exv10w16



 





Exhibit 10.16




EMPLOYMENT
AGREEMENT




     THIS
EMPLOYMENT AGREEMENT (this “Agreement”) is entered into by and
between ECLIPSYS CORPORATION, a Delaware corporation
(“Company”), and PAUL L.
RUFLIN, an individual (“Executive”), effective
February 3, 2004 (“Effective
Date”).



WITNESSETH:




     WHEREAS, Executive has been serving as the Chief Executive Officer of
Company pursuant to the terms of an offer letter dated May 5,
2002 (the “Offer
Letter”); and



     WHEREAS, Executive commenced employment with Company on July 15, 2002 (the
“Commencement Date”); and



     WHEREAS, Company and Executive contemplated at the time of the Offer
Letter that they would enter into a more formal employment agreement; and



     WHEREAS, Company desires to continue to employ Executive, and Executive
desires to continue to be employed by Company;



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



     Section 1 - Employment.




	 	(a)	 	Company agrees to continue to employ Executive as its Chief
Executive Officer, and Executive shall have the customary powers,
responsibilities and authorities of a Chief Executive Officer. In
this capacity, Executive shall report to the Board of Directors of
Company (the “Board”). Executive agrees to devote his best efforts
to the performance of his duties and responsibilities hereunder,
subject at all times to review and control of the Board.






	 	(b)	 	Nothing in this Agreement shall preclude Executive from
engaging in charitable and community affairs, from managing any
passive investment (i.e., an investment with respect to which
Executive is in no way involved with the management or operation of
the entity in which Executive has invested) made by him in publicly
traded equity securities or other property (provided that no such
investment may exceed five percent (5%) of the equity of any entity,
without the prior approval of the Board) or from serving, as a
member of boards of directors or as a trustee of any other
corporation, association or entity, to the extent that any of the
above activities do not




 









 






	 	 	 	interfere with his ability to discharge his duties hereunder and
the subject entity does not directly compete with Company.





     Section 2
— Term of Employment. Executive’s term of employment under this
Agreement (“Term of Employment”) commenced on the Commencement Date and,
subject to the terms hereof, shall terminate on the date that either party
terminates Executive’s employment under this Agreement.



     Section 3 — Compensation.




	 	(a)	 	Salary. During the period from the Commencement Date through
July 15, 2004 (the “Initial Period”), Company shall pay Executive at
the annualized rate of Seven Hundred Fifty Thousand Dollars
($750,000.00) (“Base Salary”), in bi-weekly payments of Twenty Eight
Thousand Eight Hundred Forty Six and 15/100 Dollars ($28,846.15).
Base Salary shall be payable in accordance with the ordinary payroll
practices of Company and shall be subject to all applicable federal,
state and local withholding and reporting requirements. Executive’s
Base Salary shall not be decreased during the Initial Period.
During the Term of Employment, the Board shall review, and may,
subject to the immediately preceding sentence, adjust Executive’s
Base Salary annually, in accordance with Company’s customary
procedures and practices for reviewing compensation of senior
executives.






	 	(b)	 	Eclipsys Executive Compensation Program
(“EECP”). Executive
shall be eligible to participate in the EECP, subject to all the
terms and conditions of such plan, as such plan may be modified from
time to time; provided, however, that Executive’s annual target
bonus under the EECP (the “Target Bonus”) shall initially be at
least Two Hundred Fifty Thousand Dollars ($250,000.00) , with the
actual bonus earned being based on achieving such performance
targets and management objectives as may be established by the Board
or the Compensation Committee of the Board each year as contemplated
by the EECP. Executive’s Target Bonus shall not be decreased during
the Initial Period.





     Section 4
- Employee Benefits.




	 	(a)	 	Employee Retirement Benefit Programs, Welfare Benefit
Programs, Plans and Practices. Company shall provide Executive with
coverage during the Term of Employment under any retirement benefit
programs, welfare benefit programs, plans and practices, that
Company makes available to its senior executives, including, but not
limited to, its life and short- and long-term disability insurance,
hospitalization and major medical insurance, Company 401(k) Plan,
Employee Stock Purchase Plan, dental insurance, directors and
officers liability insurance, and any other nonqualified
compensation program (including deferred compensation or
supplemental retirement programs) as in effect from time to time.




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	 	(b)	 	Vacation. Executive shall be entitled to five weeks of paid
vacation each calendar year, which shall be taken at such times as
are consistent with Executive’s responsibilities hereunder;
provided, however, that Executive shall not be entitled to carry
over unused vacation from year to year in an amount exceeding that
which Executive would be entitled to carry over in accordance with
Company’s standard vacation policy as applied to employees of
Executive’s longevity with Company.
	 
