Document:

Exhibit 10.4

 

SEPARATION AND NON-COMPETE AGREEMENT AND MUTUAL
RELEASE

 

This
Separation and Non-Compete Agreement and Mutual Release (“Agreement”) is made
and entered into effective as of June 2, 2005 (“Effective Date”), by and
between John J. Coughlan, a Minnesota resident (“Employee”) and Lawson Software, Inc.,
a Delaware corporation (Lawson Software, Inc. and its subsidiaries are
referred to as the “Company”).

 

Background

 

A.                                   On June 2, 2005, the Company
publicly announced that:  (1) it
intends to acquire all of the outstanding capital stock of Intentia
International AB (“Intentia”) (the “Intentia Transaction”) and (2) the
Company has named a new chief executive officer of the Company (the “New CEO”);

 

B.                                     Subject
to the terms of this Agreement, Employee will continue as the current chief
executive officer of the Company (“CEO”) for the time period described below;

 

C.                                     Subject
to the terms of this Agreement, the Company will pay Employee the severance
benefits described below; and

 

D.                                    Subject to the terms of this Agreement,
Employee will not compete with the Company (for the time period and to the
extent described in Section 4 below), and Employee and the Company agree
to the mutual release, indemnification and other provisions described below.

 

Agreement

 

NOW, THEREFORE, in consideration of the mutual
promises and covenants established in this Agreement, Employee and the Company
agree as follows:

 

1.                                       Definitions.  In addition to the other capitalized terms
used in this Agreement, the following capitalized terms have the respective
meanings defined below:

 

1.1                                 Cause.  “Cause” means fraud or criminal conduct in
connection with the Company’s business, unless Employee was directed by a
director or executive officer of (or a superior within) the Company to engage in
such fraud or conduct

 

1.2                                 Planned
Full-Time Employment Period.  “Planned
Full-Time Employment Period” means the time period commencing on the Effective
Date of this Agreement and ending on June 30, 2005.

 

1.3                                 Full-Time
Employment Period.  “Full-Time Employment
Period “ means the time period commencing on the Effective Date of this
Agreement and ending on the earlier of:

 

(a)          the
end of the Planned Full-Time Employment Period;

(b)         Employee’s
death or total disability;

(c)          termination
of Employee by the Company for Cause;

 

1

 

(d)         Employee’s
material breach of this Agreement that is not cured within five business days
after written notice describing the breach; or

(e)          voluntary
resignation of Employee as CEO, unless such resignation is due to Company’s
material breach of this Agreement that is not cured within five business days
after written notice describing the breach.

 

1.4                                 Part-Time
Employment Period.  “Part-Time
Employment Period “ means the time period commencing at the end of the
Full-Time Employment Period and ending on the earlier of:

 

(a)          two
years after the end of the Planned Full-Time Employment Period;

(b)         voluntary
resignation of Employee as a part-time employee of the Company (unless such
resignation is due to Company’s material breach of this Agreement that is not
cured within five business days after written notice describing the breach);

(c)          termination
of Employee by the Company for Cause; or

(d)         Employee’s
material breach of this Agreement that is not cured within five business days
after written notice describing the breach (unless preceded by or simultaneous
with Company’s material breach of this Agreement that is not cured within five
business days after written notice describing the breach).

 

1.5                                 Employment
Period.  “Employment Period” means
the time period commencing on the Effective Date of this Agreement and ending
on the latter of the end of the Full-Time Employment Period or the end of the
Part-Time Employment Period.

 

2.                                       Employment
and Employee Obligations.

 

2.1                                 Full-Time
Employment With the Company. 
Throughout the Full-Time Employment Period, Employee shall be a
full-time employee of the Company, reporting to the Company’s Board of
Directors.  Unless otherwise instructed
by the Company’s Board of Directors, throughout the Full-Time Employment Period
Employee shall continue to provide Employee’s full-time, good faith efforts
towards the success of the Company (consistent with Employee’s past practices)
and the transition to a new chief executive officer.

 

2.2                                 Resignation
as an Officer and Director of the Company. 
Employee hereby confirms that Employee will be deemed to have
voluntarily resigned as CEO, president, an executive officer and as a director
of the Company effective as of June 14, 2005.

 

2.3                                 Employee
Invention and Non-Disclosure Agreement. 
Exhibit A to this Agreement is substantially the same form of the
Employee Invention and Non-Disclosure Agreement as previously entered into
between the Company and Employee, which will continue in effect pursuant to its
terms (except that Employee’s employment with the Company will no longer be “at
will,” but will instead be governed by this Agreement; and except that the
terms of Section 4 of that agreement will no longer apply and is instead
superseded by the terms of Section 4 of this Agreement).

 

2

 

2.4                                 Surrender
of Records and Property.  Promptly
after the end of the Full-Time Employment Period, Employee shall deliver to the
Company’s General Counsel all Company records and property possessed by
Employee, except that Employee may permanently keep Employee’s Blackberry and
laptop computer.

 

2.5                                 Part-Time
Employment With the Company. 
Throughout the Part-Time Employment Period, Employee shall be a
part-time employee of the Company, reporting to the New CEO, and available on a
part-time basis and compensated by the Part-Time Salary under Section 3.21
below.  Said part-time employment shall
include but not be limited to the following: 
(1) periodic and regular consultation with and advice to the New
CEO and/or other members of senior management of the Company; (2) sharing
of historical and learned knowledge and information regarding the Company; and (3) additional
duties to which Employee and the New CEO mutually agree (provided that if said
additional duties exceed the currently contemplated scope of Employee’s
part-time employment, then those additional duties or services will be subject
to Employee’s availability and at an additional hourly rate to be mutually
agreed to between Employee and the New CEO). 
The Company agrees that it shall use its reasonable efforts to continue
and maintain said part-time employment throughout the duration of the Part-Time
Employment Period, and, except pursuant to Sections 1.4(c) or (d), the
Company shall not take (or refuse to take) actions that deprive Employee of
continued part-time employment status during the Part-Time Employment
Period.  During the Part-Time Employment
Period, Employee shall not be required to incur any expenses for Company
business.  If the New CEO requests that
Employee travel or incur other expenses during the Part-Time Employment Period,
the Company shall reimburse Employee for those expenses.

 

2.6                                 Cooperation.  As a current or former executive officer of
the Company, during and after the end of the Employment Period, Employee agrees
to cooperate with the Company in the investigation, discovery and litigation of
any employment claims or other Company legal matters.  In consideration of such cooperation:  (1) the Company will reimburse Employee
for Employee’s reasonable out-of-pocket expenses incurred at the request of the
Company, (2) the Company will compensate Employee (as an independent
contractor if Employee is not employed by the Company at that time) for the
reasonable time incurred at the request of the Company, at a reasonable hourly
rate and (3) the Company will indemnify and defend Employee, in connection
with such cooperation, to the same extent as if Employee had continued to be an
employee and officer of the Company.

 

2.7                                 ADEA
Report.  Employee acknowledges that
concurrently with the signing of this Agreement, Employee has received a copy
of the ADEA report concerning the Company.

 

3.                                       Compensation,
Benefits and Severance.

 

3.1                                 Compensation
Through the End of the Full-Time Employment Period.  In accordance with the Company’s
normal payroll practices, from the Effective Date of this Agreement through the
end of the Full-Time Employment Period, the Company shall pay Employee Employee’s
current full-time base salary, less applicable taxes.

 

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3.2                                 ELRP
Bonus Plan.  If there any payouts
under the Company’s Executive Leadership Results Plan (“ELRP”) for the fiscal
year ended May 31, 2005 (“FY05”), Employee shall receive a payout (less
applicable taxes) to the full extent earned and accrued under the terms of the
ELRP for FY05 (the payout date will be governed by the ELRP).  If there are no payouts under the ELRP for
FY05, Employee will not receive any ELRP payouts or other bonuses for
FY05.  Employee will not be eligible to
receive any bonus or other incentive compensation for the fiscal years ending May 31,
2006, 2007 or 2008 (or for any fiscal quarter during those years) under the
ELRP or any other bonus plan or program.

 

3.3                                 Benefits.  Throughout the Full-Time Employment Period,
Employee shall continue to be eligible to receive the full-time benefits made
available by the Company to U.S. employees working full-time, including without
limitation the continued participation in the Company’s tax-qualified
retirement plan..  Employee shall not be
eligible to receive any benefits during the Part-Time Employment Period.

 

3.4                                 Initial
Release.  In consideration of the
severance payments to be made by the Company to Employee pursuant to Sections
3.5 and 3.6 below, at the end of the Full-Time Employment Period pursuant to
Sections 1.3(a) or (b) above, Employee will sign and deliver to the
Company the “Initial Release” in the form attached as Exhibit B.

 

3.5                                 Severance
Based On One Times Annual Base Salary. 
If the Full-Time Employment Period ends pursuant to Sections 1.3(a) or
(b) above, and Employee (or Employee’s estate or legal representative in
the case of Section 1.3(b)) has signed and delivered the Initial Release
to the Company (and not rescinded that release), then promptly after the 15-day
rescission period described in Section VII of the Initial Release, the
Company shall pay Employee $450,000.00, less applicable taxes (that $450,000
payment represents one times annual base salary and is in consideration of the
release described in Section II.A of the Initial Release).  The $450,000 payment described in this Section 3.5
will be paid in a lump sum (less applicable taxes) at the end of the first full
payroll period following the 15-day rescission period.

 

3.6                                 Severance
Based On One Times Annual Target Bonus. 
If the Full-Time Employment Period ends pursuant to Sections 1.3(a) or
(b) above, and Employee (or Employee’s estate or legal representative in the
case of Section 1.3(b)) has signed and delivered the Initial Release to
the Company (and not rescinded that release), then promptly after the 15-day
rescission period described in Section VII of the Initial Release, the
Company shall pay Employee $550,000.00, less applicable taxes (that $550,000
payment represents one times annual target bonus and is in consideration of the
release described in Section II.B of the Initial Release).  The $550,000 payment described in this Section 3.6
will be paid in a lump sum (less applicable taxes) at the end of the first full
payroll period following the 15-day rescission period.

 

3.7                                 No
Claw-Back for Other Employment. 
Employee shall not be obligated to payback any portion of the severance
payments made pursuant to Sections 3.5 or 3.6 above if Employee accepts
employment with another employer.

 

3.8                                 COBRA
Coverage.  Employee (and his
dependents) shall be eligible to and may elect COBRA continuation coverage
under the Company’s health plans

 

4

 

commencing
on the first day of the month following the end of the Full-Time Employment
Period (the “COBRA Start Date”).  The
Company shall pay the employer’s share (but not Employee’s share) of COBRA
medical and dental premiums for Employee and his dependents up to eighteen (18)
months after the COBRA Start Date if all of the following conditions are
met:  (1) Employee makes a timely
election for COBRA continuation, (2) the Full-Time Employment Period ends
pursuant to Sections 1.3(a) or (b) above; and (3) Employee has
signed and delivered the Initial Release to the Company (and not rescinded that
release).  Notwithstanding the foregoing,
nothing in this Agreement shall prejudice the rights. that Employee and his
dependents may have to elect and enjoy COBRA continuation coverage.

 

3.9                                 Outplacement Assistance.  Throughout the first twelve (12)
months after the end of the Full-Time Employment Period, the Company will make
available to Employee outplacement assistance valued at up to $25,000, using an
outplacement firm selected by Employee. 
The Company will use reasonable efforts to structure the outplacement
through the Company to minimize any adverse tax consequences to Employee on
that payment.  The outplacement payments
under this Section 3.9 are payable only to the extent that the actual
outplacement fees are actually incurred.

 

3.10                           Stock
Options.  The stock options
previously granted to Employee (“Options”) for the purchase of shares of common
stock of the Company, are governed by the terms of the applicable Stock
Incentive Plan and Grant Notice or Option Agreement delivered to Employee when
the Options were granted (collectively, the “Option Documents”).

 

(a)                                  No
Amendment of 1999/2000 Options.  The
Options granted to Employee on September 29, 1999 and March 9, 2000
at an exercise price of $2.2471 per share (the “1999/2000 Options”) are fully
vested and expire on the earlier of (i) ninety (90) days after the end of
the Employment Period (or one (1) year after Employee’s death or total disability),
or (ii) ten (10) years after grant. 
The terms of the 1999/2000 Options are not amended by this Agreement.

