Document:

EXHIBIT 10.62

 

Confidential Settlement Communication

Subject to Rule 408 of the Federal Rules of Evidence

 

	
   

  	
  |__|
  Company’s Copy

  
	
   

  	
  |__|
  Holmes’s Copy

  

 

PLEASE READ THIS AGREEMENT CAREFULLY.

IT CONTAINS A RELEASE OF KNOWN AND UNKNOWN CLAIMS.

 

To
Jeffrey L. Holmes:

 

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

 

Resignation

 

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

 

Services

 

You
have agreed to assist Manugistics after the Separation Date in supporting the
Government, Aerospace and Defense group. 
In performing these duties, you will report to the person(s) specified
by the CEO. You will provide such services for no extra compensation during the
Severance Period.  You agree that the CEO
may require you to perform these services during regular office hours at the
headquarters offices of the Company or, as you otherwise agree or as is within
reasonable commuting distance for you, at another office of the Company.  You agree that any expenses you incur in
providing these services are subject to a budget to be approved by the CEO and
are subject to the Company’s ordinary procedures for substantiation and
reimbursement.

 

Commission
Arrangements

 

Manugistics
and you have agreed to certain commission arrangements with respect to certain
specified areas:

 

Key
Defense

 

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

 

Other

 

Manugistics
will treat you as its non-exclusive agent in territories to be agreed upon in
writing for the first two years after the date of this Agreement with respect
to its Government, Aerospace, and Defense business.  During the Agency Period, you must submit a
written proposal to Manugistics for any transaction you wish to pursue under
this section.  Manugistics, in its sole
discretion may accept (an “Accepted Proposal”) or reject a proposal.   Manugistics and you will share the Net
License Revenue generated from Accepted Proposals at a split of 30% for you and
70% for Manugistics. Payment to you under this Other provision is only if and
when Manugistics collects its fees with respect to the Accepted Proposals.  Manugistics will only reimburse you for
pre-approved expenses on Accepted Proposals subject to compliance with the
Company’s ordinary procedures for substantiation and reimbursement.

 

 

Further
Conditions

 

All
payments under this Commission Arrangements section are conditioned on (i) your
continued compliance with the terms of this Agreement, including the
restrictive covenants contained in it, and (ii) your providing
demonstrable efforts and your being available to support Manugistics’ efforts
with respect to the matters covered by the commissions.  These conditions are not intended to prevent
your obtaining employment after the Severance Period.

 

Payment

 

Contingent
upon the lapse of the Revocation Period without your revoking the Release, the
Company will pay to you, or to your estate in the event of your death, a total
of 26 weeks’ salary in regular payroll intervals as though you had
remained employed for that number of weeks (the “Severance Period”), each
reduced by any federal or state withholding taxes or other required deductions
normally deducted from your pay (and reduced for any stub pay periods at the
beginning or end of the payments). You agree that, in the absence of this
Agreement, your entitlement to this payment would be uncertain and that your
benefits under this Agreement are more than adequate consideration for the
Release.  The parties have agreed to
these payments in connection with your resignation to avoid any dispute
regarding the terms and conditions of your departure.  On or after your Separation Date, you will
also receive $18,842.31 as accrued vacation pay, increased by any accruals
before the Separation Date decreased by any amounts paid or taken as vacation
before such date of payment under this Agreement.

 

Equity
Compensation

 

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

 

Limitations
on Other Benefits or Compensation

 

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

 

Effect
of Other Employment

 

You
acknowledge and agree that if you become employed by another entity at any point
after the Separation Date, all payments and benefits under this Agreement will
cease as of the effective date of such employment, and the date of such
employment will be treated as the end of the Severance Period for purposes of
the Equity Compensation section.  You
agree that you will have received adequate consideration for this Agreement
even if you receive no payments under the Payments section above because
you had the opportunity to receive such payments.