	 	(c)	 	Relocation and Travel Expenses. Company shall pay all
reasonable and customary costs related to the relocation of his
family and the family residence to Florida (or other location of
the Company’s corporate headquarters if it is relocated) at such
time during the Term of Employment as Executive decides such a move
is appropriate. The costs included in the relocation cost to be
paid by the Company shall include, without limitation, all moving
costs; all expenses relating to the sale of Executive’s Ohio
residence, such as brokerage commissions and closing costs; all
expenses relating to travel between Ohio and Florida (or other
corporate headquarters location) relating to such relocation; and
reimbursement of any nonrefundable deposits that are forfeited by
Executive on account of the relocation. Executive acknowledges that
during the Term of Employment he shall be required to travel
extensively to meet with customers, prospects, investors and Company
employees in order to perform his duties hereunder, and that Company
shall bear all the reasonable costs and expenses of such travel,
including travel to and from his family’s residence for business
purposes.





     Section 5
- Expenses. Subject to prevailing Company policy or such
guidelines as may be established by the Board from time to time, in addition to
the travel costs and expenses referred to in 4(c) above, Company shall
reimburse Executive for all reasonable expenses incurred by Executive in
carrying out his duties.



     Section 6
- Termination of Employment.




	 	(a)	 	Termination Without Cause or Termination for Good
Reason.
If Executive’s employment is terminated during the Term of
Employment by Company for any reason other than Cause (as defined in
Section 6(c) hereof), Executive’s Disability (as defined in Section
6(e) hereof), or Executive’s death, or if Executive’s employment is
terminated during the Term of Employment by Executive for Good
Reason (as defined in Section 6(a)(2) hereof), then Company shall
pay Executive (x) the Accrued Amounts (as defined below) and (y)
subject to the following sentence, the Severance Package. The
payment of the Severance Package to Executive under this Section
6(a) shall (i) be contingent upon the execution by Executive of
Company’s standard release agreement then in effect and (ii)
constitute the sole remedy of Executive in the event of a
termination of Executive’s employment in the circumstances set forth
in this Section 6(a). The Accrued Amounts shall be payable




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	 	 	 	in a lump sum within ten (10) days of termination of employment.






	 	(1)	 	For purposes of this Agreement, the “Accrued
Amounts” shall mean Executive’s Base Salary, any declared but
unpaid bonus and any other earned but unpaid amounts payable
to him hereunder, in each case as accrued through the last
day of his actual employment by Company.






	 	(2)	 	For purposes of this Agreement, a termination
of employment by Executive for “Good Reason” shall be a
termination by Executive following the occurrence of any of
the following events unless Company has cured as provided
below:






	 	(A)	 	Removal from the position of Chief
Executive Officer of Company prior to a Change of
Control (as defined in Section 6(d)(4)), except for
Cause or following Executive’s death or Disability;






	 	(B)	 	Prior to or following a Change of
Control, any material diminution in Executive’s duties
or responsibilities, except for Cause or following
Executive’s death or Disability; or






	 	(C)	 	Prior to a Change of Control, a
material reduction in the Base Salary or a material
reduction in the other benefits (other than the Target
Bonus) provided to Executive by Company; or






	 	(D)	 	Following a Change of Control, a
material reduction in the Base Salary or Target Bonus, a
material change in the criteria for measuring the amount
of bonus Executive will be entitled to, or a material
reduction in the other benefits provided to Executive by
Company; or






	 	(E)	 	Prior to or following a Change of
Control, a required relocation of Executive’s primary
residence any time after he and his family relocate to
Florida.






	 	 	 	Executive must notify Company in writing specifically
identifying any event constituting Good Reason within thirty
(30) days after Executive becomes aware of such event or such
event shall not constitute Good Reason for purposes of this
Agreement; provided that Company shall have thirty (30) days
from the date of such notice to cure the Good Reason event.
A termination by Executive following cure shall not be a
termination for Good Reason. A failure of Executive to
notify Company after the first occurrence of an event
constituting Good Reason shall not preclude any subsequent
occurrences of such event (or similar event) from
constituting Good Reason.




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	 	 	 	The parties acknowledge that, although Executive is currently
serving both as President and as Chief Executive Officer of
Company, it shall not constitute Good Reason if the Board
elects to award the title of President to a Company employee
other than Executive, or if the Board elects to assign the
duties normally associated with a chief operating officer to
a Company employee other than Executive. In this regard,
Company acknowledges that Executive would expect to be
consulted by the Board before either of these actions were
taken, but Executive acknowledges that the ultimate authority
to determine who will serve as an executive officer of
Company and what roles those executives should play is
reserved to the Board, acting in accordance with its
fiduciary duties.






