**Exhibit10.1**

 

**EXETechnologies, Inc.**

 

EMPLOYMENTAGREEMENT

 

 

THIS EMPLOYMENTAGREEMENT (the “Agreement”) is made as of the 13th day of May 2002by and between Kenneth R. Vines, a resident of Texas (the “Employee”), and EXETechnologies, Inc., a corporation organized and existing under the laws of theState of Delaware (the “Company”) with its headquarters in Dallas, Texas.

 

WHEREAS, theCompany is engaged in the business of providing software for warehousemanagement, supply chain execution, order fulfillment and inventory planningand related services for warehouse, distribution and logistics facilitiesworldwide (the “Business”),

 

WHEREAS, theCompany hired the Employee on May 13, 2002 (the “Start Date”) pursuant to aSummary of Terms dated April 26, 2002 (the “Term Sheet”);

 

WHEREAS, the TermSheet contemplated that it would be superceded by a definitive employmentagreement;

 

WHEREAS, theCompany desires to employ the Employee and the Employee desires to be employedby the Company for a period of time commencing on the Start Date and continuinginto the future upon the terms and conditions hereinafter set forth.

 

NOW, THEREFORE, inconsideration of the mutual covenants and obligations contained herein, andintending to be legally bound, the parties, subject to the terms and conditionsset forth herein, agree as follows:

 

1.             Employment and Term.  The Company hereby employs the Employee andthe Employee hereby accepts employment with the Company for the positiondetailed in Schedule A hereto, for a period of one (1) year from the Start Date(the “Initial Term”).  At the end of theInitial Term, this Agreement shall automatically renew for successiveadditional periods of one (1) year, unless terminated by either party upon noless than ninety (90) days prior written notice to the other party prior to theexpiration of the Initial Term or any such renewal period.   The Initial Term of employment and anyrenewal periods hereunder, subject to the provisions of Section 8 hereof, arehereinafter referred to as the “Term.”

 

2.             Duties.  During the Term, the Employee shall servethe Company faithfully and to the best of the Employee’s ability devote hisfull time, attention, skill and efforts to the performance of the dutiesrequired by or appropriate for the Position.  The Employee shall report to the Chief Executive Officer (the “Reporting Manager”).  The Employee shall assume such duties andresponsi­bilities as may be customarily incident to such a position, and suchadditional and other duties as may be assigned to the Employee from time totime by the Reporting Manager or the Board of Directors of the Company (the“Board”), including, without limitation, the duties and responsibilities setforth in Schedule B attached hereto,provided that such duties, functions, responsibilities, and authority arereasonable and customary for a person serving as Senior Vice President andChief Financial Officer of an enterprise comparable to the Company.

 

3.             Other Business Activities.  During the Term, the Employee shall not,without the prior written consent of the Company in its sole discretion,directly or indirectly engage in any other business activities or pursuitswhatsoever, except: activities in connection with charitable or civicactivities; personal investments; serving as an executor, trustee or in othersimilar fiduciary capacity; provided that such activities do not interfere inany material respect with the Employee’s performance of the Employee’sresponsibilities and obligations pursuant to this Agreement; and providedfurther that the Employee complies with all applicable policies and proceduresof the Company.  Notwithstanding theforegoing, the Employee shall be permitted to remain an officer and a directorof Triton Network Systems, Inc. (“Triton”) until such time as Triton is able tofully complete its previously announced liquidation program, provided that suchactivities do not interfere in any material respect with the Employee’sperformance of the Employee’s responsibilities and obligations pursuant to thisAgreement.

 

4.             Compensation.  The Company shall pay the Employee, and theEmployee hereby agrees to accept, as compensation for all services renderedhereunder and for the Employee’s intellectual property 

 

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covenants andassignments and covenant not to compete as provided for in Sections 6 and 7hereof, the compensation set forth in this Section 4.

 

4.1           Salary.  The Company shall pay the Employee aninitial base salary at the annual rate detailed in Schedule A attached hereto(the “Base Salary”). The Base Salary shall be inclusive of all applicableincome, social security and other taxes and charges that are required by law tobe withheld by the Company or are requested to be withheld by the Employee.  Such amounts shall be withheld and paid inaccordance with the Company’s normal payroll practice for its similarlysituated employees from time to time in effect. The Base Salary may be increased from time to time by theCompensation Committee of the Board in its discretion, provided, however, that at no time will the Employee’s salary be lessthan the initial Base Salary.

 

4.2           Bonus Program.  With respect to each calendar year, theCompany will pay a bonus to the Employee, in cash and/or stock options inaccordance with the Company’s usual practices and in the discretion of theReporting Manager, based upon the achievement of criteria to be determined asmutually agreed upon in writing by the Employee and the Reporting Manager.  The Employee’s annualized bonus target willbe fifty per cent (50%) of the BaseSalary.  The Employee’s actualbonus payments will vary depending on Company performance and will be payablein accordance with the Company’s usual practices and in the discretion of theReporting Manager.

 

4.3           Equity Participation.  The Company shall grant to the Employee astock option (the “Option”) to purchase shares of common stock of the Company(“Common Stock”), the exercise price, par value and other details of which aredetailed in Schedule A attached hereto. The Option shall be subject to and inaccordance with the provisions of the 1997 Stock Option Plan of the Company, asamended (the “Plan”), substantially in the form of Schedule C.