 

(b)                                 No
Further Vesting of 2002-05 Options After End of Full Time Employment
Period.  The term “2002-05
Options” collectively means all Options granted to Employee on or after July 15,
2002.  Notwithstanding any provision in
the Option Documents to the contrary:  (i) none
of the 2002-05 Options will vest after the end of the Full-Time
Employment Period and (ii) as of the close of business at the end of the
Full-Time Employment Period all unvested 2002-05 Options will be deemed
terminated and cancelled.

 

(c)                                  Amendment
of Under-Water 2002-05 Options.  
If the closing price of the Company’s common stock (Nasdaq symbol:  LWSN) on the trading day immediately
preceding the Effective Date of this Agreement is less than the respective
exercise price of any of the 2002-05 Options (those Options are
collectively referred to as the “Under-Water 2002-05 Options”), the
Under-Water 2002-05 Options are hereby amended as follows as of the
Effective Date:  notwithstanding any
provision in the Option Documents to the contrary, the Under-Water 2002-05
Options that are vested as of the end of the Full-Time Employment Period may be
exercised for two years after the end of the Full-

 

5

 

Time
Employment Period regardless of whether or not Employee is employed by the
Company.

 

(d)                                 Minimum
Period.  With respect to this Section 3.10
of this Agreement, and notwithstanding anything herein to the contrary, if at
any time during the Employment Period Employee’s status as an employee of the
Company (including but not limited to as a part-time employee) is determined to
be invalid by a governmental, judicial or other legal enforcement authority,
Employee shall have a minimum of ninety (90) days immediately following the
effective date of such determination in which to exercise those 1999/2000
Options and/or the 2002-05 Options (including without limitation the
Under-Water Options) which are vested and unexercised at that time.

 

(e)                                  No
Obligation to Notify.  The Company
and Salomon Smith Barney are not obligated to provide Employee future reminders
of these stock option dates.

 

3.11                           Non-Payment
of Severance, COBRA or Outplacement. 
Notwithstanding any provision in this Agreement to the contrary, if the
Full-Time Employment Period ends pursuant to Sections 1.3(c), (d) or (e) above,
then:  (1) no severance payments
shall be payable to Employee under Sections 3.5, 3.6 or 3.22 above, (2) no
COBRA payments shall be payable by the Company pursuant to Section 3.8
above, and (3) no outplacement payments shall be payable by the Company
pursuant to Section 3.9 above and (4) there shall be no Part-Time
Employment Period.  Notwithstanding the
foregoing, nothing in this Agreement shall prejudice the rights that Employee
and his dependents have to elect and enjoy COBRA continuation coverage.

 

3.12                           Insider
Trading Blackout.  Employee shall
continue to comply with the Company’s Insider Trading Policy until the end of
the Full-Time Employment Period. 
Employee is currently under a trading restriction for the Company’s
stock because of the pending Intentia Transaction (the “Intentia Transaction
Blackout”).  If at any time before the
Full-Time Employment Period ends, Employee possesses material nonpublic
information about the Company, Employee shall continue to comply with
applicable securities laws that restrict trading in Company stock based on that
information.

 

3.13                           No
Intentia Transaction Lockup.  The share
lockup in the Intentia Transaction does not apply to Employee.

 

3.14                           Form 4
and Form 144 Filings with SEC. 
If Employee has not made any non-exempt purchases of Company stock
during the six months before the end of the Full-Time Employment Period, no
further Form 4 filings will be required for Employee after the end of the
Full-Time Employment Period (other than as required by applicable law).During
the 90-days after the end of the Full-Time Employment Period, Employee
must file a Form 144 with the SEC for any sales of Company stock in
Employee’s 401(k) plan account.

 

3.15                           Flexible
Time Off (FTO).  All earned but
unused FTO through the end of the Full-Time Employment Period will be paid out
to Employee after the end of the

 

6

 

Full-Time
Employment Period, pursuant to the Company’s normal payroll practices.  No FTO shall accrue after the end of the
Full-Time Employment Period.

 

3.16                           Business
Expense Reimbursement.  The Company shall reimburse Employee for all
employment-related expenses, consistent with past practices, through the end of
the Full-Time Employment Period. 
Employee must submit the necessary requests for reimbursement within 30
days after the end of the Full-Time Employment Period, and through the end of
the Part-Time Employment Period, if such expenses are incurred in accordance
with Section 2.5.  Employee shall
not be obligated to reimburse the Company for any club memberships previously
paid for by the Company.

 

3.17                           Termination
of Umbrella Personal Liability Insurance Coverage.  The Company previously made
available to Employee, as an executive officer and director of the Company, $15
million of umbrella personal liability insurance.  That umbrella personal liability insurance
will be cancelled as of the end of the Full-Time Employment Period.  Notwithstanding the foregoing, nothing in
this Section 3.17 shall in any way limit the full benefit to Employee of Section 8
of this Agreement.

 

3.18                           Ayco
Personal Financial Planning Services. 
As CEO, Employee has received personal financial planning services from
Ayco at the Company’s expense (the “Ayco Services”).  The Company has paid the fees for the Ayco
Services through June 30, 2005 and will not seek a refund of those
fees.  The Company shall pay Ayco’s
expenses incurred before July 1, 2005. 
Employee shall pay any Ayco fees or expenses incurred after June 30,
2005 on behalf of Employee.

 

3.19                           Termination
of Employment Agreement.  The
Employment Agreement dated February 15, 2001 between the Company and
Employee is hereby terminated in its entirety and shall have no further force
or effect.

 

3.20                           No
Participation in Change in Control Severance Pay Plan.  On January 17, 2005, the Company adopted
the Executive Change in Control Severance Pay Plan for Tier 1 Executives (the “Tier
1 Plan”).  Under the Tier 1 Plan, if the
employment of a Tier 1 executive (e.g. the chief
executive officer and his or her direct reports) is terminated within two years
after a “Change in Control” of the Company (as defined in the Tier 1 Plan), the
Tier 1 executive may be eligible to receive as severance two times annual base
salary and two times the average annual bonus over the preceding three
years.  Employee acknowledges that this
Agreement supersedes the Tier 1 Plan and that if a Change in Control of the
Company occurs at any time, Employee will not be eligible for any payments
under the Tier 1 Plan.

 

3.21                           Compensation
During the Part-Time Employment Period. 
Throughout the Part-Time Employment Period, the Company shall pay
Employee a part-time salary of $1,000.00 per month, less applicable taxes, in
accordance with the Company’s normal payroll practices (the “Part-Time Salary”).

 

3.22                           Final
Release.  In consideration of the
$1,000 severance payment (less applicable taxes) to be made by the Company to
Employee pursuant to the “Final Release” in the form attached as Exhibit C,
at the end of the Part-Time Employment Period pursuant to Sections 1.4(a) or
(b) above (and after the end of the 15-day rescission

 

7

 

period
in Section VI of the Final Release), Employee will sign and deliver to the
Company the Final Release.

 

3.23                           No
Other Compensation or Payments. 
Except to the extent expressly set forth in this Agreement, Employee is
not eligible to receive at any time any compensation, severance or other
payments from the Company.  For example,
the compensation and severance arrangements between the Company and the New CEO
shall not in any way cause (or serve as a precedence for) the increase or
decrease in any amounts to be paid to Employee.

 

3.24                           Gross-Up
Payment.

 

(a) Anything in this Agreement to the contrary
notwithstanding, in the event it shall be determined that any payment or
distribution by the Company to or for the benefit of the Employee (whether paid
or payable or distributed or distributable pursuant to the terms of this
Agreement or otherwise, but determined without regard to any additional
payments required under this Section 3.24) (a “Payment”) would be subject
to the excise tax imposed by Section 4999 of the Internal Revenue Code of
1986, as amended (the “Code”) or any interest or penalties are incurred by the
Employee with respect to such excise tax (such excise tax, together with any
such interest and penalties, are hereinafter collectively referred to as the “Excise
Tax”), then the Employee shall be entitled to receive an additional payment (a “Gross-Up
Payment”) in an amount such that after payment by the Employee of all taxes
(including any interest or penalties imposed with respect to such taxes),
including, without limitation, any income taxes (and any interest and penalties
imposed with respect thereto) and Excise Tax imposed upon the Gross-Up Payment,
the Employee retains an amount of the Gross-Up Payment equal to the Excise Tax
imposed upon the Payment.

 

(b) All determinations required to be made under this Section 3.24,
including whether and when a Gross-Up Payment is required and the amount of
such Gross-Up Payment and the assumptions to be utilized in arriving at such
determination, shall be made by the Accounting Firm which shall provide
detailed supporting calculations both to the Company and the Employee within 15
business days after the receipt of notice from the Employee that there has been
a Payment, or such earlier time as is requested by the Company.  The determination of tax liability made by
the Accounting Firm shall be subject to review by the Employee’s tax advisor,
and, if the Employee’s tax advisor does not agree with the determination
reached by the Accounting Firm, then the Accounting Firm and the Employee’s tax
advisor shall jointly designate a nationally recognized public accounting firm
which shall make the determination.  All
fees and expenses of the accountants and tax advisors retained by both the
Employee and the Company shall be borne solely by the Company.  Any Gross-Up Payment, as determined pursuant
to this Section 3.24, shall be paid by the Company to the Employee within
five days after the receipt of the determination.  Any determination by such jointly designated
public accounting firm shall be binding upon the Company and the Employee.  As a result of the uncertainty in the
application of Section 4999 of the Code at the time of the initial
determination hereunder, it is possible that a Gross-Up Payment will not have
been made by the Company that should have been made (an “Underpayment”),
consistent with the calculations required to be made hereunder.  In the event that the Employee hereafter is
required to make a payment of any Excise Tax, any such

 

8

 

Underpayment shall be promptly paid by the Company to or for the
benefit of the Employee.  Upon notice by
the Employee of any audit or other proceeding that may result in a liability to
the Company hereunder, the Employee shall promptly notify the Company of such
audit or other proceeding; and the Company may, at its option, but solely with
respect to the item or items that relate to such potential liability, choose to
assume the defense of such audit or other proceeding at its own cost, provided
that (i) the Employee shall cooperate with the Company in such defense and
(ii) the Company will not settle such audit or other proceeding without
the consent of the Employee (such consent not to be unreasonably
withheld).  The highest effective
marginal tax rate (determined by taking into account any reduction in itemized
deductions and/or exemptions attributable to the inclusion of the additional
amounts payable under this Section 3.24 in the Employee’s adjusted gross
or taxable income) based upon the state and locality where the Employee is
resident at the time of payment of such amounts will be used for purposes of
determining the federal and state income and other taxes with respect thereto.

 

4.                                       Covenant Not To Compete, Hire or Solicit. 
In consideration of the severance payments under Sections 3.5 and 3.6
above, Employee covenants and agrees that from the date of this Agreement
through and ending one year after the end of the Full-Time Employment Period,
Employee shall not:

 

(a)                                  be employed by SAP AG, Microsoft
Corporation, Oracle Corporation, SSA Global Technologies, Inc., McKesson
Corporation, American Management Systems, Inc., Epicor Software
Corporation or Intentia International AB (unless employed pursuant to this
Agreement) or any of their respective subsidiaries (collectively referred to as
the “Named Competitors”);

 

(b)                                 directly
solicit any Company clients who are clients as of the Effective Date of this
Agreement for the purpose of selling or providing those clients any products or
services which directly compete with the Company’s products or services; or

 

(c)                                  directly
solicit any Company employees for the purpose of hiring them and inducing them
to leave employment at the Company.

 

If one or more of the Named Competitors acquire one another, this Section 4
shall remain in effect pursuant to its terms for each of the resulting
successors to the Named Competitors.  If
a Named Competitor acquires Employee’s then current employer, that acquisition
will not result in a violation of this Section 4 (e.g.,
Employee may continue to work for that employer or its successor).  If another company (that is not a Named
Competitor) buys one of the Named Competitors, that acquisition will not
prohibit Employee from working for the combined company.  Employee acknowledges that the violation of
this Section 4 will cause irreparable harm to the Company and agrees that,
in addition to any other relief afforded by law, an injunction against any
violation of this Section 4 may issue against Employee.  Both damages and injunction shall be proper
modes of relief and are not alternative remedies for Employee’s violation of
this Section 4.  If the Company
commences any action in equity to specifically enforce any of its rights under
this Section 4, Employee waives and agrees not to assert the defense that
the Company has an adequate remedy at law.