	 	(3)	 	For purposes of this Agreement, “Severance Package” shall
mean:






	 	(A)	 	Base Salary continuation for eighteen
(18) months following the date of termination at
Executive’s annual Base Salary rate in effect on the
date of termination, subject to all applicable federal,
state and local withholding and reporting requirements.
These salary continuation payments shall be paid in
accordance with usual Company payroll practices;






	 	(B)	 	A bonus equal to one hundred fifty
percent (150%) of Executive’s Target Bonus in effect on
the date of termination under EECP, payable in equal
installments over the eighteen (18) month period
described in Section 6(a)(3)(A) above, subject to the
same withholding and reporting requirements. In
addition, to the extent not included in the Accrued
Amounts, Executive shall receive a pro rata bonus for
the bonus period during which the date of termination
occurs calculated at one hundred percent (100%) of the
Target Bonus, multiplied by a fraction the numerator of
which is the number of days that Executive was employed
during such bonus term and the denominator of which is
365. Such prorated bonus shall be paid in accordance
with customary practices for payment of bonuses under
EECP;






	 	(C)	 	Twelve (12) months of continued
vesting under all Restricted Stock Awards and Option
Awards (i.e., vesting calculated at the time of
employment termination as if termination were to occur
twelve months later). For purposes of avoiding
confusion, the parties acknowledge that (i) the
Restricted Stock Agreement and the Amended and Restated
Restricted Stock Agreement, both dated as of July 15,
2002, between Company and Executive (together the “2002




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	 	 	 	Restricted Stock Agreements”) contain language intended
to effectuate this continued vesting, which is located
in the proviso to the definition of “Measurement Date”
in Section 2.1(a) thereof, (ii) the inclusion of such
language in the 2002 Restricted Stock Agreements is not
intended to create additional vesting beyond the twelve
months described in the first sentence of this
paragraph (C), and (iii) in light of the first sentence
of this paragraph (C), the 2002 Restricted Stock
Agreements should be read as if such proviso were
deleted.






	 	(D)	 	Continuation of benefits under any
life, group health, and dental insurance benefits
substantially similar to those which Executive was
receiving immediately prior to termination of employment
until the earlier of:






	 	(i)	 	the end of the eighteen
(18) month period following the date of
termination, or






	 	(ii)	 	the date on which
Executive becomes eligible to receive any benefits
under any plan or program of any other employer.






	 	 	 	The continuing coverage provided under this Section
6(a)(3)(D) is subject to the availability of such
continuation under the terms of the applicable plan
documents and all provisions of applicable law. If
Executive is not eligible for such continued coverage
under one of the Company-provided benefit plans noted
in this paragraph (D) that he was participating in
during his employment, Company shall pay Executive the
cash equivalent of the cost of replacement insurance
for the duration of the applicable period.






	 	(b)	 	Voluntary Termination by Executive Without Good Reason. If
Executive terminates his employment with Company without Good
Reason, then Company shall pay Executive the Accrued Amounts in a
lump sum within ten (10) days of termination of employment.






	 	(c)	 	Termination for Cause. If Executive’s employment is
terminated for Cause, Company shall pay Executive the Accrued
Amounts in a lump sum within ten (10) days of termination of
employment. As used herein, the term “Cause” shall be limited to:






	 	(1)	 	Executive’s conviction of or plea of guilty or
nolo contendere to a crime constituting a felony under the
laws of the United States or any state thereof or any other
jurisdiction in which Company conducts business;




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	 	(2)	 	Executive’s willful misconduct or gross
negligence in the performance of his duties that causes
material harm to Company;






	 	(3)	 	Executive’s willful and continued failure to
follow the reasonable instructions of Company’s Board;






	 	(4)	 	Executive’s willful and continued neglect of
duties (other than any such neglect resulting from incapacity
of Executive due to physical or mental illness); or






	 	(5)	 	a material breach of this Agreement by Executive;






	 	 	 	provided, however, that Cause shall arise under items (2), (3), (4)
or (5) only following thirty (30) days written notice thereof from
Company which specifically identifies such misconduct, failure,
neglect or breach and the continuance of such misconduct, failure,
neglect or breach during such notice period, and further provided
that Cause under items (3), (4) and (5) shall be subject to the
last sentence of Section 8(c) hereof. During any such notice
period, Executive shall have the right to be heard before the full
Board and Cause shall not be deemed to exist without a finding by
the Board that Cause has not been cured and continues to exist
after the thirty (30) day cure period. A failure of Company to
notify Executive after the first occurrence of an event
constituting Cause shall not preclude any subsequent occurrences of
such event (or similar event) from constituting Cause.