 

4.4            Fringe Benefits.  TheEmployee shall be entitled to participate in any health or dental programs orother non-salary consideration (such as disability, vacation, sick leave) asare Company standard, or as otherwise described in Schedule E attached heretoand as such standards may be changed from time to time.

 

4.5            Reimbursement of Expenses. The Employee shall be reimbursed for all normal items of travel andentertainment and miscellaneous expenses reasonably incurred by the Employee onbehalf of the Company, provided that such expenses are documented and submittedto the Company all in accordance with the reimbursement policies of the Companyas in effect from time to time.

 

4.6             Indemnification.  The Employee, in any capacity on behalf ofthe Company or any of its subsidiaries or affiliates, shall be entitled to exculpation,indemnification, and advancement of expenses to the fullest extent notprohibited by Delaware or other applicable law, all as more fully described byan Indemnification Agreement to be entered into between the Employee and theCompany substantially in the form used by the Company with its executiveofficers. The Employee shall also beentitled to coverage under each directors’ and officers’ liability insurancepolicy, if any, maintained by or on behalf of the Company’s directors andofficers.

 

4.7             Attorneys’ Feesto Negotiate Agreement. The Company shall pay, or reimburse Employee for,the reasonable attorneys’ fees and expenses incurred in connection with theEmployee’s negotiation of this Agreement within thirty (30) days afterpresentation of each invoice from the Employee’s attorneys; provided that suchfees shall be limited to $3,000.

 

5.             Confidentiality.  The Employee recognizes and acknowledgesthat the Proprietary Information (as hereinafter defined) is a valuable,special and unique asset of the Company. As a result, both during the Term and for a period of five (5) yearsthereafter, the Employee shall not, without the prior written consent of theCompany, for any reason either directly or indirectly divulge to anythird-party or use for the Employee’s own benefit, or for any purpose otherthan the exclusive benefit of the Company, any confidential, proprietary,business and technical information or trade secrets of the Company or of anysubsidiary or affiliate of the Company (the “Proprietary Information”)revealed, obtained or developed in the course of the Employee’s employment withthe Company.  Proprietary Informationshall include, but shall not be limited to: the intangible personal propertydescribed in Section 6(b) hereof; any information relating to methods ofproduction, manufacture and research; hardware and software configurations,computer codes or instructions (including source and object 

 

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code listings,program logic algorithms, subroutines, modules or other subparts of computerprograms and related documentation, including program notation), computerinputs and outputs (regardless of the media on which stored or located) andcomputer processing systems, techniques, designs, architecture, and interfaces;the identities of, the Company’s relationship with, the terms of contracts andagreements with, the needs and requirements of, and the Company’s course ofdealing with, the Company’s actual and prospective customers, contractors andsuppliers; and any other materials prepared by the Employee in the course ofthe Employee’s employment by the Company, or prepared by any other employee orcontractor of the Company for the Company or its customers (including concepts,layouts, flow charts, specifications, know-how, user or service manuals, plans,sketches, blueprints, costs, business studies, business procedures, finances,marketing data, methods, plans, personnel information, customer and vendorcredit information and any other materials that have not been made available tothe general public).  Nothing containedherein shall restrict the Employee’s ability to make such disclosures duringthe course of the Employee’s employment as may be necessary or appropriate tothe effective and efficient discharge of the duties required by or appropriatefor the Position or as such disclosures may be required by law.  Furthermore, nothing contained herein shallrestrict the Employee from divulging or using for the Employee’s own benefit orfor any other purpose any Proprietary Information that is readily available tothe general public so long as such information did not become available to thegeneral public as a direct or indirect result of the Employee’s breach of thisSection 5.  Failure by the Companyto mark any of the Proprietary Information as confidential or proprietary shallnot affect its status as Proprietary Information under the terms of thisAgreement.

 

6.             Property.

 

(a)           All right, title and interest in andto Proprietary Information shall be and remain the sole and exclusive propertyof the Company.  During the Term, theEmployee shall not remove from the Company’s offices or premises any documents,records, notebooks, drawings, sketches, program listings, files,correspondence, reports, memoranda or similar materials of or containingProprietary Information, or other materials or property of any kind belongingto the Company unless necessary or appropriate in accordance with the dutiesand responsibilities required by or appropriate for the Position and, in theevent that such materials or property are removed, all of the foregoing shallbe returned to their proper files or places of safekeeping as promptly aspossible after the removal shall serve its specific purpose.  The Employee shall not make, retain, removeand/or distribute any copies of any of the foregoing for any reason whatsoever,except as may be necessary in the discharge of the assigned duties, and shallnot divulge to any third person the nature of and/or contents of any of theforegoing or of any other oral or written information to which the Employee mayhave access or with which for any reason the Employee may become familiar,except as disclosure shall be necessary in the performance of the duties; andupon the earlier of (i) a request by the Company or (ii) the termination of theEmployee’s employment with the Company, the Employee shall return to theCompany all originals and copies of the foregoing then in the possession,whether prepared by the Employee or by others.