 

Release
of Claims

 

You,
for yourself and your heirs, executors, administrators, representatives, and
assigns, as a free and voluntary act, release and discharge Manugistics and any
related entities including parent, divisions, subsidiaries, or affiliates, and
their present, former, and future employees, officers, directors, stockholders,
counsel, and anyone acting or purporting to act on behalf of any of them, from
any and all debts, obligations, demands, claims, judgments or causes of action
of any kind whatsoever, whether now known or unknown, in tort, in contract, by
statute, or any other basis for compensatory, punitive or other damages,
expenses, reimbursements or costs of any kind relating to your employment by
Manugistics or any associated or affiliated company or the cessation of such employment
relationship and all circumstances related thereto.  This release and discharge includes, but is
not limited to, any and all claims, demands, rights and/or causes of action,
arising up to the date of this Release, including those that might arise out of
allegations relating to any claimed breach of an alleged oral or written
contract, or any purported employment discrimination or civil rights
violations, or any alleged acts of slander, libel, or intentional infliction of
emotional distress, and any claims to have been treated unfairly or in a manner
contrary to articles or by-laws as a director or officer of any of the
Manugistics entities.  Manugistics
specifically disclaims any liability to, or for wrongful acts against, you or
any other person on the part of itself, its shareholders, subsidiaries,
affiliates, and successors and the directors, officers, employees and agents of
each of them.

 

This
Release includes but is not limited to a release of any rights or claims you
may have under the Age Discrimination in Employment Act of 1967, as amended (“ADEA”),
which prohibits age discrimination in employment; Title VII of the Civil Rights
Act of 1964, as amended, which prohibits discrimination in employment based on
race, color, national origin, religion or sex; the Equal Pay Act, which
prohibits paying men and women unequal pay for equal work; the Americans with
Disabilities Act of 1990,

 

 

which
prohibits discrimination against disabled persons; the Vocational
Rehabilitation Act of 1973, which prohibits discrimination against handicapped
persons; the Civil Rights Act of 1991, the Maryland Civil Rights Act, and any
other federal, state, or local laws or regulations prohibiting employment
discrimination; and any claim for reinstatement.  This also includes your release of any claims
for wrongful discharge, breach of contract (express or implied), breach of any
covenant of good faith and fair dealing (express or implied), any claims that
Manugistics has dealt with you unfairly or has denied you any rights under its
policies and procedures or any other claims arising under common or civil law
and relating to your employment or termination, and any claims under the
Employee Retirement Income Security Act of 1974, which regulates employee
benefit plans and also prohibits actions taken to discharge or discriminate
against someone to prevent his exercising any right under an employee benefit
plan or to interfere with his attainment of any such right.  It does not release claims under ADEA or on
any other basis that arise after the date you sign this Release.

 

Known
and Unknown Claims

 

To
implement a full and complete release and discharge, you expressly acknowledge
that this Release is intended to include in its effect, without limitation, all
claims you do not know or suspect to exist in your favor at the time of
execution of this Release.  You agree
that this Release contemplates the extinguishment of any such claim or claims.

 

Period
for Consideration

 

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

 

Indemnification

 

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

 

No
Reliance

 

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

 

Settlement

 

The
parties have reached this Agreement and Release to, among other things, settle
any claims or potential claims relating to your employment or the termination
of your employment that you have or may have against Manugistics and any
related entities including parent, subsidiaries, successors, or affiliates, and
their present, former and future employees, officers, trustees, partners,
shareholders, counsel, and anyone acting or purporting to act on behalf of any
of them.  Neither this Agreement nor any
other document or written or oral statement prepared or made in connection with
this Agreement, nor any discussion of the matters referred to in this Agreement
nor any payment under this Agreement, constitutes, or should be deemed to
constitute, (A) an admission of law or fact or an admission of any
liability or wrongdoing by you or Manugistics with respect to any claims,
unasserted claims, or demands relating to or arising out of or in connection
with any matter whatsoever (and Manugistics specifically denies any such
liability or wrongdoing) or (B) evidence of any matter whatsoever, except
for the agreement expressly set forth in this Agreement.