	 	(d)	 	Certain Terminations Following a Change of Control. In the
event Executive’s employment with Company terminates by reason of a
Qualifying Termination (as defined below) within two (2) years after
a Change of Control of Company (as defined below) that occurs during
the Term of Employment, then Company shall pay to Executive (x) the
Accrued Amounts in a lump sum within ten (10) days of termination of
employment and (y), in lieu of the Severance Package, and subject to
the limitations described in Section 7 below and subject to the
following two sentences, Company shall provide Executive the Change
of Control Benefits (as defined below). The provision of the Change
of Control Benefits to Executive under this Section 6(d) shall (i)
be contingent upon the execution by Executive of Company’s standard
release agreement then in effect or a release in another form
reasonably acceptable to Company and (ii) constitute the sole remedy
of Executive in the event of a termination of Executive’s employment
in the circumstances set forth in this Section 6(d). In addition,
all payments under this Section 6(d) are subject to the timing
rules, calculations and adjustments described in Section 7.






	 	(1)	 	“Change of Control Benefits” shall mean:




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	 	(A)	 	Base Salary continuation for twenty
four (24) months following the date of termination at
Executive’s annual Base Salary rate in effect on the
date of termination, subject to all applicable federal,
state and local withholding and reporting requirements.
These salary continuation payments shall be paid in
accordance with usual Company payroll practices;






	 	(B)	 	A bonus equal to two hundred percent
(200%) of Executive’s Target Bonus in effect on the date
of termination under EECP, payable in equal installments
over the twenty four (24) month period described in
Section 6(d)(1)(A) above, subject to the same
withholding and reporting requirements. In addition, to
the extent not included in the Accrued Amounts,
Executive shall receive a pro rata bonus for the bonus
period during which the date of termination occurs
calculated at one hundred percent (100%) of the Target
Bonus, multiplied by a fraction the numerator of which
is the number of days that Executive was employed during
such bonus term and the denominator of which is 365.
Such prorated bonus shall be paid in accordance with
customary practices for payment of bonuses under EECP;






	 	(C)	 	Acceleration in full of the vesting of all Restricted
Stock Awards and Option Awards; and






	 	(D)	 	Continuation of life, group health
and dental insurance benefits substantially similar to
those which Executive was receiving immediately prior to
the Qualifying Termination until the earlier of:






	 	(i)	 	the end of the twenty
four (24) month period following Executive’s
termination of employment, or






	 	(ii)	 	the date on which
Executive becomes eligible to receive any benefits
under any plan or program of any other employer.






	 	 	 	The continuing coverage provided under this Section
6(d)(1)(D) is subject to the availability of such
continuation under the terms of the applicable plan
documents and all provisions of applicable law. If
Executive is not eligible for such continued coverage
under one of the Company-provided benefit plans noted
in this paragraph (D) that he was participating in
during his employment, Company shall pay Executive the
cash equivalent of the cost of replacement insurance
for the duration of the applicable period.




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	 	(2)	 	Qualifying Termination. For purposes of this
Agreement, the term “Qualifying Termination” means a
termination of Executive’s employment with Company for any
reason other than:






	 	(A)	 	death;






	 	(B)	 	Disability, as defined herein;






	 	(C)	 	Cause, as defined herein; or






	 	(D)	 	A termination by Executive without Good Reason, as
defined herein.






	 	(3)	 	Change of Control Defined. For purposes of this
Agreement, a “Change of Control” shall have the meaning set
forth in Exhibit A attached hereto.






	 	(e)	 	Disability. In the event that Executive suffers a Disability,
Company may, in its discretion, terminate Executive’s employment
hereunder. For purposes of this Agreement, “Disability” shall be
defined to occur at such time as Executive becomes eligible to receive
benefits under the terms of Company’s then applicable long-term
disability policy, or, in the absence of such policy, shall be defined
as a physical or mental disability that prevents Executive from
performing his duties under this Agreement which continues for ninety
(90) consecutive days or more, or for an aggregate of ninety (90) days
in any period of twelve (12) months. Company may only terminate
Executive on account of Disability after giving due consideration to
whether reasonable accommodations can be made under which Executive is
able to fulfill his duties under this Agreement. The commencement date
and expected duration of any physical or mental condition that prevents
Executive from performing his duties hereunder shall be determined by a
medical doctor mutually acceptable to Executive and Company. In the
event Executive’s employment is terminated by Company pursuant to this
Section 6(e), then Company shall pay Executive the Accrued Amounts in a
lump sum within ten (10) days of termination of employment. In
addition, to the extent not included in the Accrued Amounts, Executive
shall receive a pro rata bonus for the bonus period during which the
date of termination pursuant to this Section 6(e) occurs calculated at
one hundred percent (100%) of the Target Bonus, multiplied by a
fraction the numerator of which is the number of days that Executive
was employed during such bonus term and the denominator of which is
365. Such prorated bonus shall be paid in accordance with customary
practices for payment of bonuses under EECP






	 	(f)	 	Death. In the event of Executive’s death during the Term of
Employment, all obligations of Company to make any further payments,
including the obligation to pay the Accrued