 

9

 

5.                                       Publicity.  The Company and Employee will mutually agree
to the content of any press releases or other public statements from the
Company concerning the resignation of Employee. 
Employee acknowledges that the Company is required to disclose the
contents of this Agreement publicly with the Securities and Exchange Commission
in a Form 8-K Report, which may include a copy of this Agreement.

 

6.                                       Non-disparagement.  Employee agrees not to make any disparaging
remarks, either orally or in writing, regarding the Company or any of its
officers or directors.  The Company
agrees that no executive officer of the Company has authorized or will
authorize any employee to make any disparaging remarks, either orally or in
writing, regarding Employee.  Both the
Company and the Employee acknowledge that this provision shall not prevent the
Employee or any Company representative from providing truthful testimony in any
deposition or proceeding.

 

7.                                       Indemnification
by the Company.  To the extent
allowed under Section 145 of the Delaware General Corporation Law (which
requires that Employee acted in good faith and in a manner Employee reasonably
believed to be in or not opposed to the best interests of the Company),  and until the last expiration date of the
applicable statute of limitations, the Company shall indemnify and defend
Employee against any claims or other actions brought against Employee in
connection with Employee’s present, past, or future (including part-time)
employment by the Company or status as a current or former executive officer or
director, or employee, of the Company (a “Claim”), including but not limited to
any civil or criminal claims against Employee relating to his part-time
employment or part-time status, as well as the impact of said part-time
employment or status on the consideration given to Employee under this Agreement,
subject to each of the following:

 

(a)                                  Employee
promptly notifies the Company of the Claim.

 

(b)                                 The Company
will provide Employee legal representation by lawyer(s) and a law firm selected
by the Company.  If joint representation
is not applicable or appropriate, the Company will provide and pay for separate
legal counsel to represent Employee, subject to Employee’s continued compliance
with Section 2.6 above and this Section 7.

 

(c)                                  Employee
will not agree to any settlements, for which the Company is obligated to
indemnify Employee, unless the Company has agreed to that settlement in writing
and in advance.

 

8.                                       D&O
Insurance.  Until the last expiration
date of the applicable statute of limitations, the Company (and its successors)
shall renew, purchase and/or maintain in effect, at the Company’s expense,
directors and officers liability insurance, with carriers and coverages that
are reasonably comparable to the Company’s current coverage, to the extent
commercially and reasonably available in the market (the “D&O Insurance”).  The D&O Insurance shall cover Employee as
a current or former executive officer and director of the Company, subject to
the insurance policy scope and limitations. 
From time to time upon written request from Employee to the attention of
the Company’s Corporate Secretary, the Company shall provide Employee evidence
of the D&O Insurance then in effect (as well as copies of the D&O
Insurance in effect and covering Employee at any time during his employment
with the Company).

 

10

 

9.                                       Limitation
of Liability.  Except for the Company’s
obligations under Sections 2.6, 7 and 8 above, the Company shall not be
obligated to pay any amounts to Employee in excess of the amounts described in Section 3
above.  In no event shall the Company or
Employee be liable to each other for any indirect, special, consequential or
punitive damages.

 

10.                                 Release
by the Company.  Except only for
criminal conduct or violations of the federal securities laws (other than such
conduct in which Employee was directed to engage by a director, officer, or
someone superior to Employee within the Company), upon the end of the 15-day
rescission period in the Initial Release, the Company will be deemed to have
released and forever discharged Employee from any and all claims or causes of
action of any type, both known or unknown, asserted and unasserted, direct and
indirect, and of any kind, nature, or description whatsoever, under any local,
state, or federal law(s), or the common law of any state arising or which may
have arisen at any time prior to the end of the Full-Time Employment Period
pursuant to Sections 1.3(a) or (b) above.  This Section 10 shall automatically
become null and void if Employee rescinds the Initial Release.

 

11.                                 General.

 

11.1                           Governing
Law.  This Agreement is made under
and shall be governed by and construed in accordance with the laws of the State
of Minnesota without regard to conflicts of laws principles.

 

11.2                           Entire
Agreement.  This Agreement and any
other agreement specifically mentioned in this Agreement contains the entire
agreement of the parties relating to the employment of Employee by the Company
and the other matters discussed herein and supersedes all prior promises,
contracts, agreements and understandings of any kind (other than any other
written agreement mentioned herein), whether express or implied, oral or
written, with respect to such subject matter.

 

11.3                           Withholding
Taxes.  The Company may take such
action as it deems appropriate to insure that all applicable federal, state,
city and other payroll, withholding, income or other taxes (“Taxes”) arising
from any compensation, benefits or any other payments made pursuant to this
Agreement, or any other contract, agreement or understanding which relates, in
whole or in part, to Employee’s employment with the Company, are withheld or
collected from Employee.   The Company
shall have no obligation to pay any Taxes on behalf of Employee or reimburse
Employee for the payment of any Taxes.

 

11.4                           Amendments.  No amendment or modification of this
Agreement shall be deemed effective unless made in writing and signed by
Employee and an executive officer or director authorized by the Board of
Directors of the Company.

 

11.5                           No
Waiver.  No term or condition of this
Agreement shall be deemed to have been waived, nor shall there be any estoppel
to enforce any provisions of this Agreement, except by a statement in writing
signed by the party against whom enforcement of the waiver or estoppel is
sought.

 

11.6                           Assignment.  This Agreement may not be assigned by either
party unless the other party consents in writing, except that the Company may
assign this Agreement

 

11

 

without
Employee’s consent in connection with a merger or sale of the Company or sale
of substantially all of the assets of the Company or its applicable operating
division.

 

11.7                           Review
by Employee’s Legal Counsel.  The
Company has informed Employee that Employee has the right to consult with an
attorney and tax advisor (at Employee’s own expense) before signing this
Agreement.  The Company is not obligated
to reimburse Employee for any legal fees incurred in the review, negotiation or
preparation of this Agreement.

 

IN
WITNESS WHEREOF, the parties have executed this Agreement effective as of the
date set forth in the first paragraph of this Agreement.

 

	
   

  	
  Lawson Software, Inc.

  
	
   

  	
   

  
	
   

  	
  By

  	
  /s/ H. Richard
  Lawson

  
	
   

  	
   

  	
  H. Richard Lawson,

  
	
   

  	
   

  	
  Chairman

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Employee Name:
  John J. Coughlan

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ John J.
  Coughlan

  
	
   

  	
  Employee
  Signature

  

 

12

 

EXHIBIT A

 

LAWSON SOFTWARE, INC.

EMPLOYEE INVENTION AND NON-DISCLOSURE AGREEMENT

 

In consideration of the
benefits of my at-will employment with LAWSON SOFTWARE, INC, , or any of its
subsidiaries,  (hereinafter “COMPANY”),
including wage or salary, fringe benefits, present or possible future job
promotions, salary increases and bonuses, I, the Employee (hereinafter “I” or “me”),
agree as follows:

 

1. NON-DISCLOSURE OF CONFIDENTIAL INFORMATION.  I agree that Confidential Information
related to COMPANY’s business, or the business of any of its clients,
customers, suppliers, partners or third parties, I acquire during my employment
by COMPANY is the property of COMPANY or is held in trust by COMPANY, will be
held in trust by me, and shall be regarded and treated as confidential and
solely for the benefit of COMPANY. Such “Confidential Information” for purpose
of this Agreement shall mean all information maintained in confidence by COMPANY.  Confidential Information includes, but is not
limited to:  (1) all information
that derives independent economic value, actual or potential, from not being
generally known to, and not being readily ascertainable through proper means
by, other persons who can derive economic value from its disclosure or use, (2) trade
secrets and (3) computer programs and passwords; customer lists, sales
lists and supplier lists; pricing, licenses, costs, budgets, financial
information and financing plans; marketing and sales statistics and studies;
projections, strategies, forecasts, new products and marketing and business
plans; merger and acquisition plans; formulas, processes, data procedures,
techniques and improvements; inventions, product designs, discoveries and
developments; and employee data, files and compensation.  Such information may be marked as
confidential or proprietary, or received under circumstances reasonably
interpreted as imposing an obligation of confidentiality.  Such information does not lose its status as
Confidential Information merely because it was known by a limited number of
persons or entities or because it was not entirely originated by COMPANY.  I acknowledge that the Confidential
Information of COMPANY is a valuable, special and unique asset of COMPANY, and
that any disclosure of such Confidential Information may be materially damaging
to COMPANY.  The obligation of confidence
under this Agreement shall not apply to any portion of information which I can
show from documented records is or becomes generally available to the public
without fault of mine, or which is obtained without restriction on publication
or use from a third party having the right to disclose the same.

 

I agree that I shall not,
except as necessary in the course of conducting business for COMPANY, use such
Confidential Information myself or disclose such information to any other
person or entity, directly or indirectly, either during my employment or at any
time thereafter, without the prior written consent of COMPANY.  I agree that I shall not remove any records,
documents, or other Confidential Information from the premise of COMPANY in
either original, duplicate or copied form, except as necessary in the course of
conducting business for COMPANY.  I agree
to return to COMPANY all Confidential Information in my possession, including
duplicates and copies, upon request by COMPANY, or at the time my employment is
terminated.

 

2. INVENTIONS AND PROPRIETARY INFORMATION.   I represent to COMPANY that I am not a party
to any other agreement that conflicts with this Agreement or which would
restrict or prevent me from performing my duties as an employee of
COMPANY.  I agree that I will promptly
disclose to and immediately assign and transfer to COMPANY in

 

13

 

writing all my right,
title, and interest in all inventions, works of authorship, improvement,
designs, developments, and discoveries created by me individually or with
others that relate in any manner to the present or prospective business or
research of COMPANY.

 

“Inventions”
means discoveries, concepts, and ideas, whether patentable or not, relating to
any present or prospective product, service, business, research or development
of COMPANY.  Works of authorship means
all forms of original expression fixed in any tangible medium.  Examples of works of authorship include,
without limitation, programs, programming tools and designs, program
documentation, training materials, marketing materials and business plans.

 

At
COMPANY’s request, I will sign all papers COMPANY considers necessary or
advisable to patent any invention or improvement or to register any copyright,
trademark or domain name, each in the name of COMPANY.  I agree to take these steps both during and
after my employment with COMPANY.

 

The
provisions of this Section 2 do not apply to created works for which no
equipment, supplies, facility or trade secret information of COMPANY was used
and which were developed entirely on my own time, and (a) which do not
relate (1) directly to the business of COMPANY, or (2) to COMPANY’s
actual or demonstrably anticipated research or development, or (b) which
do not result from any work performed by me for COMPANY.

 

3.  DOCUMENTS AND TANGIBLE
PROPERTY.  All documents
and other tangible property relating in any way to the business of COMPANY
which are conceived or generated by me or come into my possession during my
employment shall be and remain the exclusive property of COMPANY, and I agree
to return all such documents and tangible property to COMPANY upon any
separation from my employment at COMPANY.

 

Additionally,
I agree that I do not have, nor have I ever had, claim of any right title or
interest in any trademarks, trade names or domain names owned or used by
COMPANY.

 

4.  NON-SOLICITATION.  I will not, during the term of my employment
and for a period of 12 months following the termination of my employment,
directly or indirectly, hire or solicit any COMPANY employees for the purpose
of hiring them or inducing them to leave employment at COMPANY.  [THIS SECTION 4
OF THIS EXHIBIT B WILL NO LONGER APPLY AND IS INSTEAD SUPERSEDED BY SECTION 4
OF THE SEPARATE, WRITTEN SEPARATION AND NON-COMPETE AGREEMENT AND MUTUAL
RELEASE, TO WHICH THIS EXHIBIT B IS ATTACHED.]

 

5. REMEDIES.  Since any violation of this Agreement by me
would result in immediate and irreparable injury to COMPANY, I agree that
COMPANY will have the right to obtain an injunction to specifically enforce the
terms of this Agreement, and to obtain any other legal or equitable remedies
which may be available pursuant to this Agreement and/or applicable law.  In the event of any violation by me of this
Agreement, I agree to pay the reasonable costs and attorneys’ fees which
COMPANY incurs in pursuing any of its rights with respect to this Agreement, in
addition to the damages sustained by COMPANY.