 

(b)           (i)            TheEmployee acknowledges that all right, title and interest in and to any and allwritings, documents, inventions, improvements, discoveries, methods,developments, works of authorship, computer programs or instructions (whetherin source code, object code, or any other form and whether patentable or not),algorithms, formulae, plans, memoranda, tests, research, designs, innovations,systems, analyses, specifications, models, data, diagrams, flow charts, and/ortechniques (whether reduced to written or electronic form or otherwise) thatthe Employee creates, makes, conceives, discovers, develops or reduces topractice, either solely or jointly with any other person, on behalf of theCompany at any time during the Term, whether during working hours or at theCompany’s facility or at any other time or location, and that relate to or areuseful in any way in connection with the Business now or hereafter carried onby the Company (collectively, “Intellectual Work Product”) shall be the soleand exclusive property of the Company. The Employee shall promptly disclose to the Company all IntellectualWork Product, and the Employee shall have no claim for additional compensationfor the Intellectual Work Product.  Inaddition the Employee hereby waives all claims to moral rights in anyIntellectual Work Product.

 

                (ii)           The Employee acknowledges that allthe Intellectual Work Product that is copyrightable shall be considered a workmade for hire under United States Copyright Law.  To the extent that any copyrightable Intellectual Work Productmay not be considered a work made for hire under the applicable provisions ofthe United States Copyright Law, or to the extent that, notwithstanding theforegoing provisions, the Employee may retain an interest in any IntellectualWork Product that is not copyrightable, the Employee hereby irrevocably assignsand transfers to the Company any and all right, title, or interest that theEmployee may have in 

 

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the IntellectualWork Product under copyright, patent, trade secret, trademark and otherintellectual property laws, in perpetuity or for the longest period otherwisepermitted by law, without the necessity of further consideration.  The Company shall be entitled to obtain andhold in its own name all copyrights, patents, trade secrets, and trademarkswith respect thereto.

 

                                                                (iii)          The Employee shall reveal promptly allinformation relating to the Intellectual Work Product to an appropriate officerof the Company, cooperate with the Company and execute such documents as may benecessary or appropriate (A) in the event that the Company desires to seekcopyright, patent, trademark or other analogous protection thereafter relatingto the Intellectual Work Product, and when such protection is obtained, renewand restore the same, or (B) to defend any opposition proceedings in respect ofobtaining and maintaining such copyright, patent, trademark or other analogousprotection.

 

                                                                (iv)          In the event that the Company isunable after reasonable effort to secure the Employee’s signature on any of thedocuments referenced in Section 6(b)(iii) hereof, whether because of theEmployee’s physical or mental incapacity or for any other reason whatsoever,the Employee hereby irrevocably designates and appoints the Company and itsduly authorized officers and agents as the Employee’s agent andattorney-in-fact, to act for and in the Employee’s behalf and stead to executeand file any such documents and to do all other lawfully permitted acts tofurther the prosecution and issuance of any such copyright, patent, trademarkor other analogous protection with the same legal force and effect as ifexecuted by the Employee.

 

                                                                (v)           The Employee represents that theinnovations, designs, systems, analyses, ideas for marketing programs, and allcopyrights, patents, trademarks and trade names, or similar intangible personalproperty identified on Schedule D hereof comprises all of the innovations,designs, systems, analyses, ideas for marketing programs, and all copyrights,patents, trademarks and trade names, or similar intangible personal propertythat the Employee has made or conceived of prior to the date hereof, and sameare excluded from the operation of the other provisions of this Section 6(b).

 

7.             Covenant not to Compete.

 

(a)           In consideration of the compensation,including but not limited to equity participation, and other covenants by theCompany under this Agreement, the Employee shall not, anywhere in the world,during the Term and for a period of one (1) year thereafter (the “RestrictedPeriod”), do any of the following, either alone or in association with others,without the prior written consent of the Company in its sole discretion:

 

(i)            engage or participate, directly orindirectly, in any business whose primary or principal business derives thirtypercent (30%) or more of its gross revenues from providing software forwarehouse management, supply chain execution, order fulfillment and inventoryplanning and related services for warehouse, distribution and logisticsfacilities (a “Competitive Business”), including without limitation thoselisted in Schedule A;

 

(ii)           become interested (as owner,proprietor, promoter, stockholder, lender, partner, co-venturer, director,officer, employee, agent, consultant or otherwise) in any person, firm,corporation, association or other entity (A) that is listed in Schedule A, or(B) is otherwise engaged in any Competitive Business, or become interested in(as owner, stockholder, lender, partner, co-venturer, director, officer,employee, agent, consultant or otherwise) any portion of the business of anyperson, firm, corporation, association or other entity where such portion ofsuch business is considered a Competitive Business (notwithstanding theforegoing, the Employee may hold not more than one percent (1%) of theoutstanding securities of any class of any publicly-traded securities of acompany that is engaged in activities referenced in Section 7(a)(i) hereof);

 

(iii)          solicit or call on for a purposecompetitive with the Business, either directly or indirectly, any (A) customerwith whom the Company shall have dealt at any time during the one (1) yearperiod immediately preceding the termination of the Employee’s employmenthereunder, or (B) supplier or distributor with whom the Company shall havedealt at any time during the one (1) year period immediately preceding thetermination of the Employee’s employment hereunder;

 

(iv)          influence or attempt to influence anysupplier, distributor, customer or

 

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potential customerof the Company to terminate or modify any written or oral agreement or courseof dealing with the Company; or

 

(v)           influence or attempt to influence anyperson either (A) to terminate or modify in any material respect the employment, consulting, agency,distributorship or other arrangement with the Company, or (B) to employ orretain, or arrange to have any other person or entity employ or retain, anyperson who has been employed or retained by the Company as an employee,consultant, agent or distributor of the Company at any time during the one (1)year period immediately preceding the termination of the Employee’s employmenthereunder.