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	 	 	 	Amounts, shall be paid to Executive’s estate, and in any event all
Accrued Amounts shall be paid in a lump sum within ten (10) days of
Executive’s death. In addition, to the extent not included in the
Accrued Amounts, Executive’s estate shall receive a payment or
payments reflecting a pro rata bonus for Executive for the bonus
period during which the date of termination pursuant to this Section
6(f) occurs calculated at one hundred percent (100%) of the Target
Bonus, multiplied by a fraction the numerator of which is the number
of days that Executive was employed during such bonus term and the
denominator of which is 365. Such prorated bonus shall be paid in
accordance with customary practices for payment of bonuses under EECP






	 	(g)	 	Payments as Compensable Compensation. Any participation by
Executive in, and any terminating distributions and vested rights
under, Company-sponsored retirement or deferred compensation plans,
regardless of whether such plans are qualified or nonqualified for tax
purposes, shall be governed by the terms of those respective plans.






	 	(h)	 	Executive’s Duty to Provide Materials. Upon the termination of the
Term of Employment for any reason, Executive or his estate shall
surrender to Company all correspondence, letters, files, contracts,
mailing lists, customer lists, advertising material, ledgers, supplies,
equipment, checks, and all other materials and records of any kind that
are the property of Company or any of its subsidiaries or affiliates,
that may be in Executive’s possession or under his control, including
all copies of any of the foregoing.





     Section 7
- Cap on Payments.




	 	(a)	 	Notwithstanding any other provision of this Agreement, except as
set forth in Section 7(b), in the event that Company undergoes a
“Change in Ownership or Control” (as defined below), Company shall not
be obligated to provide to Executive a portion of any “Contingent
Compensation Payments” (as defined below) that Executive would
otherwise be entitled to receive to the extent necessary to eliminate
any “excess parachute payments” (as defined in Section 280G(b)(1) of
the Internal Revenue Code of 1986, as amended (the “Code”)) for
Executive. For purposes of this Section 7, the Contingent Compensation
Payments so eliminated shall be referred to as the “Eliminated
Payments” and the aggregate amount (determined in accordance with
Proposed Treasury Regulation Section 1.280G-1, Q/A-30 or any successor
provision) of the Contingent Compensation Payments so eliminated shall
be referred to as the “Eliminated Amount.”






	 	(b)	 	Notwithstanding the provisions of Section 7(a), no such reduction
in Contingent Compensation Payments shall be made if (i) the Eliminated
Amount (computed without regard to this sentence) exceeds (ii) 110% of
the aggregate present value (determined in accordance with Proposed
Treasury Regulation Section 1.280G-1, Q/A-31 and Q/A-32 or any
successor provisions) of the amount of any additional taxes that would
be incurred by Executive if the Eliminated Payments (determined without
regard to this sentence) were paid to him (including, state and federal
income taxes on the Eliminated Payments, the




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	 	 	 	excise tax imposed by Section 4999 of the Code payable with respect to
all of the Contingent Compensation Payments in excess of Executive’s
“base amount” (as defined in Section 280G(b)(3) of the Code), and any
withholding taxes). The override of such reduction in Contingent
Compensation Payments pursuant to this Section 7(b) shall be referred
to as a “Section 7(b) Override.” For purpose of this paragraph, if
any federal or state income taxes would be attributable to the receipt
of any Eliminated Payment, the amount of such taxes shall be computed
by multiplying the amount of the Eliminated Payment by the maximum
combined federal and state income tax rate provided by law.






	 	(c)	 	For purposes of this Section 7, the following terms shall have the
following respective meanings:






               (i)
“Change in Ownership or Control” shall mean a
change in the ownership or effective control of Company or in
the ownership of a substantial portion of the assets of
Company determined in accordance with Section 280G(b)(2) of
the Code.




               (ii)
“Contingent Compensation Payment” shall mean any
payment (or benefit) in the nature of compensation that is
made or made available (under this Agreement or otherwise) to
a “disqualified individual” (as defined in Section 280G(c) of
the Code) and that is contingent (within the meaning of
Section 280G(b)(2)(A)(i) of the Code) on a Change in
Ownership or Control of Company.