 

6. SEVERABILITY.  If a court of competent jurisdiction finds
any provision of this Agreement to be unenforceable, the remaining provisions
will continue to be binding.  Such a

 

14

 

court shall also have the
authority to modify any clause solely in order to render the provision valid
under applicable law.

 

7. SUCCESSORS AND ASSIGNS.  I agree that this Agreement shall be binding
on my heirs, assigns, and legal representatives and may be transferred by
COMPANY to its successors and assigns.

 

8. GOVERNING LAW.  This Agreement shall be governed by the laws
of the State of Minnesota.  The venue for
any legal action shall be the United States District Court in St. Paul,
Minnesota.

 

I HAVE SATISFIED MYSELF
FULLY AS TO THE NATURE OF THE OBLIGATIONS CONTAINED HEREIN AND HAVE SIGNED THIS
AGREEMENT VOLUNTARILY.

 

15

 

Exhibit B

 

General Release and Agreement

(“Initial Release” to be signed at end of Full-Time Employment Period )

 

This
General Release and Agreement (“General Release and Agreement”) is made and
entered into as of                       ,
2005 between Lawson Software, Inc. (“the Company”) and John J. Coughlan (“Employee”).

 

WHEREAS, the Company and Employee are parties to
a Separation and Noncompete Agreement and Mutual Release dated effective as of June 2,
2005  (the “Agreement”);

 

WHEREAS, Employee intends to release any and all
claims that Employee has or may
have against the Company as a result of Employee’s employment with the Company;
and

 

WHEREAS, under the terms of the Agreement, which
Employee agrees are fair and reasonable, Employee agreed to enter into this
General Release and Agreement as a condition precedent to the payments
described in Sections 3.5 and 3.6 of the Agreement.

 

NOW, THEREFORE, in consideration of the
provisions and the mutual covenants herein contained, the parties agree as
follows:

 

I.                                         SEVERANCE
BENEFITS.

 

A.                                    The
Company agrees to pay Employee $450,000.00 (less applicable taxes), out of the
payment described in Section 3.5 of the Agreement, in consideration of the
release set forth in Section II(A) below.

 

B.                                    The
Company agrees to pay Employee the remaining $550,000.00 (less applicable
taxes) out of the payment described in Section 3.6 of the Agreement in
consideration of the release set forth in Section II(B) below.

 

II.                                     RELEASE
OF CLAIMS (“Release”).  The following
Release does not apply to the Company’s obligations to Employee as described
and contained in the Agreement.

 

A.                                    In
consideration of the benefits listed in Section I(A) above, Employee,
on behalf of himself, his heirs, executors, family members, beneficiaries,
assignees, administrators, successors, and executors or anyone acting or
claiming to act on his behalf, hereby releases and forever discharges, in full
and final settlement, Lawson Software, Inc. and its predecessor the Lawson
Associates, Inc. and all of their respective divisions, parent,
subsidiaries, predecessors and successors, and all affiliated organizations,
companies, foundations, and other corporations as well as past and present
employees, agents, officials, officers, directors, and representatives, both
individually and in their representative capacities, from any and all claims or
causes of action of any type, both known or unknown, asserted and unasserted,
direct and indirect, and of any kind, nature, or description whatsoever, under
any local, state, or federal law(s), or the common law of the State of
Minnesota, arising or which may have arisen at any time prior to the date of
this General Release and Agreement.  This
Release includes, but is not limited to, any and all claims arising from
Employee’s employment with the Company or any business entity related to or
acting on behalf of the Company, including claims arising under the Minnesota
Human

 

16

 

Rights Act, Minnesota Law
Against Discrimination, Title VII of the 1964 Civil Rights Act, as amended, the
Americans with Disabilities Act, the Federal and State of Minnesota Fair Labor
Standards Acts, the Employee Retirement Income Security Act, and any other
local, state, or federal law(s) relating to illegal discrimination in the
workplace on the basis of race, religion, disability, sex, age, or other
characteristics of traits, as well as any claims that Employee may have been
wrongfully discharged, that a employment contract has been breached, that
Employee has been harassed or otherwise treated unfairly during his employment,
or that he has been defamed in any fashion. 
This Release also includes any claims based upon (a) the value of
stock options that have not vested or are unexercisable after the date of
termination of Employee’s employment with the Company pursuant to the
applicable stock option agreements, grant notices or stock option plans, and (b) the
value of stock options previously granted to Employee and that have vested and
are exercisable as of the date of termination of Employee’s employment with the
Company, but that Employee elects not to exercise and pay for within the
applicable period after the date of termination of Employee’s employment with
the Company pursuant to the express terms of the applicable stock option
agreements, grant notices or stock option plans.   This Release also includes any claims for
libel or slander, claims for assault or battery, claims for infliction of
emotional distress whether intentional or negligent, claims of negligence
(including negligent hiring, negligent supervision, and negligent retention),
or any and all other claims arising out of Employee’s employment relationship
with the Company.  This Release also
includes any claims for attorney’s fees that Employee has or may have had for
any claim identified above.  Employee
acknowledges that the severance benefits set forth in Section I(A) above
constitute adequate consideration for this Release.

 

B.                                    In
consideration of the benefits listed in Section I(B) above, Employee
hereby releases and forever discharges the Company and all of their respective
divisions, parent, subsidiaries, predecessors and successors, and all
affiliated organizations, companies, foundations, and other corporations, as
well as past and present employees, agents, officials, officers, directors, and
representatives, both individually and in their representative capacities, from
any and all claims or causes of action of any type, both known and unknown,
arising under or relating to the Age Discrimination in Employment Act, as amended.

 

III.                                 NON-ADMISSION.

 

It is
understood and agreed that this General Release and Agreement does not
constitute an admission by the Company of any liability, wrongdoing, or
violation of any law.  Further, the
Company expressly denies any wrongdoing of any kind whatsoever in its actions
and dealings with Employee.  Employee
acknowledges and agrees that the Company has no obligation to hire or employ
Employee in the future.

 

IV.           OPPORTUNITY TO SEEK
ADVICE AND CONFIRMATION OF UNDERSTANDING.

 

Employee
acknowledges that Employee received this General Release and Agreement on                         ,2005.  Employee has been informed by the Company
that Employee has the right to consult with an attorney (at Employee’s own
expense) before signing this General Release and Agreement, and that Employee
has twenty-one (21) days after the date on which Employee

 

17

 

received this General
Release and Agreement to consider whether or not Employee wishes to sign it.

 

Employee
acknowledges that Employee has read and understands this entire General Release
and Agreement, and has had sufficient opportunity to ask the Company any
questions about this General Release and Agreement.  If Employee has asked the Company any
questions about this General Release and Agreement, all questions have been
answered and Employee understands and is satisfied with all of those answers.

 

V.            OPPORTUNITY
TO CONSIDER.

 

Employee
understands that Employee may cancel this General Release and Agreement for any
reason within fifteen (15) days after Employee has signed it.  If Employee decides to cancel this General
Release and Agreement, Employee must provide written notice of cancellation,
and that notice must be addressed to General Counsel, Lawson Software, Inc.,
380 St. Peter Street, St. Paul, Minnesota 55102.  The notice must be hand-delivered or sent by
certified mail, return receipt requested, and postmarked within the 15-day
period.

 

VI.           COMPREHENSIVE
NATURE OF AGREEMENT.

 

The
Agreement, the exhibits to the Agreement, existing written stock option
agreements and options plans, the Lawson Software, Inc. Employee Invention
and Non-Disclosure Agreement and this General Release and Agreement contain the
entire agreement between the Company and Employee.  No other agreements, except the employee
benefit plans in which Employee participated, are in full force and effect.  Employee
acknowledges that Employee has been advised in writing to consult Employee’s
own attorney, and that Employee has had an opportunity to be represented by
Employee’s own attorney, and that Employee has read and understands the terms
of this General Release and Agreement, and that Employee is voluntarily
entering this General Release and Agreement to take advantage of the benefits
offered, and that there have been no promises leading to the signing of this
General Release and Agreement except those that have been expressly contained
in this written document.

 

VII.         NON-ASSIGNMENT.

 

Employee
and the Company agree that this General Release and Agreement may not be
assigned by either party unless the other party consents in writing, except
that the Company may assign this General Release and Agreement without Employee’s
consent in connection with a merger or sale of the Company or sale of substantially
all of the assets of the Company or its applicable operating division.

 

VIII.        SAVINGS
CLAUSE.

 

If any
provision of this General Release and Agreement is determined later to be
unenforceable or illegal, the remaining provisions shall remain in full force
and effect.

 

IX.           EMPLOYER’S
REMEDIES.

 

Employee
acknowledges that the violation of any of the terms of this General Release and
Agreement will cause irreparable harm to the Company and agrees that, in
addition to any

 

18

 

other relief afforded by law, an injunction against the violation of
the General Release and Agreement may issue against Employee.  Both damages and injunction shall be proper
modes of relief and are not alternative remedies.  If the Company commences any action in equity
to specifically enforce any of its rights under this General Release and
Agreement, Employee waives and agrees not to assert the defense that the
Company has an adequate remedy at law.

 

X.            GOVERNING
LAW.

 

This
General Release and Agreement will be construed and interpreted in accordance
with the laws of the State of Minnesota. 
The parties to this General Release and Agreement

 

19

 

agree and acknowledge
that this General Release and Agreement shall be considered to have been
drafted equally by each of the parties.

 

	
   

  	
  LAWSON SOFTWARE,
  INC.

  
	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Its:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
  Employee Name:
  John J. Coughlan

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Employee Signature

  
						

 

20

 

Exhibit C

 

General Release and Agreement

(“Final Release” to be signed at end of Part-Time Employment Period )

 

This
General Release and Agreement (“General Release and Agreement”) is made and
entered into as of                       ,
200   between Lawson Software, Inc. (“the Company”) and John J.
Coughlan (“Employee”).

 

WHEREAS, the Company and Employee are parties to
a Separation and Noncompete Agreement and Mutual Release dated effective as of June 2,
2005  (the “Agreement”);

 

WHEREAS, Employee intends to release any and all
claims that Employee has or may
have against the Company as a result of Employee’s employment with the Company;
and

 

WHEREAS, under the terms of the Agreement, which
Employee agrees are fair and reasonable, Employee agreed to enter into this
General Release and Agreement as a condition precedent to the payment described
in Section 3.22 of the Agreement.

 

NOW, THEREFORE, in consideration of the
provisions and the mutual covenants herein contained, the parties agree as
follows:

 

I.              SEVERANCE
BENEFITS.

 

A.                                    The
Company agrees to pay Employee $500.00 (less applicable taxes), out of the
payment described in Section 3.22 of the Agreement, in consideration of
the release set forth in Section II(A) below.

 

B.                                    The
Company agrees to pay Employee the remaining $500.00 (less applicable taxes)
out of the payment described in Section 3.22 of the Agreement in
consideration of the release set forth in Section II(B) below.

 

II.            RELEASE
OF CLAIMS (“Release”).  The following
Release does not apply to the Company’s obligations to the extent described
under the Agreement.

