or (ii) termination of this
Agreement.  After such request,
termination or delivery, the Employee agrees not to and shall not retain any
such Company Records or copies thereof or any such other tangible property.


 


7.2           Developments.


 


(a)           The Employee agrees to make and will
make full and prompt disclosure to the Company of all inventions, know-how,
improvements, product ideas, new products, discoveries, methods, developments,
software, and works of authorship, whether or not patentable and whether or not
copyrightable, and all other intellectual property rights, including but not
limited to patents, copyrights, copyrightable works, trade secrets and
trademarks, and all books, schematics, magnetic files and written records
related thereto which are or were created, made, conceived, reduced to practice
by or became owned by the Employee or under his direction or jointly with
others either (i) during his employment whether or not during normal working
hours or on the premises of the Company, or (ii) prior to his employment by the
Company if used by the Company during his employment by the Company, in either
event, to the extent relevant to the Company’s business, including but not
limited to, its techniques, developments, projects or products (all of which,
whether disclosed or not, are collectively referred to in this Agreement as “Developments”).


 


(b)           The Employee agrees to assign and
does hereby assign, convey and transfer to the Company (or any person or entity
designated by the Company) all his rights, title and interest in and to all
Developments; provided that the Employee may use Developments described in
(a)(ii) above in a manner that complies with terms set forth in Section 6
(Non-Compete) and Section 7.1 (Proprietary Information) hereof.


 


(c)           The Employee agrees to cooperate
fully with the Company, both during and after his employment with the Company,
with respect to the worldwide procurement, maintenance and enforcement,
including assistance or cooperation in legal proceedings, of copyrights,
patents and similar protections (both in the United States and foreign
countries) relating to Developments; and, if such cooperation by the Employee
is required after the Employee has ceased to be employed by the Company, then
the Company will reimburse the Employee for any expenses reasonably incurred by
Employee in connection with such cooperation. 
The Employee shall sign all papers, copyright applications, assignments,
declarations, powers of attorney, patent applications, and other related or
necessary documents, which the Company may deem necessary or desirable in order
to enforce and/or protect its rights and interests in any Developments or any
Proprietary Information.


 


9





















 


7.3           Other Agreements.  Employee hereby represents that he is not
bound by the terms of any agreement with any previous employer or other party
to refrain from using or disclosing any trade secret or confidential or
proprietary information in the course of his employment with the Company or to
refrain from competing, directly or indirectly, with the business of such
previous employer or any other party. 
Employee further represents that his performance of all the terms of
this Agreement and as an employee of the Company does not and will not breach
any agreement to keep in confidence proprietary information, knowledge or data
acquired by him in confidence or in trust prior to his employment with the
Company.


7.4           Company and Affiliates.  Where the term “Company” is used in this Section 7 it
will be deemed to include any affiliate of the Company, including but not
limited to Vastera, Inc.


8.             Notices.  All notices required or permitted under this
Agreement shall be in writing and shall be deemed effective upon delivery
personally, by facsimile or by overnight mail, or upon deposit in the United
States Post Office, by registered or certified mail, postage prepaid, addressed
to the other party at the address shown above, or at such other address or
addresses as either party shall designate to the other in accordance with this
Section 8.


9.             Pronouns.  Whenever the context may require, any
pronouns used in this Agreement shall include the corresponding masculine,
feminine or neuter forms, and the singular forms of nouns and pronouns shall
include the plural, and vice versa.


10.           Entire Agreement.  This Agreement and the exhibits hereto
constitutes the entire agreement between the parties and supersedes all prior
agreements and understandings, whether written or oral, relating to the subject
matter of this Agreement.


11.           Amendment.  This Agreement may be amended or modified
only by a written instrument executed by both the Company and the Employee.


12.           Governing Law.  This Agreement shall be construed,
interpreted and enforced in accordance with the laws of the Commonwealth of
Virginia.


13.           Successors and Assigns.  This Agreement shall be binding upon and
inure to the benefit of both parties and their respective successors and
assigns, including any corporation with which or into which the Company may be
merged or which may succeed to its assets or business, provided, however, that
the obligations of the Employee are personal and shall not be assigned by him.


14.           Trial by Jury.  The parties agree that they have waived their
right to a jury trial with respect to any controversy, claim, or dispute
arising out of or relating to this Agreement, or the breach thereof, or arising
out of or relating to the employment of the Employee, or the termination
thereof, including any claims under federal, state, or local law, and that any
such


 


10





















 


controversy,
claim, or dispute shall be heard and adjudicated in the state courts of the
Commonwealth of Virginia, in Fairfax County.


15.           Miscellaneous.


15.1         No delay or omission by the Company in
exercising any right under this Agreement shall operate as a waiver of that or
any other right.  A waiver or consent
given by the Company on any one occasion shall be effective only in that
instance and shall not be construed as a bar or waiver of any right on any
other occasion.


15.2         The captions of the sections of this
Agreement are for convenience of reference only and in no way define, limit or
affect the scope or substance of any section of this Agreement.


15.3         In case any provision of this Agreement
shall be invalid, illegal or otherwise unenforceable, the validity, legality
and enforceability of the remaining provisions shall in no way be affected or
impaired thereby.


15.4         This Agreement is effective as of the
date of execution of this Agreement, will survive Employee’s employment with
the Company, and does not in any way restrict Employees right or the right of
the Company to terminate Employee’s employment.


15.5         Employee certifies and acknowledges
that he has carefully read all of the provisions of this Agreement and that she
understands and will comply fully and faithfully with its provisions.


 


11





















 


IN WITNESS
WHEREOF, the parties hereto have executed this Employment Agreement as of the
day and year set forth above.


 


 


	
  VASTERA, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
  By: 

  	
   

  
	
   

  	
  Brian D. Henderson

  
	
   

  	
  Chief Counsel

  
	
   

  	
   

  
	
   

  	
   

  
	
  By: 

  	
   

  
	
   

  	
  Maria Henry

  
	
   

  	
  Chief Financial Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
  EMPLOYEE

  
	
   

  	
   

  
	
   

  
	
  Timothy A. Davenport

  
			



 


12