	 	(d)	 	Any payments or other benefits otherwise due to Executive following
a Change in Ownership or Control that could reasonably be characterized
(as determined by Company) as Contingent Compensation Payments (the
“Potential Payments”) shall not be made until the dates provided for in
this Section 7(d). Within 30 days after each date on which Executive
first becomes entitled to receive (whether or not then due) a
Contingent Compensation Payment relating to such Change in Ownership or
Control, Company shall determine and notify Executive (with reasonable
detail regarding the basis for its determinations) (i) which Potential
Payments constitute Contingent Compensation Payments, (ii) the
Eliminated Amount and (iii) whether the Section 7(b) Override is
applicable. Within 30 days after delivery of such notice to Executive,
Executive shall deliver a response to Company (the “Executive
Response”) stating either (A) that he agrees with Company’s
determination pursuant to the preceding sentence, in which case he
shall indicate, if applicable, which Contingent Compensation Payments,
or portions thereof (the aggregate amount of which, determined in
accordance with Proposed Treasury Regulation Section 1.280G-1, Q/A-30
or any successor provision, shall be equal to the Eliminated Amount),
shall be treated as Eliminated Payments or (B) that he disagrees with
such determination, in which case he shall set forth (i) which
Potential Payments should be characterized as Contingent Compensation
Payments, (ii)




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	 	 	 	the Eliminated Amount, (iii) whether the Section 7(b) Override is
applicable, and (iv) which (if any) Contingent Compensation Payments,
or portions thereof (the aggregate amount of which, determined in
accordance with Proposed Treasury Regulation Section 1.280G-1, Q/A-30
or any successor provision, shall be equal to the Eliminated Amount,
if any), shall be treated as Eliminated Payments. In the event that
Executive fails to deliver an Executive Response on or before the
required date, Company’s initial determination shall be final and the
Contingent Compensation Payments that shall be treated as Eliminated
Payments shall be determined by Company in its absolute discretion.
If Executive states in the Executive Response that he agrees with
Company’s determination, Company shall make the Potential Payments to
Executive within three business days following delivery to Company of
the Executive Response (except for any Potential Payments which are
not due to be made until after such date, which Potential Payments
shall be made on the date on which they are due). If Executive states
in the Executive Response that he disagrees with Company’s
determination, then, for a period of 60 days following delivery of the
Executive Response, Executive and Company shall use good faith efforts
to resolve such dispute. If such dispute is not resolved within such
60-day period, such dispute shall be settled exclusively by
arbitration in Boca Raton, Florida, in accordance with the rules of
the American Arbitration Association then in effect. Judgment may be
entered on the arbitrator’s award in any court having jurisdiction.
Company shall, within three business days following delivery to
Company of the Executive Response, make to Executive those Potential
Payments as to which there is no dispute between Company and Executive
regarding whether they should be made (except for any such Potential
Payments which are not due to be made until after such date, which
Potential Payments shall be made on the date on which they are due).
The balance of the Potential Payments shall be made within three
business days following the resolution of such dispute. Subject to
the limitations contained in Sections 7(a) and (b) hereof, the amount
of any payments to be made to Executive following the resolution of
such dispute shall be increased by amount of the accrued interest
thereon computed at the prime rate announced from time to time by
Citibank, compounded monthly from the date that such payments
originally were due.






	 	(e)	 	Upon the written request of Executive (which request must specify
Executive’s actual tax circumstances) delivered to Company within 90
days following the timely filing of all relevant tax returns for the
Executive for the year or other taxable period in which the Eliminated
Payments would have been made, the Eliminated Payments shall be
recomputed based upon the Executive’s actual tax circumstances and the
reference to “110%” in clause (ii) of Section 7(b) shall be deemed to
be “100%”. If, as a result of such recomputation, there are no
Eliminated Payments, the Executive shall become entitled to receive
Contingent Compensation Payments previously treated as Eliminated
Payments within 10 days of the delivery of the aforementioned request.




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	 	(f)	 	The provisions of this Section 7 are intended to apply to any and
all payments or benefits available to Executive under this Agreement or
any other agreement or plan of Company under which Executive receives
Contingent Compensation Payments.





     Section 8
- Other Agreements.




	 	(a)	 	Non-Solicitation; Non-Disclosure, etc. On this date, and in
consideration for the provisions of this Agreement, among other things,
Executive has separately executed a Non-Competition and
Non-Solicitation Agreement (the “Standard Agreement”). Executive
hereby reaffirms his agreement to the terms and conditions set forth in
the Standard Agreement.






	 	(b)	 	Offer Letter. The Offer Letter is hereby superseded in its
entirety and shall have no further force or effect.






	 	(c)	 	No Violation of Other Agreements. Executive 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 Company or to refrain from competing, directly or
indirectly, with the business of such previous employer or any other
party, except for any such agreement that have been disclosed to the
Company and that could not reasonably be expected to compromise
Executive’s ability to perform his duties as Chief Executive Officer of
Company. Executive further represents that, to his knowledge and
belief, he has not breached any agreement not to compete or any
agreement to keep in confidence proprietary information, knowledge or
data acquired by him in confidence or in trust prior to his employment
with Company, and Executive acknowledges Company’s desire and direction
that he not breach any such agreement in the performance of his
services hereunder. Accordingly, Company agrees that any failure or
refusal of Executive to perform his duties as Chief Executive Officer
of Company shall not constitute “Cause” to the extent such failure or
refusal is attributable to Executive’s compliance with such agreements.