 

A.                                    In
consideration of the benefits listed in Section I(A) above, Employee,
on behalf of himself, his heirs, executors, family members, beneficiaries,
assignees, administrators, successors, and executors or anyone acting or
claiming to act on his behalf, hereby releases and forever discharges, in full
and final settlement, Lawson Software, Inc. and its predecessor the Lawson
Associates, Inc. and all of their respective divisions, parent,
subsidiaries, predecessors and successors, and all affiliated organizations,
companies, foundations, and other corporations as well as past and present
employees, agents, officials, officers, directors, and representatives, both
individually and in their representative capacities, from any and all claims or
causes of action of any type, both known or unknown, asserted and unasserted,
direct and indirect, and of any kind, nature, or description whatsoever, under
any local, state, or federal law(s), or the common law of the State of
Minnesota, arising or which may have arisen at any time prior to the date of
this General Release and Agreement.  This
Release includes, but is not limited to, any and all claims arising from
Employee’s employment with the Company or any business entity related to or
acting on behalf of the Company, including claims arising under the Minnesota
Human

 

21

 

Rights Act, Minnesota Law
Against Discrimination, Title VII of the 1964 Civil Rights Act, as amended, the
Americans with Disabilities Act, the Federal and State of Minnesota Fair Labor
Standards Acts, the Employee Retirement Income Security Act, and any other
local, state, or federal law(s) relating to illegal discrimination in the
workplace on the basis of race, religion, disability, sex, age, or other
characteristics of traits, as well as any claims that Employee may have been
wrongfully discharged, that a employment contract has been breached, that
Employee has been harassed or otherwise treated unfairly during his employment,
or that he has been defamed in any fashion. 
This Release also includes any claims based upon (a) the value of
stock options that have not vested or are unexercisable after the date of
termination of Employee’s employment with the Company pursuant to the
applicable stock option agreements, grant notices or stock option plans, and (b) the
value of stock options previously granted to Employee and that have vested and
are exercisable as of the date of termination of Employee’s employment with the
Company, but that Employee elects not to exercise and pay for within the
applicable period after the date of termination of Employee’s employment with
the Company pursuant to the express terms of the applicable stock option
agreements, grant notices or stock option plans.   This Release also includes any claims for
libel or slander, claims for assault or battery, claims for infliction of
emotional distress whether intentional or negligent, claims of negligence
(including negligent hiring, negligent supervision, and negligent retention),
or any and all other claims arising out of Employee’s employment relationship
with the Company.  This Release also
includes any claims for attorney’s fees that Employee has or may have had for
any claim identified above.  Employee
acknowledges that the severance benefits set forth in Section I(A) above
constitute adequate consideration for this Release.

 

B.                                    In
consideration of the benefits listed in Section I(B) above, Employee
hereby releases and forever discharges the Company and all of their respective
divisions, parent, subsidiaries, predecessors and successors, and all
affiliated organizations, companies, foundations, and other corporations, as
well as past and present employees, agents, officials, officers, directors, and
representatives, both individually and in their representative capacities, from
any and all claims or causes of action of any type, both known and unknown,
arising under or relating to the Age Discrimination in Employment Act, as
amended.

 

III.           NON-ADMISSION.

 

It is
understood and agreed that this General Release and Agreement does not
constitute an admission by the Company of any liability, wrongdoing, or
violation of any law.  Further, the
Company expressly denies any wrongdoing of any kind whatsoever in its actions
and dealings with Employee.  Employee
acknowledges and agrees that the Company has no obligation to hire or employ
Employee in the future.

 

IV.           OPPORTUNITY
TO SEEK ADVICE AND CONFIRMATION OF UNDERSTANDING.

 

Employee
acknowledges that Employee received this General Release and Agreement on                         ,
200  .  Employee has been
informed by the Company that Employee has the right to consult with an attorney
(at Employee’s own expense) before signing this General Release and Agreement,
and that Employee has 21 days after the date on which Employee received this
General Release and Agreement to consider whether or not Employee wishes to
sign it.

 

22

 

Employee
acknowledges that Employee has read and understands this entire General Release
and Agreement, and has had sufficient opportunity to ask the Company any
questions about this General Release and Agreement.  If Employee has asked the Company any
questions about this General Release and Agreement, all questions have been
answered and Employee understands and is satisfied with all of those answers.

 

V.            OPPORTUNITY
TO CONSIDER.

 

Employee
understands that Employee may cancel this General Release and Agreement for any
reason within fifteen (15) days after Employee has signed it.  If Employee decides to cancel this General
Release and Agreement, Employee must provide written notice of cancellation,
and that notice must be addressed to General Counsel, Lawson Software, Inc.
, 380 St. Peter Street, St. Paul, Minnesota 55102.  The notice must be hand-delivered or sent by
certified mail, return receipt requested, and postmarked within the 15-day
period.

 

VI.           COMPREHENSIVE
NATURE OF AGREEMENT.

 

The
Agreement, the exhibits to the Agreement, existing written stock option
agreements and options plans, the Lawson Software, Inc. Employee Invention
and Non-Disclosure Agreement and this General Release and Agreement contain the
entire agreement between the Company and Employee.  No other agreements, except the employee
benefit plans in which Employee participated, are in full force and effect.  Employee
acknowledges that Employee has been advised in writing to consult Employee’s
own attorney, and that Employee has had an opportunity to be represented by
Employee’s own attorney, and that Employee has read and understands the terms
of this General Release and Agreement, and that Employee is voluntarily
entering this General Release and Agreement to take advantage of the benefits
offered, and that there have been no promises leading to the signing of this
General Release and Agreement except those that have been expressly contained
in this written document.

 

VII.         NON-ASSIGNMENT.

 

Employee
and the Company agree that this General Release and Agreement may not be
assigned by either party unless the other party consents in writing, except
that the Company may assign this General Release and Agreement without Employee’s
consent in connection with a merger or sale of the Company or sale of
substantially all of the assets of the Company or its applicable operating
division.

 

VIII.        SAVINGS
CLAUSE.

 

If any
provision of this General Release and Agreement is determined later to be
unenforceable or illegal, the remaining provisions shall remain in full force
and effect.

 

IX.           EMPLOYER’S
REMEDIES.

 

Employee
acknowledges that the violation of any of the terms of this General Release and
Agreement will cause irreparable harm to the Company and agrees that, in addition
to any other relief afforded by law, an injunction against the violation of the
General Release and Agreement may issue against Employee.  Both damages and injunction shall be proper
modes of

 

23

 

relief and are not alternative remedies.  If the Company commences any action in equity
to specifically enforce any of its rights under this General Release and
Agreement, Employee waives and agrees not to assert the defense that the
Company has an adequate remedy at law.

 

X.            GOVERNING
LAW.

 

This
General Release and Agreement will be construed and interpreted in accordance
with the laws of the State of Minnesota. 
The parties to this General Release and Agreement

 

24

 

agree and acknowledge
that this General Release and Agreement shall be considered to have been
drafted equally by each of the parties.

 

 

	
   

  	
  LAWSON SOFTWARE,
  INC.

  
	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
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  Its:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
  Employee Name:
  John J. Coughlan

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Employee Signature

  
						

 

25Exhibit 10.5

 

EMPLOYMENT AGREEMENT

 

This
Employment Agreement (“Agreement”)
is made and entered into effective as of the Agreement Date, between Lawson
Software, Inc., a Delaware corporation, having its principal place of
business in St. Paul, Minnesota and Harry Debes (“Employee”), for the purpose of setting forth the terms and
conditions of Employee’s employment by the Company

 

Recitals

 

WHEREAS, the Company desires to employ Employee as described in this
Agreement, and Employee desires to accept and serve in that capacity; and

 

WHEREAS, Employee understands that such employment is expressly conditioned on
execution of this Agreement; and

 

WHEREAS, Company desires to employ Employee to render services for Company on
the terms and conditions set forth in this Agreement, and Employee desires to
be retained and employed by Company pursuant to such terms and conditions.

 

Agreement

 

NOW, THEREFORE, in consideration of Employee’s employment with Company and the
foregoing premises, the mutual covenants set forth below and other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, Company and Employee agree as follows:

 

Article I. 
Definitions

 

1.1           “Agreement”
means this Employment Agreement, as from time to time amended.

 

1.2           “Agreement
Date” means the date on which the Company publicly announces the
proposed Lawson/Intentia Transaction.

 

1.3           “Base
Salary” means the total annual cash compensation payable on a
regular periodic basis, without regard to taxes and other items withheld, and
excluding all types of incentive pay, all forms of stock or equity based
compensation, fringe benefits, special pay or awards, commissions and
bonuses.  Base Salary shall include
amounts contributed by Employee to a qualified retirement plan, nonqualified
deferred compensation plan or similar plan sponsored by the Company, but it
shall not include earnings on those amounts.

 

1.4           “Board”
means the Board of Directors of Company.

 

1.5           “Cause” means: 
(1) material breach by Employee of this Agreement or the Invention
and Non-Disclosure Agreement; (2) any material violation by Employee of
the Company’s policies, rules or regulations that has a material adverse
effect on the Company (as reasonably determined by the Company); (3) commission
of any act of fraud, embezzlement or dishonesty by Employee that is materially
injurious to the Company (as reasonably determined by the Company); (4) any
other intentional misconduct by Employee adversely affecting the business or
affairs of the Company or any Subsidiary in any material manner (as reasonably
determined by the Company); or (5) intentional or

 

1

 

willful failure of the
Employee to materially perform Employee’s responsibilities hereunder, other
than as a result of permitted leave of absence, vacation, injury or illness.

 

1.6           “Change of
Control” means:  (1) the
closing of a tender offer or exchange offer for the ownership of 50% or more of
the outstanding voting securities of the Company; (2) the Company shall have
entered into a definitive agreement with respect to a tender offer, exchange
offer or merger, consolidation or other business combination with another
corporation and as a result of such tender offer, exchange offer, merger,
consolidation or combination 50% or fewer of the outstanding voting securities
of the surviving or resulting corporation are owned in the aggregate by the
former stockholders of the Company, other than affiliates (within the meaning
of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) of any
party to such merger or consolidation, as the same shall have existed
immediately prior to such merger or consolidation; (3) the Company shall
have entered into a definitive agreement to sell substantially all of its
assets to another corporation which is not a direct or indirect wholly owned
Subsidiary of the Company; (4) a person, within the meaning of Section 3(a)(9) or
of Section 13(d)(3) (as in effect on the date of this Agreement) of
the Exchange Act, shall acquire 50%  or
more of the outstanding voting securities of the Company (whether directly,
indirectly, beneficially or of record) (for purposes hereof, ownership of
voting securities shall take into account and shall include ownership as
determined by applying the provisions of Rule 13d-3(d)(1)(i) as in
effect on the date of this Agreement) pursuant to the Exchange Act; (5) approval
by the stockholders of the Company of a complete liquidation or dissolution of
the Company; or (6) individuals who constitute the Company’s Board of
Directors on the date of this Agreement (the “Incumbent Board”) cease for any
reason to constitute at least a majority thereof, provided that any person
becoming a director subsequent to the date of this Agreement whose election, or
nomination for election by the Company’s stockholders, was approved by a vote
of at least 50% of the directors comprising the Incumbent Board shall be, for
purposes of this clause (6), considered as though such person were a member of
the Incumbent Board.  Notwithstanding the
foregoing, the Lawson/Intentia Transaction is not a Change of Control of the
Company.

 

1.7           “Disability”
means Employee’s permanent disability as defined under any long term disability
plan of the Company, or in the absence of such plan, the inability of Employee,
due to illness or injury, to substantially perform his duties hereunder (after
taking into account any reasonable accommodation required by the Americans with
Disabilities Act) for a period of at least 180 consecutive days.  The determination of a Disability shall be
based on competent medical opinion.

 

1.8           “Good
Reason” means:  (1) Company
effects a material diminution of Employee’s duties or reporting
responsibilities or a diminution of Employee’s title of Chief Executive Officer
of the Company; (2) the failure by Company, or its successor, if any, to
pay compensation or provide benefits to Employee as and when required by the
terms of this Agreement; or (3) any material breach by Company of this
Agreement that is not timely cured by Company after notice from Employee.

 

1.9           “Invention and
Non-Disclosure Agreement”
means the Lawson Software, Inc. Employee Invention and Non-Disclosure
Agreement entered into between the Company and Employee.

 

1.10         “Lawson/Intentia
Transaction” means the
business combination announced on or about June 2, 2005, under which the
Company (or an affiliate of the Company) has offered to purchase all of the
capital stock of Intentia International AB.

 

1.11         “Plan”
means any bonus or incentive compensation agreement, plan, program, policy or
arrangement sponsored, maintained or contributed to by Company, to which
Company is a party or under which employees of Company are covered, including,
without limitation, any stock option, restricted

 

2

 

stock or any other equity
based compensation plan, and any employee benefit plan, such as a thrift,
pension, profit sharing, deferred compensation, medical, dental, disability,
accident, life insurance, automobile allowance, perquisite, fringe benefit,
vacation, sick or parental leave, severance or relocation plan or policy or any
other agreement, plan, program, policy or arrangement intended to benefit
employees or executive officers of Company.