 

Solicitation
of Employees or Clients; Noncompetition

 

You
agree that until the Separation Date and for one year thereafter, you will not,
directly or indirectly, (a) solicit the employment of or employ, for yourself
or for any other person or business, any Manugistics employee or any person who
was a Manugistics employee at any time during the one year period preceding the
end of the Severance Period, or (b) solicit or attempt to solicit business
from, provide services to (in competition with Manugistics), or secure
employment with any person or entity that was, a customer of Manugistics during
your employment with Manugistics, or any person or business to whom Manugistics
had proposed future work within one year before the end of the Severance Period
(as to

 

 

which
you have expended demonstrated efforts), including  those to be agreed to by you and Manugistics,
together with any additional clients or customers as to which you may be
entitled to compensation under the Commission Arrangements section, or any
systems integrator which could propose a competitive alternative to displace
Manugistics at a “government” site where Manugistics products are currently
installed or which proposes to bid or is bidding on any deal listed on the Deal
List.  As a further protection that
Manugistics’ trade secrets and other confidential information will not be
disclosed to its competitors, you agree that you will not accept employment, as
either an employee or consultant, with any competitor of Manugistics listed on Schedule I
to this Agreement within one year following the end of the Severance
Period.  You agree that the one year
restrictive periods in this section will extend to a total of 18 months if
you receive at least $100,000, before taxes, from the arrangements described
above under Commission Arrangements. Nothing in this paragraph is to be
interpreted as restraining your freedom to provide services to such customer,
business, or person as a bona fide employee so long as Manugistics agrees in
writing that such employment does not utilize knowledge or information you
acquired during your tenure with Manugistics, which consent shall not be
unreasonably withheld.  If this provision
were found to be unenforceable, the court so deciding may reduce the time
periods provided for in this paragraph to allow this provision to be enforced.
You understand and acknowledge that Manugistics may communicate the terms or
substance of this section to any other entity, including ones from which you
may seek employment, without any prior or concurrent notice to you.

 

No
Disparaging Comments

 

Except
as the law may require, you agree that you will not in any way, directly or
indirectly, to any employee of Manugistics or to any other person (including
any communications with the press or other media), make any statement that
could reasonably be interpreted to criticize or disparage the performance,
competency, or ability of Manugistics or its affiliates as a provider of
software or other products and services, or the officers, directors, employees,
or agents of any of them at any time after the execution of this Agreement, nor
will you do or say anything that likely would have the effect of disrupting or
impairing Manugistics’ normal, ongoing business operations or harming
Manugistics’ reputation with its associates, employees, clients, investors,
suppliers, dealers, acquisition prospects, or the public.  Except as the law may require, Manugistics
agrees that it will not make any authorized statement to any of its employees
or to any other person (including any communications with the press or other
media) that could reasonably be interpreted to criticize or disparage your
performance, competency, or ability at any time after the execution of this
Agreement, and will take reasonable steps to discourage its directors,
officers, and employees from making statements inconsistent with that
undertaking.  It will not be a violation
of this paragraph for either party to make truthful statements, under oath, as
required by law or formal legal process or in compliance with the securities
laws.  This paragraph does not prohibit
Manugistics or you from communicating any alleged misconduct to appropriate
management personnel at Manugistics, to the audit committee of the Board, or to
an appropriate governmental entity, or from cooperating with any of the
foregoing in any investigation.  By
entering into this agreement, you agree to make yourself available as
reasonably requested by Manugistics or the Board’s audit committee in
connection with any such investigation.

 

Client
Contacts

 

Through
the 12 month anniversary of the Separation Date, you agree that, if you are
contacted by any current, former, or prospective clients of Manugistics with
respect to its current or prospective business, you will refer the contacting
person or entity to the CEO for reply or further communications, except as and
to the extent that the CEO asks you to respond.