 

(b)           The Employee hereby acknowledges thatthe limitations as to time, character or nature and geographic scope placed onthe Employee’s subsequent employment by this Section 7 are reasonable and fairand will not prevent or materially impair the Employee’s ability to earn alivelihood.

 

8.             Early Termination.  The Employee’s employment hereunder may beterminated during the Term upon the occurrence of any one of the eventsdescribed in this Section 8.  Upontermination, the Employee shall be entitled only to such compensation andbenefits as described in this Section 8.

 

8.1           Termination for Disability.

 

(a)           In the event of the disability of theEmployee such that the Employee is unable to perform the duties andresponsibilities hereunder to the full extent required by this Agreement byreasons of illness, injury or incapacity for a period of more than sixty (60)consecutive days or more than forty-five (45) days, in the aggregate, duringany ninety (90) day period (“Disability”), the Employee’s employment hereundermay be terminated by the Company.

 

(b)           In the event of a termination of theEmployee’s employment hereunder pursuant to Section 8.1(a), the Employee will receive: (i) continuation of the Base Salary in effect as of the date ofsuch termination for a period of six(6) months following the date of termination, payable on the Company’s standardpayroll cycle; (ii) the Employee’s annual bonus based upon the Employee’scurrent annualized target bonus on the date of termination prorated to the dateexpiring six (6) months after the date of termination which shall be paid in alump-sum thirty (30) days following the date of termination; (iii) the right toexercise any stock option held by Employee for the reminder of its term,whether or not exercisable by Employee as of the date of termination; (iv) anyamounts payable pursuant to any plans or policies of the Company; and (v) anyother amounts due but not yet paid from the Company to Employee.

 

 

8.2           Termination by Death. In theevent that the Employee dies during the Term, the Employee’s employment hereundershall be terminated thereby and the Employee’s executors, legal representativesor administrators shall be entitled toreceive from the Company:  (i) theEmployee’s Base Salary in effect as of the date of death for a period of six(6) months following the date of death, which shall be paid in a lump-sumthirty (30) days following the date of death; (ii) the Employee’s annual bonusbased upon the Employee’s current annualized target bonus on the date oftermination prorated to the date expiring six (6) months after the date oftermination which shall be paid in a lump-sum thirty (30) days following thedate of termination; (iii) the right to exercise any stock option held byEmployee on the date of death for the remainder of its term, whether or notexercisable by Employee on the date of death; (iv) any amounts payable on deathpursuant to any plans or policies of the Company; and (v) any other amounts duebut not yet paid from the Company.

 

8.3           Termination for Cause.

 

(a)           The Company may terminate theEmployee’s employment hereunder at any time for “Cause” upon written notice tothe Employee.  For purposes of thisAgreement, “Cause” shall only mean:

 

                (i)          any material breach by the Employee of any of the Employee’s obligations under this Agreementafter Employee has received a written demand for performance from the Companywhich specifically sets forth the factual basis for the Company’s belief thatEmployee breached this 

 

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Agreement and, providedthat a cure is possible, affords Employee a period of ten (10) days to cure;

 

                                                                                (ii)         willful failure or repeated inability by the Employee toperform satisfactorily the duties required by or appropriate for the Position,as determined by the Chief Executive Officer of the Company and the Board ofDirectors of the Company in his and its sole reasonable discretion afterEmployee has received a written demand for performance from the Company whichspecifically sets forth the factual basis for the Company’s belief thatEmployee has not substantially performed his duties and affords Employee aperiod of ten (10) days to cure;

 

                                                                                (iii)        conduct of the Employee involving any(A) type of disloyalty to the Company that has a material detrimental effect onthe Company or, (B ) willful andmaterial misconduct with respect to the Company, including without limitationfraud, embezzlement, theft or proven dishonesty in the course of theemployment, or (C) any attempt by the Employee to secure any personal profitrelated to the Business and the business opportunities of the Company withoutthe informed approval of the Board of Directors;

 

                                                                                (iv)       conviction of a felony or othercriminal act punishable by more than one (1) year in prison;

 

                                                                                (v)        commission by the Employee of anintentional tort or an act involving moral turpitude or constituting fraud; or

 

                                                                                (vi)          habitual alcohol or substance abuse oraddiction.

** **

 

                                                                (b)          In the event of a termination ofthe Employee’s employment hereunder pursuant to Section 8.3(a), the Employeeshall be entitled to receive all accrued but unpaid (as of the effective dateof such termination) Base Salary, benefits and bonuses.  All Base Salary, benefits and bonuses shallcease at the time of such termination, subject to the terms of any benefit orcompensation plan then in force and applicable to the Employee.  All options, including any vested orunvested portion thereof, shall be canceled at the time of such termination,and the Employee shall not be entitled to exercise any unvested options.  Except as specifically set forth in thisSection 8.3, the Company shall have no liability or obligation hereunder byreason of such termination.