 

1.12         “Subsidiary” means any corporation at least a majority of
whose securities having ordinary voting power for the election of directors
(other than securities having such power only by reason of the occurrence of a
contingency) is at the time owned by the Company and/or one (1) or more
Subsidiaries.

 

1.13         “Release/Restrictive Covenant” means the form of General Release and
Restrictive Covenants attached as Exhibit A.

 

1.14         “Term”
means the period during which this Agreement is in effect.

 

Article II. 
Employment, Term, and Duties

 

2.1           Employment.  Company hereby employs
Employee as an executive officer of the Company as of the Agreement Date.  Commencing June 15, 2005 and continuing
for the balance of the Term:  (a) Employee
shall serve as the Company’s President and Chief Executive Officer, pursuant to
the Company’s Bylaws and (b) Employee shall become a member of the Board,
pursuant to the Company’s Bylaws. 
Employee accepts such employment and agrees to perform services for
Company for the period and upon the other terms and conditions set forth in
this Agreement.

 

2.2           Term.  The Term shall commence on the
Agreement Date and continue in effect until terminated in accordance with Article IV
of this Agreement.

 

2.3           Position and Duties.

 

(a)           Service with Company. 
During the Term, Employee agrees to perform such duties and
responsibilities (a) as are set forth for that position in the By-laws of
the Company; (b) as the Board shall assign to the Employee from time to
time consistent with his position; and (c) that the Employee undertakes or
accepts consistent with his position. 
Employee acknowledges and agrees that, from time to time, Employee will
be required to perform duties with respect to one or more of the Company’s
subsidiary or affiliate companies and that Employee will not be entitled to any
additional compensation for performing those duties.  Employee also agrees to serve, for any period
for which Employee is elected, as an director of Company; provided, however, that Employee shall not
be entitled to any additional compensation for serving as a director.  Upon termination of Employee’s employment,
for whatever reason, Employee will be deemed to have resigned as an officer and
director of the Company.

 

(b)           Performance of Duties. 
Commencing as of the Agreement Date through June 14, 2005, Employee
agrees to devote Employee’s part time services to the Company, but only to the
extent that such services do not interfere with Employee’s obligations to his
existing employer, and commencing June 15, 2005 and continuing during the
Term, Employee agrees to devote Employee’s full business time, attention and
efforts to the business and affairs of Company (exclusive of any period of
vacation, sick, disability or other leave to which Employee is entitled).  Employee may participate in charitable and
civic activities so long as Employee remains available to provide Employee’s
full time services to the Company. 
Employee will review and agree to comply with the Company’s then current
Code of Conduct to the same extent required

 

3

 

for
other United States-based employees of the Company.  Employee will perform all of Employee’s
responsibilities in compliance with all applicable laws.  Employee acknowledges that in his capacity as
principal executive officer of the Company, he will be expected to execute
certain documents on behalf of the Company under the federal securities laws,
which may include documents covering periods prior to the Agreement Date.  As of the Agreement Date, Employee has no
reason to believer that he would not be prepared to execute on and after June 15,
2005 all documents required for signature by the Company’s principal executive
officer (e.g. the Form S-4
for the Lawson/Intentia Transaction and the Company’s annual report on Form 10-K
for the fiscal year ended May 31, 2005), assuming that the Company’s
principal financial officer and directors were also prepared to execute such
documents to the extent required.

 

2.4           Relocation.  On or before the later of December 31,
2005, or if later, sixty (60) days following the closing of the Lawson/Intentia
Transaction, and thereafter during the Term, Employee shall have a residence in
the Minneapolis/St. Paul Metropolitan area. 
Commencing June 15, 2005, Employee’s principal office shall be at
the Company’s headquarters in St. Paul, Minnesota.

 

Article III. 
Compensation, Benefits and Expenses

 

3.1           Base Salary.  Subject to the provisions of Article IV
of this Agreement, during the Term Company shall pay Employee a Base Salary at
an annual rate that is not less than Five Hundred Thousand dollars
($500,000.00) or such higher annual rate as may from time to time be approved
by the Board, such Base Salary to be paid in substantially equal regular
periodic payments, less deductions and withholdings, in accordance with Company’s
regular payroll procedures, policies and practices as such may be modified from
time to time.  Employee shall be
eligible, at Company’s sole discretion, for annual salary increases consistent
with such procedures, policies and practices and if Employee’s Base Salary is
increased from time to time during the Term, the increased amount shall become
the Base Salary for the remainder of the Term and for as long thereafter as
required pursuant to Article IV, subject to any subsequent increases.  Employee’s Base Salary may not be decreased
during the Term.

 

3.2           Incentive Compensation. 
Employee will participate in the Company’s Executive Leadership Results
Plan (“ELRP”) in accordance with which Employee may earn an annual incentive
bonus.  The terms of the annual incentive
bonus plan, including the criteria upon which Employee can earn the maximum
bonus, will be determined annually by the Board.  For each of the Company’s fiscal years ending
during the Term, beginning with the Company’s fiscal year ending May 31,
2006 (“FY06”), Employee’s annual target incentive under the ELRP shall be at
least 100% of his annual Base Salary. 
Under the ELRP, a participant must be employed by the Company on the
last day of a fiscal year to be eligible to receive annual incentive
compensation that is payable for that fiscal year.  Notwithstanding any other provision of the
ELRP:  (a) the Company shall pay
Employee a guaranteed incentive payment of $150,000.00 (less withholding taxes)
on the second payroll date after November 30, 2005 and (b) the
Company shall pay Employee an additional guaranteed incentive payment of
$150,000.00 (less withholding taxes) on the second payroll date after May 31,
2006 (collectively, the “FY06 Guaranteed Incentive Payments”).  The pre-tax amount of any FY06 Guaranteed
Incentive Payments paid to Employee shall be deducted from any other incentive
payments payable to Employee under the ELRP or any other bonus arrangement for
FY06.

 

3.3           Stock Options.  As
of the Agreement Date, the Company will approve the grant to Employee of an
option to purchase 2,500,000 shares of the Company’s common stock (the “Stock
Option”) in accordance with the terms of the Company’s 1996 Stock Incentive
Plan, as the same may be amended from time to time (“1996 Plan”), and a
nonqualified stock option agreement will be entered into

 

4

 

by the Employee and the
Company (the “Option Agreement”).  The
Stock Option will be subject to vesting and other requirements described in the
Option Agreement and 1996 Plan.

 

3.4           Restricted Stock Award.  As
of the Agreement Date, the Company will approve a grant to Employee of 100,000
shares of the Company’s common stock in accordance with the terms of the 1996
Plan (the “Restricted Stock”), and a restricted stock award agreement will be
entered into by the Employee and the Company (the “Restricted Stock Agreement”).  The Restricted Stock will be subject to
vesting and other requirements described in the Restricted Stock Agreement and
1996 Plan.

 

3.5           Participation in Benefits. 
During the Term of Employee’s employment by Company, Employee shall be
entitled to participate in the employee benefits offered generally by Company
to its employees, to the extent that Employee’s position, tenure, salary,
health and other qualifications make Employee eligible to participate.  Employee’s participation in such benefits
shall be subject to the terms of the applicable plans, as the same may be
amended from time to time.  Company does
not guarantee the adoption or continuance of any particular employee benefit
during Employee’s employment, and nothing in this Agreement is intended to, or
shall in any way restrict the right of Company, to amend, modify or terminate
any of its benefits during the Term.

 

3.6           Expenses.  In accordance with Company’s
normal policies for expense reimbursement, Company will reimburse Employee for
all reasonable and necessary expenses incurred by Employee in the performance
of Employee’s duties under this Agreement, subject to the presentment of
receipts or other documentation acceptable to Company.

 

3.7           Relocation Expenses. 
Company shall reimburse Employee for reasonable and customary relocation
expenses, including, but not limited to, temporary housing in the St.
Paul/Minneapolis area until sixty days following the closing of the
Lawson/Intentia Transaction.  The Company
shall pay associated closing costs upon the purchase by Employee of a residence
in St. Paul/Minneapolis. If the Employee sells his residence in Denver on or
before December 31, 2006, the Company shall pay real estate commissions
and closing costs associated with Employee’s sale of existing residence.  The Company shall pay the costs of packing,
loading, transporting, storing (as required) and unloading of Employee’s existing
personal property from present residence to new residence.  The Company’s obligation under this Section shall
not exceed $150,000.00.  Such
reimbursements shall be made by Company on a timely basis upon submission by
Employee of receipts evidencing such expenses.

 

3.8           No Prior Period Restatements.  As of the date hereof and as of the date the Company first announces
its results for the fiscal year ended May 31, 2005, the Company represents
and warrants that the Company has complied with all financial reporting
requirements under the federal securities laws in all material respects, and no
facts, events or circumstances exist which would require the Company to prepare
an accounting restatement due to misconduct within the meaning of Section 304
of the Sarbanes-Oxley Act of 2002.  In
the event that the Company prepares an accounting restatement for a fiscal
period ending prior to the Agreement Date, the Company shall at its expense
file a petition with the Securities and Exchange Commission under Section 304(b) of
the Sarbanes-Oxley Act seeking to exempt Employee from the operation of the Section 304(a) thereof.

 

3.9           Tier 1 Change of Control Severance Pay Plan
Not Applicable to Employee.  The Company’s Executive Change in Control
Severance Pay Plan for Tier 1 Executives (first adopted by the Company on January 17,
2005) does not and will not apply to Employee.

 

5

 

Article IV. 
Termination and Compensation Following Termination

 

4.1           Termination.  Subject to the respective
continuing obligations of the parties under this Agreement, the Term and
Employee’s employment hereunder may be terminated under the following
circumstances:

 

(a)           Mutual Agreement.  By
mutual written agreement of the parties at any time.

 

(b)           Death.  In the event of Employee’s
death.

 

(c)           Employee’s Disability.  In
the event Employee becomes Disabled. 
During the period in which Employee is absent from work due to an injury
or illness which may result in a Disability, the Company shall continue to pay
to Employee the compensation, benefits and other payments and awards set forth
in Article III hereof.

 

(d)           Termination by Company for Cause. 
Company may terminate this Agreement and Employee’s employment hereunder
for Cause at any time after providing written notice to Employee.  Notwithstanding the foregoing, a termination
for Cause, if susceptible of cure, shall not become effective unless Employee
fails to cure such failure to perform within 10 days after written notice from
Company, such notice to describe such failure to perform and identify what
reasonable actions shall be required to cure such failure to perform.

 

(e)           Termination By Employee For Good Reason. 
Employee may terminate Employee’s employment hereunder for Good
Reason.  Notwithstanding the foregoing,
the Employee shall have Good Reason to terminate Employee’s employment only if (i) Employee
notifies the Company in writing that Employee has determined Good Reason exists
and specifies the event creating Good Reason, and (ii) following receipt
of such notice, the Company fails to remedy such event within 10 days.

 

(f)            Termination by Company Without Cause. 
Company may terminate Employee’s employment hereunder at any time for
any reason (including without limitation a Change in Control), or no reason and
with notice.

 

(g)           Termination by Employee Without Good Reason.  The
Employee may terminate Employee’s employment hereunder at any time for any
reason (including without limitation a Change in Control) or no reason, upon 10
days advance written notice.

 

4.2           Effect of Termination. 
Notwithstanding any termination of this Agreement and/or Employee’s
employment with Company, Employee, in consideration of Employee’s employment
hereunder to the date of such termination, shall remain bound by the provisions
of this Agreement that specifically relate to periods, activities or
obligations upon or subsequent to the termination of Employee’s employment,
including, but not limited to, the covenants contained in Article V and
the Invention and Non-Disclosure Agreement.

 

4.3           Surrender of Records and Property.  Upon
termination of Employee’s employment with Company, Employee shall deliver
promptly to Company all records, manuals, books, blank forms, documents,
letters, memoranda, notes, notebooks, reports, computers, computer disks,
computer software, computer programs (including source code, object code,
on-line files, documentation, testing materials and plans and reports),
designs, drawings, sketches, devices, specifications, formulae, data, tables or
calculations or copies thereof, which are the property of Company or any
subsidiary or affiliate or which relate in any way to the business, products,
practices or techniques of Company or any Subsidiary.