13









 











     Section 9
- Notices. All notices or communications hereunder shall be in
writing, addressed as follows:



	 	 	 	 	 
	

	 	To Company:
	 	Eclipsys Corporation

1750 Clint Moore Road

Boca Raton, FL 33487

ATTN: Chairman of the Board
	 
	 	 	 	 
	

	 	with a copy to:
	 	Brent B. Siler

Hale and Dorr LLP

11951 Freedom Drive

Suite 1400

Reston, Virginia 20190
	 
	 	 	 	 
	

	 	To Executive:
	 	Paul L. Ruflin

5601 Rico Drive

Boca Raton, FL 33489
	 
	 	 	 	 
	

	 	with a copy to:
	 	Michael G. Riley, Esq.

McDonald Hopkins Co., L.P.A.

600 Superior Avenue, Suite 2100

Cleveland, OH 44114







Any such notice or communication shall be delivered by hand or sent certified
or registered mail, return receipt requested, postage prepaid, or by reputable
overnight courier addressed as above (or to such other address as such party
may designate in a notice duly delivered as described above), and the time of
actual delivery, if delivered by hand, the next business day, if sent by
overnight courier, or the third (3rd) business day after the actual date of
mailing, if sent by mail, shall constitute the time at which notice was given.




     Section 10
- Separability. If any provision of this Agreement shall be
declared to be invalid or unenforceable, in whole or in part, such invalidity
or unenforceability shall not affect the remaining provisions hereof which
shall remain in full force and effect.



     Section 11
- Assignment and Assumption. This contract shall be binding
upon and inure to the benefit of the heirs and representatives of Executive and
the assigns and successors of Company, but neither this Agreement nor any
rights or obligations hereunder shall be assignable or otherwise subject to
hypothecation by Executive (except by will or by operation of the laws of
interstate succession) or by Company, except that Company may assign this
Agreement to any successor (whether by merger, purchase or otherwise) to all or
substantially all of the stock, assets or business of Company.



14









 





     Section 12
- Amendment. This Agreement may only be amended by written
agreement of the parties hereto.



     Section 13
- Survivorship. The respective rights and obligations of the
parties hereunder shall survive any termination of this Agreement to the extent
necessary to the intended preservation of such rights and obligations. The
provisions of this Section 13 are in addition to the survivorship provisions of
any other section of this Agreement.



     Section 14
- Governing Law; Venue and Jurisdiction. This Agreement shall
be governed by and construed under and in accordance with the laws of the State
of Florida (without reference to the conflicts of law provisions thereof). If
any judicial or administrative proceeding or claim relating to or pertaining to
this Agreement is initiated by either party hereto, such proceeding or claim
shall and must be filed in a state or federal court located in Palm Beach
County, Florida, and Company and Executive each consents to the jurisdiction of
such a court..



     Section 15
- Prior Agreement; Coordination of Benefits. This Agreement,
along with the Standard Agreement, contains the entire understanding between
the parties hereto regarding terms of Executive’s employment and supersedes in
all respects any prior or other employment agreement or understanding, both
written and oral. In the event of a conflict between this Agreement and any
policy or plan that applies generally to employees of Company regarding
performance bonuses, healthcare, retirement, severance, change of control,
relocation, or equity programs such as Restricted stock or Option awards, this
Agreement shall control unless the generally applicable plan or program would
provide a greater benefit or award to Executive, in which case the terms of
such plan or program shall control over this Agreement.



     Section 16
- Withholding. Company shall be entitled to withhold from
payment any amount of withholding required by law.



     Section 17
- Section Headings and Construction. The headings of sections
in this Agreement are provided for convenience only and will not effect its
construction or interpretation. All references to “Section” or “Sections”
refer to the corresponding section or sections of this Agreement unless
otherwise specified. All words used in this Agreement will be construed to be
of such gender or number as circumstances require.



     Section 18
- Counterparts. This Agreement may be executed in one (1) or
more counterparts, each of which will be deemed to be an original copy of this
Agreement and all of which, when taken together, will be deemed to constitute
one and the same Agreement.



     Section 19
- Acknowledgement. Executive states and represents that he has
had an opportunity to fully discuss and review the terms of this Agreement with
an attorney. Executive further states and represents that he has carefully
read this Agreement, understands the contents



15









 





herein, freely and voluntarily assents to all of the terms and conditions
hereof, and signs his name of his own free act.




     Intending to be legally bound hereby, the parties have executed this
Agreement on the date set forth above.