 

Return
of Property

 

Except
as provided in this section, on or before Separation Date and again on such one
or more dates after such date as Manugistics directs, you agree to deliver to
Manugistics any office equipment (including computers), keys, and other access
devices, and any confidential information or other materials (written or
otherwise) not available to the public or made available to the public in a
manner you know or reasonably should recognize Manugistics did not authorize,
and any copies, excerpts, summaries, compilations, records, or documents you
made or that came into your possession during your employment. You agree that
you will not retain copies, excerpts, summaries, or compilations of the
foregoing information and materials.  You
will return any and all files (whether hard copies or in electronic form).  Manugistics agrees that you may retain the
Blackberry and the Dell computer that you have been using, after Manugistics
has removed any trade secrets and confidential information; provided that you
shall be responsible for all of the ongoing charges associated with their use
and the use of your cell phone from and after the Separation Date.

 

Cooperation

 

You
agree to cooperate with, provide assistance to, and make yourself reasonably
available to Manugistics and its legal counsel in connection with any
litigation (including arbitration or administrative hearings) or investigation
or examination relating to Manugistics or any of its current or former
employees, in which, in the judgment of Manugistics or its counsel, your
assistance or cooperation is needed due to your personal involvement in or
knowledge about the circumstances to which the litigation or investigation
relates. You will, when Manugistics or its legal counsel requests, provide
testimony, be available for interviews or other assistance and travel at Manugistics’
request in order to fulfill this obligation. In connection with such litigation
or investigation, Manugistics will use its best efforts to accommodate your
schedule, will provide you with as much notice as possible in advance of the
times during which your cooperation or assistance is needed (but in no event
less than [10] days’ prior notice), and will reimburse you for any reasonable
expenses incurred in connection with such matters.  You agree not to assist or provide
information to any adverse party in any litigation against Manugistics or any
of its current or former employees, except as required under law or formal
legal process, unless you provide advance notice to Manugistics at least [10]
days before such assistance or provision of information (or, if

 

 

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

 

Entire
Agreement and Continuing Obligations

 

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

 

Binding
Effect

 

This
Agreement binds any and all successors and assigns of Manugistics and your
heirs and beneficiaries.

 

Withholding

 

All
payments under this Agreement will be reduced by any federal or state
withholding taxes or other required deductions.

 

Arbitration

 

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

 

Governing
Law

 

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

 

Effectiveness

 

This
Agreement does not become effective until it has been executed and delivered by
both Manugistics and you.

 

Signatures on Page Following

 

THIS IS A RELEASE — READ CAREFULLY BEFORE SIGNING.

YOU SHOULD CONSULT WITH AN ATTORNEY.

 

You
acknowledge that you have read this Agreement, understand it, and are
voluntarily entering into it.

 

	
   

  	
   

  	
  Manugistics Group, Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Date
  Signed

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Witness:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Signed:
  

  	
   

  	
   

  
	
   

  	
  Date
  Signed: 

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
															

 

Accepted
and agreed to:

 

 

	
   

  	
   

  	
   

  	
   

  	
  /s/

  	
   

  	
   

  
	
       Date
  Signed

  	
   

  	
  Jeffrey L. Holmes

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Witness:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   Signed:

  	
   

  	
   

  
	
   

  	
   Date
  Signed:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
										

 

 

Holmes Agreement

Schedule I

Competitors

 

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

 

i2 Technologies, Inc.

SAP, AG

Oracle

Logility

GLog

Red Prairie

Manhattan Associates

Demantra

Xelus

 

 

Exhibit A

 

	
  Life
  Insurance Company

  	
   

  	
  Amount
  of Benefit

  	
   

  
	
  First
  Colony Life Insurance Company

  	
   

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

  	
   

  

 

	
  Health
  and Medical Coverage

  	
   

  	
  Level
  of Coverage

  	
   

  	
  Portable

  	
   

  
	
  Standard
  Plan PPO/Non-PPO

  	
   

  	
  Employee
  + Dependent

  	
   

  	
  COBRA
  coverage at your expense (beginning at the end of the Severance Period)

  	
   

  

 

401(k)
Plan

 

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

 

Professional
Services

 

This
benefit will continue during the severance period for preparation and filing of
tax returns for 2004.

 

Physical
Exam

 

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

 

Additional
Life Insurance Coverage:

 

In
addition to the First Colony Life Insurance Company policy described above,
Manugistics, Inc. will reimburse you up to $1,000.00 for the cost of new
life insurance premiums on policies you obtain on your life to cover you during
the Severance Period.EXHIBIT 10.63

 

	
  Notice
  of Grant of Stock Option

  	
  MANUGISTICS
  GROUP, INC.