 

8.4           Termination Without Cause.

 

                                                                (a)           The Company may terminate theEmployee’s employment hereunder at any time, for any reason, without Cause,effective upon the date designated by the Company upon three (3) months writtennotice to the Employee.

 

                                                                (b)           In the event of a termination of theEmployee’s employment hereunder pursuant to Section 8.4(a), the Employee shallbe entitled to receive (i) all unpaid Base Salary through the date oftermination and all accrued, but unpaid (at the date of termination) benefitsand bonuses; (ii) severance equal to three (3) months Base Salary (at the dateof termination), payable in three (3) equal monthly installments in accordancewith the Company’s payroll practices; (iii) the Employee’s annual bonus basedupon the Employee’s current annualized target bonus on the date of terminationprorated to the date expiring three (3) months after the date of terminationwhich shall be paid in a lump-sum thirty (30) days following the date oftermination; (iv) the immediate vesting of the unvested portion of the Optionthat would have vested if the Employee had continued to be employed by theCompany for a period of three (3) months following his actual termination date;(v) the right to exercise any stock option which is exercisable by Employee onthe date of the termination of his employment; and (vi) any other amounts duebut not yet paid from the Company to Employee. Except as set forth above, all Base Salary, benefits and bonuses shallcease at the time of such termination, subject to the terms of any benefit orcompensation plan then in force and applicable to the Employee.  Except as specifically set forth in thisSection 8.4, the Company shall have no liability or obligation hereunder byreason of such termination.

 

                                                                (c)           In the event of (i) a Change inControl as defined in Section 8.7 below, or (ii) a person other than Ray Hoodis the Company’ s Chief Executive Officer and the Employee is terminated underthis Section 8.4 within twelve (12) months of the date Ray Hood is no longerthe Company’s Chief Executive Officer, then the notice period under Section8.4(a) and the three (3) month time periods referred to in Section 

 

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8.4(a)(ii), (iii) and (iv) shall be changedto three (3) months and nine (9) months, respectively.

 

8.5.      Termination by the Employee forGood Reason.

 

(a)           TheEmployee may terminate the Employee’s employment hereunder at any time for“Good Reason” following a written notice of the termination of employmenthereunder pursuant to this Section 8.5(a), as more fully described below.

 

(b)        Forpurposes of this Agreement, “Good Reason” shall mean:

 

(i)            (1) any reduction by the Company in the Base Salary as ineffect on the date hereof or as the same may be increased from time to time;(2) any reduction in bonus compensation opportunities (which reduction may alsooccur pursuant to any assignment of performance goals and corresponding awardswhich are inconsistent with prior performance goals or awards); (3) the failureby the Company to continue in effect any benefit or compensation plan, lifeinsurance plan, health and accident plan or disability plan in which theEmployee was participating, which would adversely affect the Employee’sparticipation in or materially reduce the Employee’s benefits under any of suchplans, (unless such reduction is pursuant to the general change in benefitsapplicable to all similarly situated employees of the Company); (4) taking ofany action by the Company that would adversely affect the Employee’sparticipation in or materially reduce the Employee’s benefits under any of suchplans (unless such reduction is pursuant to the general change in benefitsapplicable to all similarly situated employees of the Company); (5) deprive theEmployee of any material fringe benefit enjoyed by the Employee;  (6) the failure by the Company to providethe Employee with the number of paid vacation days to which the Employee isentitled; or (7) the transfer of Employee’s principal place of employment to alocation more than 25 miles away from the Company’s current headquarters;

 

(ii)           (1) assignment to Employee of any duties andresponsibilities inconsistent with his status as Senior Vice President andChief Financial Officer of the Company; (2) a change in Reporting Managers suchthat the Employee no longer directly reports to the Chief Executive Officer ofthe Company; or (3) the assignment of duties and responsibilities which are notcustomary for a person serving as Senior Vice President and Chief FinancialOfficer of an enterprise comparable to the Company;

 

(iii)          any material and willful breach of theCompany of any provision of this Agreement or any written employment agreementwith Employee; or

 

(iv)          a Change in Control as defined inSection 8.7 below.

 

(c)           ATermination for Good Reason, except pursuant to a Change of Control, shall nottake effect until the following has occurred:

 

(i)            the Employee has given the Board of Directors writtennotice of his intention to terminate his employment for Good Reason, specifyingwith particularity the grounds on which the proposed Good Reason Termination iscontemplated;

 

(ii)           the Board of Directors shall have thirty (30) days aftersuch written notice to cure such grounds; and

 

(iii)          if the Board of Directors fails to cure such grounds, thenthe Employee may terminate his employment by giving written notice to the Boardof Directors confirming that the grounds has not been cured, whereupon theEmployee’s employment shall terminate.

 

(d)           Inthe event of a termination of the Employee’s employment hereunder pursuant toSection 8.5(a) hereof, the Employee shall be entitled to receive the sameconsideration set forth in Section 8.4(b) hereof.

