exv10w3



 





Exhibit 10.3




SEPARATION AGREEMENT




     This Separation Agreement (“Agreement”) is made and entered into by and
between Craig Conway (“Executive”), and PeopleSoft, Inc. (“Company”), is
effective when executed by both parties and is based upon the following:



RECITALS




     A. Executive has been employed by Company as its President and Chief
Executive Officer since May 1999.



     B. The Company has terminated Executive’s employment, as set forth below.



     C. This Agreement is entered into in order to document the parties
agreements regarding the termination.



     NOW THEREFORE, the parties agree that in full, sufficient and complete
consideration of the mutual promises and covenants contained herein, Executive
and Company hereby agree as follows:



AGREEMENT




     1. Termination of Employment. Effective as of 12:01 a.m. on October 1,
2004 (“Termination Date”), Executive was terminated from the employ of the
Company without Cause pursuant to section 4(d) of the Employment Agreement
entered into by Executive and the Company on May 10, 1999 and restated as of
May 27, 2003 (the “Employment Agreement”). Following the Termination Date and
Executive’s resignation as a member of the Board of Directors of the Company,
Executive shall no longer be designated as a Section 16(b) person of the
Company under the Securities Exchange Act of 1934, as amended.



     2. Accrued Salary and Paid Time Off. Executive has recieved payment,
subject to customary withholding and other taxes, on the Termination Date for
all earned and unpaid base salary, and all accrued and unused vacation as of
that date. Executive and Company acknowledge and agree that no deferred salary
remains payable to Executive, and
that there is no agreement to defer payment of any future salary to which
Executive may be entitled.



 









 





     3. Severance Benefits. Upon execution of this Agreement and the Mutual
Release of Claims attached hereto as Exhibit A, Executive will receive the
following severance benefits pursuant to section 4(d) of the Employment
Agreement in addition to the payments referenced in section 2:



          (i) In strict compliance with the Employment Agreement, with respect to
the Stock Options granted to Executive prior to the Termination Date, that
number of Stock Options that would have vested had Executive remained employed
by the Company for an additional twenty-four (24) months after the Termination
Date shall immediately have their vesting accelerated based on service-based
vesting provisions only;



          (ii) In strict compliance with the Employment Agreement, with respect to
the restricted stock grant of 500,000 shares awarded to Executive (grant number
034756), Executive will receive a cash payment equal to the fair market value
of the number of shares of restricted stock that would have vested pro rata
based on the number of months from the date of the grant through the
Termination Date;



          (iii) In strict compliance with the Employment Agreement, with respect to
the restricted stock grant of 150,000 shares awarded to Executive (grant number
045455), Executive will receive a cash payment equal to the fair market value
as of the Termination Date of the number of shares of restricted stock that
would have had their vesting accelerated as a result of twenty-four (24) months
service-based vesting;



          (iv) In variance of the Employment Agreement, Executive shall receive
within 5 days of the effective date a lump sum payment equal to $3,207,766.33
which equates to the Company’s obligation for continued payments of twenty-four
(24) months Base Salary and twenty-four (24) months Target Bonus discounted to
net present value, less applicable withholding obligations of the Company; and



          (v) In strict compliance with the Employment Agreement, the Company will
pay the group health, dental and vision plan continuation coverage premiums for
Executive and his covered dependents under Title X of the Consolidated Budget



 









 





Reconciliation Act of 1985, as amended (“COBRA”) or any applicable state law
that provides for such continuation coverage for the lesser of (A) twenty-four
(24) months from the Termination Date, or (B) the date upon which Executive and
his covered dependents are covered by similar plans of Executive’s new
employer.



     4. Other Compensation or Benefits. Executive acknowledges and agrees
that, except as expressly provided in this Agreement, Executive will not
receive and is not entitled to any additional compensation, severance or
benefits after the Termination Date except such payment, if any, as may be due
under section 16 (Golden Parachute Excise Taxes) of the Employment Agreement.



     5. Continuing Obligations. Executive reaffirms his existing and
continuing obligations set forth in the Employee Proprietary Information
Agreement (the “Proprietary Information Agreement”) that Executive signed, a
copy of which is attached hereto at Exhibit B. Executive acknowleges and
agrees that such obligations are continuing and survive the termination of
Executive’s employment with the Company.



     6. Taxes. Executive acknowledges and agrees that Executive shall be
personally responsible for the payment of any and all taxes which may be due on
the payments described in this Agreement, except for any FICA or other payroll
taxes which a state or federal government tax agency determines the Company was
obligated to pay on behalf of the Company. Executive further acknowledges that
the Company does not make and has not made any representations regarding the
taxability of any payment from the Company to Executive described in this
Agreement, and Executive has have not relied on any representations of the
Company on that subject. Executive further acknowledges that
Executive will indemnify and hold the Company harmless in the event any
taxing authority determines that tax obligations are due pursuant to the
payments made hereunder.



 









 





     7. The parties to this Agreement understand that each party is responsible
for bearing its own costs and attorneys’ fees incurred in connection with the
preparation and negotiation of this Agreement.