 

6

 

4.4           Compensation Following Termination of the
Term.  In the event that Employee’s employment
hereunder is terminated prior to the end of the Term, Employee shall be
entitled only to the following compensation and benefits upon such termination;
provided, however, as a condition precedent to the payment of any severance
under Sections 4.4(c) or (d) of this Agreement, Employee shall have
executed the General Release and Restrictive Covenants in the form attached
hereto as Exhibit A (the “Release/Restrictive Covenant”) and the
revocation or rescission period specified therein shall have expired:

 

(a)           Termination by Mutual Agreement or Employee
For No Reason.  In the event that Employee’s employment is
terminated by mutual agreement or by the Employee for no reason (unless
Employee terminates pursuant to Section 4.4(d), in which case Section 4.4(d) shall
govern), Company shall promptly pay to Employee any amounts due to Employee for
Base Salary through the date of employment termination, together with any other
unpaid and pro rata amounts to which Employee is entitled as of the date of
termination pursuant to Article III of this Agreement, including, without
limitation, any bonus that is earned because Employee was employed on the last
day of the fiscal year as provided in Section 3.2, amounts that Employee
is entitled to under any equity compensation, bonus, benefit or other plan of,
or agreement with, the Company in accordance with the terms of such plan or
agreement.  Employee will have no rights
to any unvested benefits or any other compensation or payments coming due after
the date of Employee’s employment termination.

 

 (b)          Termination by Company for Cause or by
Employee Without Good Reason.  If the Employee’s employment is terminated by
the Company for Cause or the Employee voluntarily terminates employment without
Good Reason (unless Employee terminates pursuant to Section 4.4(d), in
which case Section 4.4(d) shall govern), the Company shall promptly
pay to the Employee (1) any Base Salary earned but not paid through the
date of Employee’s employment termination, plus (2) any bonus that is
earned because Employee was employed on the last day of the fiscal year as
provided in Section 3.2, and amounts that Employee is entitled to under
any equity compensation, bonus, benefit or other plan of, or agreement with the
Company in accordance with the terms of such plan or agreement .  The Company shall have no further obligations
under this Agreement.

 

(c)           Termination by Employee for Good Reason;
Termination by the Company Without Cause; Termination by Reason of Employee’s
Death or Disability.  In the event that Employee’s employment is
terminated by Employee for Good Reason, by the Company without Cause (whether
or not there is a Change of Control) or by reason of Employee’s death or
Disability, Company shall promptly pay to Employee, Employee’s estate or
Employee’s spouse, as the case may be:  (1) any
amounts due to Employee for Base Salary through the date of employment
termination, together with any other unpaid and pro rata amounts to which
Employee is entitled as of the date of termination pursuant to Article III
of this Agreement, including, without limitation, any bonus that is earned
because Employee was employed on the last day of the fiscal year as provided in
Section 3.2, amounts that Employee is entitled to under any equity
compensation, bonus, benefit or other plan of, or agreement with, the Company
in accordance with the terms of such plan or agreement, plus (2) one times
Employee’s then current annual Base Salary plus (3) one times Employee’s
then current annual target bonus plus (4)  if the termination occurs
during the fiscal year ending May 31, 2006, any FY06 Guaranteed Incentive
Payment described in Sections 3.2(a) and 3.2(b) which have not
previously been paid, plus (5) for fiscal years beginning on or after June 1,
2006, if is termination occurs during the second half of the Company’s fiscal
year, a target bonus, to the extent not previously paid, pro rated based on
number of days employed during such fiscal) for such fiscal year.  If such termination of employment occurs
before June 1, 2006, the amount of any severance payment under this
Section 4.4(c)

 

7

 

shall
not be reduced by any FY06 Guaranteed Incentive Payments paid to Employee and
which were not otherwise earned under the ELRP based on FY06 actual
performance.  Except to the extent of any
applicable acceleration of vesting described in the Stock Option Agreement
dated June 2, 2005 and the Restricted Stock Award Agreement dated June 2,
2005, Employee will have no rights to any unvested benefits or any other
compensation or payments coming due after the date of Employee’s employment
termination. The Company shall have no further obligations under this Agreement.  Notwithstanding the foregoing, to the extent
required to avoid taxation of any amounts hereunder under Section 409A(a) of
the Internal Revenue Code of 1986 as amended, payment of such amounts shall be
delayed for at least six months following termination of employment.

 

(d)           Termination Because Lawson/Intentia
Transaction Does Not Close By May 31, 2006.  If
the Lawson/Intentia Transaction terminates or has not closed by May 31,
2006 (the earlier of such dates is referred to as the “Transaction Termination
Date”), then within 60 days after the Transaction Termination Date, the Company
or Employee may elect to terminate Employee’s employment, in which case Company
shall promptly pay to Employee (1) any amounts due to Employee for Base
Salary through the date of employment termination, together with any other
unpaid and pro rata amounts to which Employee is entitled as of the date of
termination pursuant to Article III of this Agreement, including, without
limitation, any bonus that is earned because Employee was employed on the last
day of the fiscal year as provided in Section 3.2, amounts that Employee
is entitled to under any equity compensation, bonus, benefit or other plan of,
or agreement with, the Company in accordance with the terms of such plan or
agreement, plus (2)  if the termination occurs during the fiscal year
ending May 31, 2006, any FY06 Guaranteed Incentive Payment described in
Sections 3.2(a) and 3.2(b) which have not previously been paid, plus (3) one
times Employee’s then current annual Base Salary plus (4) one times
Employee’s then current annual target bonus. 
The amount of any severance payment under this Section 4.4(d) shall
not be reduced by any FY06 Guaranteed Incentive Payments paid to Employee.  Except to the extent of any applicable
acceleration of vesting described in the Stock Option Agreement dated June 2,
2005 and the Restricted Stock Award Agreement dated June 2, 2005, Employee
will have no rights to any unvested benefits or any other compensation or
payments coming due after the date of Employee’s employment termination. The
Company shall have no further obligations under this Agreement. Notwithstanding
the foregoing, to the extent required to avoid taxation of any amounts
hereunder under Section 409A(a) of the Internal Revenue Code of 1986
as amended, payment of such amounts shall be delayed for at least six months
following termination of employment.

 

4.5           No Mitigation Obligation. 
Employee shall not be required to mitigate the amount of any payment
provided to Employee under Section 4.4 of this Agreement by seeking other
employment. The Company may not claim a right of offset to reduce any payment
to Employee required hereunder

 

4.6           No Other Benefits or Compensation. 
Except as may be provided under this Agreement, under the terms of any
incentive compensation, employee benefit or fringe benefit plan applicable to
Employee at the time of the termination of Employee’s employment, Employee
shall have no right to receive any other compensation or to participate in any
other plan, arrangement or benefit, with respect to any future period after
such termination or resignation.

 

Article V. 
Noncompetition and Nonsolicitation

 

5.1           Release/Restrictive Covenant.  The
Release/Restrictive Covenant attached as Exhibit A includes certain
noncompetition and nonsolicitation covenants of Employee that are a condition
precedent to the payment of any severance under Sections 4.4(c) or (d) above.

 

8

 

5.2           Covenant Not To Compete—Five Competitors. 
Before the payment of any severance under Section 4.4(c) or (d) of
this Agreement and execution of the Release/Restrictive Covenant, the Company
shall notify Employee of the names of five competitors that will be identified
as the “Five Competitors” in Section 2.1 of the Release/Restrictive
Covenant.

 

5.3           Covenant Not To Compete—25 Clients/Prospects. 
Before the payment of any severance under Section 4.4(c) or (d) of
this Agreement and execution of the Release/Restrictive Covenant, the Company
shall notify Employee of the names of 25 clients and/or prospects that will be
identified as the “25 Clients/Prospects” in Section 2.2 of the
Release/Restrictive Covenant.

 

Article VI.             Tax Consideration.

 

Notwithstanding
anything herein to the contrary, in the event any payments to the Employee
hereunder or under any equity or option award, including the value of any
acceleration of such award, (“Total Payments”) are determined by the Company to
be subject to the tax imposed by Section 4999 of the Internal Revenue Code
of 1986, as amended (the “Code”) or any similar federal or state excise tax,
FICA tax, or any interest or penalties are incurred by the Employee with
respect to such excise tax (such excise tax, together with any such interest or
penalties are hereinafter collectively referred to as the “Excise Tax”), the
Company shall pay to the Employee an additional amount (the “Gross-Up Payment”)
such that after the payment by the Employee of all federal, state, or local
income taxes, Excise Taxes, FICA taxes, or other taxes (including any interest
or penalties imposed with respect thereto) imposed upon the receipt of the
Gross-Up Payment, the Employee retains an amount of the Gross-Up Payment equal
to the Excise Tax imposed on the Total Payments.  Any Gross-Up Payment may be withheld by the
Company from the Employee and submitted to the applicable governmental taxing
authorities on Employee’s behalf.

 

If
the Excise Tax is subsequently determined to be less than the amount taken into
account hereunder at the time of termination of employment, the Employee shall
repay to the Company, at the time the reduction in Excise Tax is finally
determined, the portion of the Gross-Up Payment attributable to such reduction;
provided, however, that Employee shall not be obligated to return such excess
until receipt by the Employee of a refund of such amount from the applicable
governmental taxing authorities. .  If
the Excise Tax is determined to exceed the amount taken into account hereunder
at the time of termination of employment, the Company shall make an additional
Gross-Up Payment to the Employee (or to the applicable governmental taxing
authorities as withholding on the Employee’s behalf) in respect of such excess
at the time the amount of such excess is finally determined.  The Employee shall notify the Company in
writing of any claim by the Internal Revenue Service that, if successful, would
require the payment by the Company of the Gross-Up Payment.  Such notification shall be given as soon as
practicable but no later than ten (10) business days after the Employee is
informed in writing of such claim and shall apprise the Company of the nature
of such claim and the date on which such claim is requested to be paid.  The Employee shall not pay such claim prior
to the expiration of the thirty (30) day period following the date on which he
or she gives such notice to the Company (or such shorter period ending on the
date that any payment of taxes with respect to such claim is due).  If the Company notifies the Employee in
writing prior to the expiration of such period that it desires to contest such
claim, the Employee shall:

 

(a)           give the Company any information reasonably
requested by the Company relating to such claim;

 

9

 

(b)           take such action in connection with
contesting such claim as the Company shall reasonably request in writing from
time to time, including, without limitation, accepting legal representation
with respect to such claim by an attorney reasonably selected by the Company;

 

 (c)          cooperate with the Company in good faith in
order to effectively contest such claim; and

 

(d)           permit the Company to participate in any
proceedings relating to such claim;

 

provided, however, that the Company shall bear and pay
directly all costs and expenses (including legal and accounting fees and
additional interest and penalties) incurred in connection with such contest and
shall indemnify and hold the Employee harmless, on an after-tax basis, for any
Excise Tax, FICA tax, or income tax (including interest and penalties with
respect thereto) imposed as a result of such representation and payment of
costs and expenses.  Without limitation
on the foregoing provisions of this Article VI, the Company shall control
all proceedings taken in connection with such contest and, at its sole option,
may pursue or forgo any and all administrative appeals, proceedings, hearings,
and conferences with the taxing authority in respect of such claim and may, at
its sole option, either direct the Employee to pay the tax claimed and sue for
a refund or contest the claim in any permissible manner, and the Employee
agrees to prosecute such contest to a determination before any administrative
tribunal, in a court of initial jurisdiction, and in one or more appellate courts,
as the Company shall determine; provided, however, that if the Company directs
the Employee to pay such claim and sue for a refund, the Company shall advance
the amount of such payment to the Employee, on an interest-free basis, and
shall indemnify and hold the Employee harmless, on an after-tax basis, from any
Excise Tax or income tax (including interest or penalties with respect thereto)
imposed with respect to such advance or with respect to any imputed income with
respect to such advance; and provided, further, that any extension of the
statute of limitations relating to payment of taxes for the taxable year of the
Employee with respect to which such contested amount is claimed to be due is
limited solely to such contested amount. 
Furthermore, the Company’s control of the contest shall be limited to
issues with respect to which a Gross-Up Payment would be payable hereunder and
the Employee shall be entitled to settle or contest, as the case may be, other
issues raised by the Internal Revenue Service or any other taxing authority.