 

8.6           Options; Repurchase of Shares.

 

Except as otherwisepermitted herein, upon the termination of the Employee’s

 

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employment pursuant to this Section 8 for any reason,all further vesting on all stock options and/or restricted stock in the Companyheld by the Employee shall immediately cease as of such date and thereafter anyvested stock options shall be exercisable and any restricted stock or otherequity securities held by the Employee shall be subject to repurchase by theCompany in accordance with their respective terms and the terms of any relatedagreements between the Company and the Employee.

 

8.7           Changeof Control.

 

(a)           Notwithstanding anything to the contrary andin addition to any other rights contained in this Agreement, fifty percent(50%) of the Employee’s then remaining unvested options shall automaticallybecome vested immediately prior to the occurrence of a Change in Control of theCompany.

 

(b)           Notwithstandinganything to the contrary and in addition to any other rights contained in thisAgreement, if the Employee’semployment is terminated by the Company without Cause or by the Employee for Good Reason within twelve (12) monthsfollowing a Change of Control, then, in addition to the consideration set forthin Section 8.4(b) hereof, all of the Employee’sthen remaining unvested options shall automatically become vested immediately.

 

** **(c)          Forthe purposes of this Agreement, a “Changeof Control” shall mean:  (i) the sale, transfer, assignment or otherdisposition (including by merger or consolidation) by stockholders of theCompany, in one transaction or a series of related transactions, of a majorityof the voting power represented by the then outstanding capital stock of theCompany to one or more stockholders or other third parties, other than any suchsales, transfers, assignments or other dispositions by such stockholders totheir respective heirs or affiliates, such that the then existing shareholdersof the Company do not own more than thirty-three percent (33%) of theoutstanding equity; or (ii) a sale, transfer, assignment or other disposition(including by merger or consolidation), of all of the outstanding stock of theCompany, or of all or substantially all of the assets of the Company or aliquidation or dissolution of the Company.

 

8.8           NoMitigation or Offset

 

                                                                TheEmployee shall not be obligated to seek or secure new employment or to becomeself-employed after termination of his employment with the Company, but shallbe obligated to report promptly to the Company any actual employment obtainedduring the period for which Employee benefits continue.  There shall be no offset against any amountsdue to Employee under this Agreement on account of any remuneration or benefitsattributable to any subsequent employment (including, without limitation, anyself-employment) that Employee may obtain.

 

9.             Representations, Warranties andCovenants of the Employee.

 

 (a)          TheEmployee represents and warrants to the Company that:

 

(i)            There are no restrictions,agreements or understandings whatsoever to which the Employee is a party whichwould prevent or make unlawful the Employee’s execution of this Agreement orthe Employee’s employment hereunder, or which is or would be inconsistent or inconflict with this Agreement or the Employee’s employment hereunder, or wouldprevent, limit or impair in any way the performance by the Employee of theobligations hereunder; and

 

(ii)           The Employee has disclosed to theCompany all restraints, confidentiality commitments or other employmentrestrictions that the Employee has with any other employer, person or entity.

 

(b)           Upon and after the Employee’stermination or cessation of employment with the Company and until such time asno obligations of the Employee to the Company hereunder exist, the Employee(i) shall provide a complete copy of this Agreement to any prospectiveemployer or other person, entity or association in the Business, with whom orwhich the Employee proposes to be employed, affiliated, engaged, associated orto establish any business or remunerative relationship prior to thecommencement thereof and (ii) shall notify the Company of the name and addressof any such person, entity or association prior to the Employee’s 

 

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employment,affiliation, engagement, association or the establishment of any business orremunerative relationship.

 

10.           Survival of Provisions.  The provisions of this Agreement set forthin Sections 5 through 22 hereofshall survive the termination of the Employee’s employment hereunder.

 

11.           Successors and Assigns.  This Agreement shall inure to the benefit ofand be binding upon the Company and the Employee and their respectivesuccessors, executors, administrators, heirs and/or permitted assigns; providedthat neither the Employee nor the Company may make any assignments of thisAgreement or any interest herein, by operation of law or otherwise, without theprior written consent of the other parties hereto, except that, without suchconsent, the Company may assign this Agreement to any successor to all orsubstantially all of its assets and business by means of liquidation,dissolution, merger, consolidation, transfer of assets, or otherwise, providedthat such successor assumes in writing all of the obligations of the Companyunder this Agreement.

 

12.           Notice.  Any notice hereunder by either party shallbe given by personal delivery or by sending such notice by certified mail,return-receipt requested, or by overnight delivery with a reputable courierservice, or telecopied, addressed or telecopied, as the case may be, to theother party at its address set forth below or at such other address designatedby notice in the manner provided in this section.  Such notice shall be deemed to have been received upon the dateof actual delivery if personally delivered or, in the case of mailing, two (2)days after deposit with the U.S. mail, or if by overnight delivery, the date ofdelivery or, in the case of facsimile transmission, when confirmed by thefacsimile machine report.

 

If to theEmployee:

 

                Kenneth R. Vines

                6905 Whisperfield

                Plano, TX  75024

                Fax:  214-775-0912

 

with a copy to:

 

Daniel W. Rabun

Baker & McKenzie

2001 Ross Avenue

Suite 2300

Dallas, Texas 75201

Fax: 214-978-3099

 

If to the Company:

 

EXE Technologies,Inc.