     8. Miscellaneous. This Agreement, including Exhibit A, which is hereby
incorporated by reference herein, constitutes the complete, final and exclusive
embodiment of the entire agreement between Executive and the Company with
regard to this subject matter. It is entered into without reliance on any
promise or representation, written or oral, other than those expressly
contained herein, and it supersedes any other such promises, warranties or
representations. This Agreement may not be modified or amended except in a
writing signed by Executive and a duly authorized officer of the Company. This
Agreement will bind the heirs, personal representatives, successors and assigns
of Executive and the Company, and inure to the benefit of Executive and the
Company, their heirs, successors and assigns. If any provision of this
Agreement is determined to be invalid or unenforceable, in whole or in part,
this determination will not affect any other provision of this Agreement and
the provision in question will be modified by the court so as to be rendered
enforceable. Each party shall bear its own costs, expenses and attorneys’ fees
incurred in negotiating and finalizing this Agreement. This Agreement will be
deemed to have been entered into and will be construed and enforced in
accordance with the laws of the State of California without regard to
principles of conflict of laws. Any dispute regarding the payments and
benefits described herein shall be subject to section 14 of the Employment
Agreement (Non-Binding Mediation, Arbitration and Equitable Relief); the
arbitrator’s fees in connection with any arbitration proceeding arising under
that section shall be paid by the Company.



     IN WITNESS WHEREOF, this Agreement has been executed in duplicate
originals on the dates indicated below, and shall become effective as indicated
above.



 









 





	 	 	 	 	 
	 	 	EXECUTIVE
	 
	 	 	 	 
	Dated: October 15, 2004

	 	By:	 	/s/ Craig Conway
	

	 	 	 	
 
	 
	 	 	 	 
	 
	 	PEOPLESOFT, INC.

	 
	 	 	 	 
	Dated: October 18, 2004

	 	By:	 	/s/ A. George Battle
	

	 	 	 	
 
	

	 	 	 	Member, Board of Directors
	Dated: October 17, 2004

	 	 	 	 
	

	 	By:	 	/s/ James P. Shaughnessy
	

	 	 	 	
 
	

	 	 	 	General Counsel







Exhibit A – Mutual Release of Claims




Exhibit B – Proprietary Information Agreement




 









 








EXHIBIT A




MUTUAL RELEASE OF CLAIMS




     This Release of Claims (“Release”) is entered into by and between Craig
Conway (“Executive”) and PeopleSoft, Inc. (“Company”) as follows:



     Executive understands and agrees to the terms in the foregoing Separation
Agreement (“Agreement”) and also understands that this Release, together with
the Agreement, constitutes the complete, final and exclusive embodiment of the
entire agreement between the Company and Executive with regard to the subject
matter hereof. Executive is not relying on any promise or representation by
the Company that is not expressly stated therein. Certain capitalized terms
used in this Release are defined in the Agreement.



     Except as otherwise set forth in this Release, Executive hereby releases
the Company and its parents, subsidiaries, successors, predecessors and
affiliates, and its and their current and former partners, members, directors,
officers, employees, stockholders, shareholders, agents, attorneys,
predecessors, insurers, affiliates and assigns (“Releasees”), from any and all
claims, liabilities and obligations, both known and unknown, that arise out of
or are in any way related to Executive’s compensation or benefits under the
Employment Agreement entered into by Executive and the Company on May 10, 1999
and restated as of May 27, 2003 (“Employment Agreement”), including without
limitation claims for salary, bonuses, commissions, vacation pay, expense
reimbursements, severance pay, fringe benefits, restricted stock, stock
options, or any other equity compensation or ownership interests in the Company
(other than compensation and benefits accrued on or before any termination of
employment).



     The Company, in turn, hereby releases Executive from any and all claims,
liabilities and obligations, both known and unknown, that arise out of or are
in any way related to Executive’s compensation or benefits under the Employment
Agreement, including without limitation claims for salary, bonuses,
commissions, vacation pay, expense reimbursements, severance pay, fringe
benefits, restricted stock, stock options, or any other equity compensation or
ownership interests in the Company (other than compensation and benefits
accrued on or before any termination of employment).



     The matters released herein do not include claims, liabilities and
obligations (i) of Executive pursuant to the Proprietary Information Agreement
signed by Executive, (ii) of the parties pursuant to the Indemnification
Agreement entered into by and between the Company and Executive on August 12,
2002, (iii) any indemnification rights of Executive under the Company’s
Certificate of Incorporation, the Company’s Bylaws, any vote of stockholders or
disinterested Directors, the General Corporation Law of the State of Delaware,
or any other law, statute or regulation, both as to action in Executives’s
official capacity and as to action in any other capacity while holding such
office, or (iv) of Company with respect to such payment, if any, as may be
due to Executive under section 16 (Golden Parachute Excise Taxes) of the
Employment Agreement.



 









 





     Executive and the Company represent and warrant that they each,
respectively, have the sole right and authority to execute this Release and
that they have not assigned or transferred, or purported to assign or transfer,
to any corporation, entity or person, any dispute or claims released herein or
any amount of money related thereto.



	 	 	 	 	 
	 	 	EXECUTIVE
	 
	 	 	 	 
	Dated: October 15, 2004

	 	By:	 	/s/ Craig Conway
	

	 	 	 	
 
	 
	 	 	 	 
	 
	 	PEOPLESOFT, INC.

	 
	 	 	 	 
	Dated: October 18, 2004

	 	By:	 	/s/ A. George Battle
	

	 	 	 	
 
	

	 	 	 	Member, Board of Directors
	Dated: October 17, 2004

	 	 	 	 
	

	 	By:	 	/s/ James P. Shaughnessy
	

	 	 	 	
 
	

	 	 	 	General Counsel