	 	 	 	 	 
	 	 	
COMPANY
	 
	 	 	 	 
	 	 	ECLIPSYS CORPORATION
	 	 	 
	

	 	By:
	 	     /s/ Eugene V. Fife
	

	 	 	 	

	

	 	 	 	     Eugene V. Fife, Chairman of the Board
	 
	 	 	 	 
	 	 	
EXECUTIVE
	 
	 	 	 	 
	

	 	 	 	     /s/ Paul L. Ruflin
	 	 	

	 	 	Paul L. Ruflin







16









 






EXHIBIT A




     “Change in Control” means an event or occurrence set forth in any one or
more of subsections (a) through (d) below (including an event or occurrence
that constitutes a Change in Control under one of such subsections but is
specifically exempted from another such subsection) that occurs during the Term
of Employment:



          (a) the acquisition by an individual, entity or group (within the meaning
of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”)) (a “Person”) of beneficial ownership of any
capital stock of the Company if, after such acquisition, such Person
beneficially owns (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) 30% or more of either (x) the then-outstanding shares of common
stock of the Company (the “Outstanding Company Common Stock”) or (y) the
combined voting power of the then-outstanding securities of the Company
entitled to vote generally in the election of directors (the “Outstanding
Company Voting Securities”); provided, however, that for purposes of this
subsection (a), the following acquisitions shall not constitute a Change in
Control: (i) any acquisition directly from the Company (excluding an
acquisition pursuant to the exercise, conversion or exchange of any security
exercisable for, convertible into or exchangeable for common stock or voting
securities of the Company, unless the Person exercising, converting or
exchanging such security acquired such security directly from the Company or an
underwriter or agent of the Company), (ii) any acquisition by the Company,
(iii) any acquisition by any employee benefit plan (or related trust) sponsored
or maintained by the Company or any corporation controlled by the Company, (iv)
any acquisition by any corporation pursuant to a transaction which complies
with clauses (i) and (ii) of subsection (c) below; or (v) any acquisition by
General Atlantic Partners 28, L.P., General Atlantic Partners 38, L.P., General
Atlantic Partners 47, L.P., GAP Coinvestment Partners, L.P., General Atlantic
Partners, LLC, and any person directly or indirectly controlled (within the
meaning of Rule 12b-2 promulgated under the Exchange Act) by any of the
foregoing entities described in this clause (v) (each such party is referred to
herein as an “Exempt Person”) of any shares of Common Stock; or



          (b) such time as the Continuing Directors (as defined below) do not
constitute a majority of the Board (or, if applicable, the Board of Directors
of a successor corporation to the Company), where the term “Continuing
Director” means at any date a member of the Board (i) who was a member of the
Board on the date of the execution of this Agreement or (ii) who was nominated
or elected subsequent to such date by at least a majority of the directors who
were Continuing Directors at the time of such nomination or election or whose
election to the Board was recommended or endorsed by at least a majority of the
directors who were Continuing Directors at the time of such nomination or
election; provided, however, that there shall be excluded from this clause (ii)
any individual whose initial assumption of office occurred as a result of an
actual or



17









 





threatened election contest with respect to the election or removal of
directors or other actual or threatened solicitation of proxies or consents, by
or on behalf of a person other than the Board; or




          (c) the consummation of a merger, consolidation, reorganization,
recapitalization or statutory share exchange involving the Company or a sale or
other disposition of all or substantially all of the assets of the Company in
one or a series of transactions (a “Business Combination”), unless, immediately
following such Business Combination, each of the following two conditions is
satisfied: (i) all or substantially all of the individuals and entities who
were the beneficial owners of the Outstanding Company Common Stock and
Outstanding Company Voting Securities immediately prior to such Business
Combination beneficially own, directly or indirectly, more than 50% of the
then-outstanding shares of common stock and the combined voting power of the
then-outstanding securities entitled to vote generally in the election of
directors, respectively, of the resulting or acquiring corporation in such
Business Combination (which shall include, without limitation, a corporation
which as a result of such transaction owns the Company or substantially all of
the Company’s assets either directly or through one or more subsidiaries) (such
resulting or acquiring corporation is referred to herein as the “Acquiring
Corporation”) in substantially the same proportions as their ownership,
immediately prior to such Business Combination, of the Outstanding Company
Common Stock and Outstanding Company Voting Securities, respectively; and (ii)
no Person (excluding the Acquiring Corporation, any employee benefit plan (or
related trust) maintained or sponsored by the Company or by the Acquiring
Corporation, or any Exempt Person) beneficially owns, directly or indirectly,
30% or more of the then outstanding shares of common stock of the Acquiring
Corporation, or of the combined voting power of the then-outstanding securities
of such corporation entitled to vote generally in the election of directors
(except to the extent that such ownership existed prior to the Business
Combination); or



          (d) approval by the stockholders of the Company of a complete liquidation
or dissolution of the Company.




18