8787 StemmonsFreeway

Dallas, TX  75247

Attention:  CEO

Fax:  214-775-0912

 

with a copy to:

 

EXE Technologies,Inc.

300 Baldwin TowerBoulevard

Eddystone, PA19022

Attention:  General Counsel

Fax:  610-447-1824

 

13.           Entire Agreement; Amendments.  This Agreement contains the entire agreementand understanding of the parties hereto relating to the subject matter hereof,and merges and supersedes all prior and contemporaneous discussions, agreementsand understandings of every nature between the parties hereto relating

 

9

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to the employmentof the Employee with the Company, including but not limited to, the TermSheet.  This Agreement may not bechanged or modified, except by an agreement in writing signed by each of theparties hereto.

 

14.           Waiver.  The waiver of the breach of any term orprovision of this Agreement shall not operate as or be construed to be a waiverof any other or subsequent breach of this Agreement.

 

15.           Governing Law.  This Agreement shall be construed andenforced in accordance with the laws of the State of Texas, without regard tothe principles of conflicts of laws of any jurisdiction.

 

16.           Invalidity.  If any provision of this Agreement shall bedetermined to be void, invalid, unenforceable or illegal for any reason, thenthe validity and enforceability of all of the remaining provisions hereof shallnot be affected thereby.  If anyparticular provision of this Agreement shall be adjudicated to be invalid orunenforceable, then such provision shall be deemed amended to delete therefromthe portion thus adjudicated to be invalid or unenforceable, such amendment toapply only to the operation of such provision in the particular jurisdiction inwhich such adjudication is made; provided that if any provision contained inthis Agreement shall be adjudicated to be invalid or unenforceable because suchprovision is held to be excessively broad as to duration, geographic scope,activity or subject, then such provision shall be deemed amended by limitingand reducing it so as to be valid and enforceable to the maximum extentcompatible with the applicable laws of such jurisdiction, such amendment onlyto apply with respect to the operation of such provision in the applicablejurisdiction in which the adjudication is made.

 

17.           Section Headings.  The section headings in this Agreement arefor convenience only; they form no part of this Agreement and shall not affectits interpretation.

 

18.           Number of Days.  In computing the number of days for purposesof this Agreement, all days shall be counted, including Saturdays, Sundays andlegal holidays; provided that if the final day of any time period falls on aSaturday, Sunday or day which is a legal holiday in Texas, then such final dayshall be deemed to be the next day which is not a Saturday, Sunday or legalholiday.

 

19.           Specific Enforcement; Extension ofPeriod.

 

(a)           The Employee acknowledges that therestrictions contained in Sections 5, 6, and 7 hereof are reasonable andnecessary to protect the legitimate interests of the Company and its affiliatesand that the Company would not have entered into this Agreement in the absenceof such restrictions.  The Employee alsoacknowledges that any breach by the Employee of Sections 5, 6, or 7 hereof willcause continuing and irreparable injury to the Company for which monetary damageswould not be an adequate remedy.   TheEmployee shall not, in any action or proceeding to enforce any of theprovisions of this Agreement, assert the claim or defense that an adequateremedy at law exists.  In the event ofsuch breach by the Employee, the Company shall have the right to enforce theprovisions of Sections 5, 6, and 7 of this Agreement by seeking injunctive orother relief in any court, and this Agreement shall not in any way limitremedies of law or in equity otherwise available to the Company.

 

(b)           The periods of time set forth inSections 5, 6 and 7 hereof shall not include, and shall be deemed extended by,any time required for litigation to enforce the relevant covenant periods,provided that the Company is successful on the merits in any suchlitigation.  The “time required forlitigation” is herein defined to mean the period of time commencing on theearlier of the Employee’s first breach of such covenants or the service ofprocess upon the Employee ending on the expiration of all appeals related tosuch litigation.

 

20.       Arbitration.  Except for claimsor disputes related to the rights and obligations of the parties set forth inSections 5, 6 and 7 hereof, the parties hereto agree that any controversy orclaims arising out of or relating to this Agreement shall be settledexclusively by arbitration in accordance with the National Rules for theResolution of Employment Disputes of the American Arbitration Association(“AAA”) as then in effect.  The partieshereto further agree that any arbitration proceeding commenced in connectionwith this Agreement shall take place in Dallas, Texas under the auspices of theAAA and judgment upon the award rendered by the Arbitrator(s) may be entered inany court having jurisdiction thereof. The prevailing party shall be entitled to recover, in addition to anyother relief, reasonable attorneys’ fees, costs and disbursements.

 

10

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21.           Consent to Suit.  In the case of any dispute under or inconnection with this Agreement, the Employee may only bring suit against theCompany in the Courts of the State of Texas in and for the County of Dallas orin the Federal District Court for such geographic location.  The Employee hereby consents to thejurisdiction and venue of the courts of the State of Texas in and for theCounty of Dallas or the Federal District Court for such geographic location,provided that such Federal Court has subject matter jurisdiction over suchdispute, and the Employee hereby waives any claim she may have at any time asto forumnonconveniens with respect to such venue.  The Company shall have the right toinstitute any legal action arising out of or relating to this Agreement in anyappropriate court and in any jurisdiction. Any judgment entered against either of the parties in any proceedinghereunder may be entered and enforced by any court of competentjurisdiction.  If an action at law or inequity is necessary to enforce or interpret the terms of this Agreement, thenthe prevailing party shall be entitled to recover, in addition to any otherrelief, reasonable attorneys’ fees, costs and disbursements.