  
	
  and
  Option Agreement

  	
  ID:
  52-1469385

  
	
  (the
  “Option Agreement”)

  	
  9715
  KEY WEST AVENUE

  
	
   

  	
  ROCKVILLE
  MD 20850

  

 

	
  Kevin C. Melia

  	
  Grant Number:

  	
  00012043

  
	
  24 Grasshopper Lane

  	
  Plan:

  	
  1998

  
	
  Acton, MA 01720

  	
  ID:

  	
  MELI

  
	
  United States

  	
   

  	
   

  

 

Dear Kevin:

 

Effective April 7, 2005 you have been granted a Non-Qualified
Stock Option (the “Stock Option”) under the Company’s Amended and Restated 1998
Stock Option Plan (“Plan”) to buy 100,000 shares of Manugistics Group, Inc.
(the “Company”) common stock at an exercise price of  $1.8000 per share, with an expiration date of
April 7, 2015.    The total exercise
price to acquire all of the shares granted is $180,000.

 

The shares will vest: Quarterly over five years
on the 7th day of July, October, January and April, commencing July 7,
2005.

 

To the extent shares are vested, you may exercise the Stock Option in
minimum increments of 50 shares or, if fewer, the total number of shares then
exercisable.  At the time of exercise,
you are required to pay the exercise price and the applicable taxes by cash or
check in U.S. dollars.

 

Upon a “Change in Control” of the Company
any unvested portions of the stock option award shall immediately vest.

 

A Change in Control for this purpose means the occurrence of any one or
more of the following events:

 

(i) sale of all or substantially all of the assets of the Company
to one or more individuals, entities, or groups acting together;

 

 (ii) a person, entity, or
group acquires or attains ownership of more than 50% of the undiluted total
voting power of the Company’s then-outstanding securities eligible to vote to
elect members of the Board (“Company Voting Securities”);

 

(iii) completion of a merger, consolidation, or reorganization of
the Company with or into any other entity unless the holders of the Company
Voting Securities outstanding immediately before such completion, together with
any trustee or other fiduciary holding securities under a Company benefit plan,
retain control because they hold securities that represent immediately after
such merger or consolidation at least 50% of the combined voting power of the
then outstanding voting securities of either the Company or the other surviving
entity or its ultimate parent;

 

The Board or the Compensation Committee will have the same authority to
determine the existence of a Change in Control under this definition as it has
under the Plan.

 

If you leave the Board of Directors you shall forfeit the portion of
the Stock Option that has not vested on the last day of your Board service;
provided that if you are asked to resign from the Board, other than for Cause,
or you are not nominated for election to an additional term on the Board, other
than for Cause, no portion of the Stock Option shall be forfeited upon
termination of your Board service; and provided further that if your Board
service is terminated by your death, the executor or administrator of your
estate shall have the right to exercise within one year of your date of death
all or any part of the portion of the Stock Option that were vested on the date
of your death.  “Cause” shall be defined
as a good faith determination by the Board that you, in or related to the
performance of your duties, have not acted in good faith and in a manner to be
in or not opposed to the best interests of the Company

 

By your acceptance, you agree
that this Stock Option is granted under the Plan and is governed by this Option
Agreement and the terms and conditions of the Plan.  A copy of the Plan is incorporated by this
reference and can be found in your Grant Package. As stated in Section 5(c) of
the Plan, any interpretations, decisions, or actions made by the Committee
administering the Plan will be final, conclusive and binding.  The grant of this Stock Option shall not
prevent the Company from terminating or modifying the conditions of your
position at any time.

 

Please sign one copy of this Option Agreement and return to
Manugistics, Inc, Stock Plan Administration, 9715 Key West Avenue, Rockville,
MD 20850.  The other copy is for your
records

 

 

	
  Name:

  	
   

  	
   

  	
  Date:

  	
   

  
	
  Kevin
  Melia

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