 

                                22.           Counterparts.  This Agreement may be executed in one ormore counterparts, each of which shall be deemed an original, and all of whichtogether shall be deemed to be one and the same instrument.

 

                                IN WITNESSWHEREOF, the parties have caused this Agreement to be executed on the day andyear first written above.

 

 
| EXE TECHNOLOGIES, INC.                |
|---------------------------------------|
|                                  |
|                                  |
| By:  /s/ Raymond R. Hood         |
|                                  |
| Title:  Chief  Executive Officer |
|                                  |
|                                  |
| /s/ Kenneth R. Vines                  |
|                                  |
| EMPLOYEE                              |

 

11

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**SCHEDULE A**

 

**EMPLOYMENT and COMPENSATION**

 

 
| **Position:**              | Through May 14, 2002, Director of Finance                                                                                                                          |
|----------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                       | Thereafter, Senior Vice President, Chief Financial  Officer and Treasurer                                                                                          |
|                       |                                                                                                                                                               |
| **Reporting  Manager:**    | CEO                                                                                                                                                                |
|                       |                                                                                                                                                               |
| **Start  Date:**           | May 13, 2002                                                                                                                                                       |
|                       |                                                                                                                                                               |
| **Base  Salary:**          | $225,000                                                                                                                                                           |
|                       |                                                                                                                                                               |
| **Bonus:**                 | 50% of Base Salary, based upon written criteria to be  developed by the Reporting Manager and the Employee                                                         |
|                       |                                                                                                                                                               |
| **Responsibilities:**      | Job Description attached as Schedule B                                                                                                                             |
|                       |                                                                                                                                                               |
| **Prohibited  Companies**: | Manhattan Associates, Optum, TRW/Marc, Provia,  Irista, High Jump, V3, Retek, Catalyst, OMI, McHugh Software, SAP supply  chain unit and Oracle supply chain unit. |

 

 

**Initial Stock Option Grant****:**

 

**A stockoption to purchase 250,000 shares of Common Stock, par value $.01 per share, ofthe Company was granted to the Employee on the Start Date.  The Option grant shall be an incentive stockoption to the maximum extent permitted by law. The exercise price is $1.52 pershare.  The vesting will be as follows:**

 

(a) 62,500 shareson the first anniversary of the Start Date; and

 

(b) the remaining187,500 shares at a rate of 2.0833% per month on the last day of each monthbeginning June 30, 2003.

 

 

A-1

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                                                                                           **SCHEDULE B**

 

# **RESPONSIBILITIES**

 

 

 

#### **JOB DESCRIPTION**

 

**[TO BEADDED]**

 

B-1

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**SCHEDULE C**

 

**EXE TECHNOLOGIES, INC.**

 

1997 INCENTIVE ANDNON-QUALIFIED STOCK OPTION PLAN

 

** [PREVIOUSLY PROVIDED]**

 

C-1

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**SCHEDULE D**

 

 

PRIOR INVENTIONS

 

None.

 

D-1

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**SCHEDULE E**

**NON SALARY CONSIDERATION**

 

 

 
| 1.     | Holidays - 10 paid.                                                                                                                                                                                      |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                                                                                                     |
| 2.     | Vacation - 4 weeks.                                                                                                                                                                                      |
|   |                                                                                                                                                                                                     |
| 3.     | Medical Plan — Employer/Employee paid.                                                                                                                                                              |
|   |                                                                                                                                                                                                     |
| 4.     | Dental Plan — Employer/Employee paid.                                                                                                                                                               |
|   |                                                                                                                                                                                                     |
| 5.     | Life Insurance/AD&D - equal to $50,000 —  Employer paid.                                                                                                                                        |
|   |                                                                                                                                                                                                     |
| 6.     | Vision plan —  Employer paid — provides 20% to 60% discount on all vision services.                                                                                                            |
|   |                                                                                                                                                                                                     |
| 7.     | Flexible Benefit  Plan - enables employees to set aside pre-tax dollars for the reimbursement  of certain qualified expenses.                                                                            |
|   |                                                                                                                                                                                                     |
| 8.     | Short-term  Disability — Employer paid - provides potential salary continuation to  regular, full-time employees who are unavoidably absent from work due to  personal illness injury or pregnancy. |
|   |                                                                                                                                                                                                     |
| 9.     | Long-term  Disability — Employer paid - provides income protection in the event of a  long-term disability, equal to 60% of basic monthly earnings.                                                 |
|   |                                                                                                                                                                                                     |
| 10.    | 401(k) Plan -  permits deferral of pre-tax dollars up to 15% of salary.  Company matches 100% of first 5%  contribution.                                                                            |
|   |                                                                                                                                                                                                     |
| 11.    | Tuition  Assistance — provides educational reimbursement benefits to eligible  employees.                                                                                                           |

 

E-1

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