 

If
any such claim referred to in this Article VI is made by the Internal
Revenue Service and the Company does not request the Employee to contest the
claim within the thirty (30) day period following notice of the claim, the
Company shall pay to the Employee the amount on any Gross-Up Payment owed to
the Employee, but not previously paid pursuant to this Article VI,
immediately upon the expiration of such thirty (30) day period.  If any such claim is made by the Internal Revenue
Service and the Company requests the Employee to contest such claim, but does
not advance the amount of such claim to the Employee for purposes of such
contest, the Company shall pay to the Employee the amount of any Gross-Up
Payment owed to the Employee, but not previously paid under the provisions of
this Article VI, within five (5) business days of a Final
Determination of the liability of the Employee for such Excise Tax.  For purposes of this Agreement, a “Final
Determination” shall be deemed to occur with respect to a claim

 

10

 

when (i) there is a
decision, judgment, decree, or other order by any court of competent
jurisdiction, which decision, judgment, decree, or other order has become
final, i.e., all allowable appeals pursuant to this Article VI have been
exhausted by either party to the action, (ii) there is a closing agreement
made under Section 7121 of the Code, or (iii) the time for
instituting a claim for refund has expired, or if a claim was filed, the time
for instituting suit with respect thereto has expired.

 

If,
after the receipt by the Employee of an amount advanced by the Company pursuant
to this Article VI, the Employee becomes entitled to receive any refund
with respect to such claim, the Employee shall (subject to the Company’s
complying with the requirements of this Article VI) promptly pay to the
Company the amount of such refund (together with any interest paid or credited
thereon after taxes applicable thereto). 
If after the receipt by the Employee of an amount advanced by the
Company pursuant to this Article VI, a determination is made by the
Internal Revenue Service that the Employee is not entitled to any refund with
respect to such claim and the Company does not notify the Employee in writing
of its intent to contest such denial of refund prior to the expiration of
thirty (30) days after such determination, then such advance shall be forgiven
and shall not be required to be repaid and the amount of such advance shall
offset, to the extent thereof, the amount of Gross-Up Payment required to be
paid.

 

Article VII. 
Miscellaneous Provisions

 

7.1           Tax Consequences. 
Employee acknowledges and agrees that Company has made no
representations or warranties with respect to the tax consequences of any of
the payments or other consideration provided by Company to Employee under the
terms of this Agreement, and that Employee is solely responsible for Employee’s
compliance with any and all laws applicable to such payments or other
consideration.

 

7.2           Withholding Taxes. 
Company may take such action as it deems appropriate to insure that all
applicable federal, state, city and other payroll, withholding, income or other
taxes arising from any compensation, benefits or any other payments made pursuant
to this Agreement, or any other contract, agreement or understanding that
relates, in whole or in part, to Employee’s employment with Company, are
withheld or collected from Employee.  The
Company may deduct applicable withholding taxes from any payments to Employee
under this Agreement.

 

7.3           Assignment.  This Agreement shall not be
assignable, in whole or in part, by any party without the written consent of
the other party and any purported or attempted assignment or transfer of this
Agreement or any of Employee’s duties, responsibilities or obligations
hereunder shall be void. This Agreement is binding upon Employee, Employee’s
heirs and personal representatives. This Agreement shall inure to the benefit
of and be binding upon the Company and its successors and assigns.  Notwithstanding the foregoing, the Company
may, without the consent of Employee, assign its rights and obligations under
this Agreement to any business entity that has become the legal successor to
Company in the event of a sale, merger, liquidation or similar transaction.

 

7.4           Notices.  All notices, requests, demands
and other communications under this Agreement shall be in writing, shall be
deemed to have been duly given on the date of service if personally served on
the parties to whom notice is to be given, or on the second day after mailing
if mailed to the parties to whom notice is given, by registered or certified
mail, return receipt requested, postage prepaid and properly addressed as
follows:

 

11

 

	
  If to the Company, at:

  	
  Lawson Software, Inc.

  380 St. Peter Street

  St. Paul, MN 55102

  Attn: Corporate Secretary

  
	
   

  	
   

  
	
  If to Employee, at:

  	
  (Last address of Employee
  on record at the Company)

  
	
   

  	
   

  
	
  With a copy to:

  	
  Steven G. Schaffer, Esq.

  Powell Goldstein LLP

  Fourteenth Floor

  1201 West Peachtree Street, N.W.

  Atlanta, Georgia 30309-3488

  

 

Any party may change the
address for the purpose of this Section by giving the other written notice
of the new address in the manner set forth above.

 

7.5           Governing Law.  The
validity, interpretation, performance and enforcement of this Agreement shall
be governed by the laws of the State of Minnesota, without regard to conflicts
of laws principles thereof.

 

7.6           Severability.  In
the event any provision of this Agreement (or portion thereof) shall be held
illegal or invalid for any reason, said illegality or invalidity shall not in
any way affect the legality or validity of any other provision of this
Agreement. To the extent any provision (or portion thereof) of this Agreement
shall be determined to be invalid or unenforceable in any jurisdiction, such
provision (or portion thereof) shall be deemed to be deleted from this
Agreement as to such jurisdiction only, and the validity and enforceability of
the remainder of such provision and of this Agreement shall be unaffected.

 

7.7           Entire Agreement.  This
Agreement and the agreements and Plans expressly referenced above is the final,
complete and exclusive agreement of the parties and sets forth the entire
agreement between Company and Employee with respect to Employee’s employment by
Company, and there are no undertakings, covenants or commitments other than as
set forth therein.  The Agreement may not
be altered or amended, except by a writing executed by the party against whom
such alteration or amendment is to be enforced.

 

7.8           Counterparts.  This
Agreement may be simultaneously executed in any number of counterparts and by
facsimile.

 

7.9           Survival.  The parties expressly
acknowledge and agree that the provisions of this Agreement that by their
express or implied terms extend beyond the expiration of this Agreement or the
termination of Employee’s employment under this Agreement, shall continue in
full force and effect, notwithstanding Employee’s termination of employment
under this Agreement or the expiration of this Agreement.

 

7.10         Waivers.  No failure on the part of
either party to exercise, and no delay in exercising, any right or remedy under
this Agreement shall operate as a waiver thereof; nor shall any single or
partial exercise of any right or remedy under this Agreement preclude any other
or further exercise thereof or the exercise of any other right or remedy
granted hereby or by any related document or by law

 

12

 

7.11         Conditions of Employment. 
Company’s obligations to Employee under this Agreement are conditioned
upon Employee’s timely compliance with requirements of the United States
immigration laws.

 

7.12         No Conflicting Obligations.  Employee represents and warrants
to Company that Employee is free to enter into this Agreement and has no
contract, commitment, arrangement or understanding to or with any party that
restrains or is in conflict with Employee’s performance of the covenants,
services and duties provided for in this Agreement.  Notwithstanding the foregoing, the Company
acknowledges that Employee is currently employed by SPL Worldwide and has
obligations to provide services to such employer until the date when Employee
commences full-time employment with the Company and such obligations and
services shall not be deemed a breach of the representation and warranty
contained in the first sentences of this Section 7.12.

 

7.13         Read and Understood. 
Employee has read this Agreement carefully and understands each of its
terms and conditions.  Employee has
sought independent legal counsel of Employee’s choice (and at Employee’s own
expense) to the extent Employee deemed such advice necessary in connection with
the review and execution of this Agreement.

 

7.14         Indemnification. The Company shall indemnify
Employee to the fullest extent permitted by the Company’s certificate of
incorporation and bylaws, and any change to those documents that diminish any
protection afforded as of the date hereof to officers or members of the Board
thereunder shall not be applied to reduce Employee’s protection thereunder. The
provisions under this Section shall continue to apply to Employee
following his termination of employment.

 

7.15.
Arbitration. All disputes in any way relating to this Agreement or in any way
relating to Employee’s employment by the Employer, will be resolved by binding
arbitration in St. Paul/ Minneapolis in accordance with the commercial
arbitration rules of the American Arbitration Association then in effect.
Each party shall pay its own costs and expenses (including attorneys’ fees)
relating to such dispute and the arbitration, except that if the arbitrator
determines that the Company did not have a good faith dispute or the Company
was in intentional breach of this Agreement or of any other agreement between
the Company and Employee, the Company shall be required to pay the costs and
expenses (including reasonable attorneys’ fees) relating to such dispute and
the arbitration.

 

13

 

7.16
Attorneys’ Fees.  The Company shall pay
Employee’s attorneys’ fees in negotiating this Agreement and ancillary
documents relating thereto in an amount not to exceed $10,000.00

 

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first
above written.

 

	
   

  	
  Lawson Software, Inc.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
  /s/ H. Richard Lawson

  	
   

  
	
   

  	
   

  	
  H. Richard Lawson,

  	
   

  
	
   

  	
   

  	
  Chairman

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Harry Debes

  	
   

  
	
   

  	
  Harry Debes

  	
   

  

 

14

 

EXHIBIT A

 

GENERAL RELEASE AND RESTRICTIVE COVENANTS

 

This
General Release and Restrictive Covenants (“Release/Restrictive Covenant”) is
made and entered into as of the
         day of
                            ,
                
, by Harry Debes (“Employee”).

 

WHEREAS, Lawson Software, Inc. (the “Company”)
and Employee are parties to an Employment Agreement dated June      ,
2005;

 

WHEREAS, Employee intends to settle any and all claims that Employee has or
may have against Company as a result of Employee’s employment with Company and
the cessation of Employee’s employment with Company; and

 

WHEREAS, Under the terms of the Employment Agreement, which Employee agrees
are fair and reasonable, Employee agreed to enter into this Release/Restrictive
Covenant as a condition precedent to the severance arrangements described in Article IV
of the Employment Agreement.

 

NOW, THEREFORE, in consideration of the provisions and the mutual covenants herein
contained, the parties agree as follows:

 

1.             Release.  For the consideration expressed in the
Employment Agreement, Employee does hereby fully and completely release and
waive any and all claims, complaints, causes of action, demands, suits and
damages, of any kind or character, which Employee has or may have against the
Released Parties, as hereinafter defined, arising out of any acts, omissions,
conduct, decisions, behavior or events, in each case directly relating to his
employment by the Company, occurring up through the date of Employee’s
signature on this Release/Restrictive Covenant, including Employee’s employment
with Company and the cessation of that employment.  For purposes of this Release/Restrictive
Covenant, “Released Parties” means collectively Company, its predecessors,
successors, assigns, parents, affiliates, subsidiaries, related companies,
officers, directors, shareholders, agents, servants, employees and insurers,
and each and all thereof.

 

Employee
understands and accepts that Employee’s release of claims includes any and all
possible discrimination claims, including, but not limited to, claims based
upon:  Title VII of the Federal
Civil Rights Act of 1964, as amended; the Age Discrimination in Employment Act;
the Americans with Disabilities Act; the Equal Pay Act; the Fair Labor
Standards Act; the Employee Retirement Income Security Act; the Minnesota Human
Rights Act; Minn. Stat. §181.81; the Minneapolis or St. Paul Code of
Ordinances; or any other federal, state or local statute, ordinance or
law.  Employee also understands that
Employee is giving up all other claims, including those grounded in contract or
tort theories, including, but not limited to: 
wrongful discharge; violation of Minn. Stat. §176.82; breach of
contract; tortious interference with contractual relations; promissory
estoppel; breach of the implied covenant of good faith and fair dealing; breach
of express or implied promise; breach of manuals or other policies; assault;
battery; fraud; false imprisonment; invasion of privacy; intentional or
negligent misrepresentation; defamation, including libel, slander, discharge
defamation and self-publication defamation; discharge in violation of public
policy; whistleblower; intentional or negligent infliction of emotional
distress; or any other theory, whether legal or equitable.

 

Employee
further understands that, with respect to the claims he has released as
provided above, Employee is releasing, and does hereby release, any claims for
damages, by charge or otherwise, whether brought by Employee or on Employee’s
behalf by any other party, governmental or otherwise, and agrees not to
institute any claims for damages via administrative or legal proceedings
against any of the Released

 

15

 

Parties.  Employee also waives and releases, with
respect to the claims he has released as provided above, any and all rights to
money damages or other legal relief awarded by any governmental agency related
to any charge or other claim against any of the Released Parties.

 

This
Section 1 does not apply to any post-termination claim that Employee may
have for benefits or other payments required under the provisions of the
Employment Agreement, equity compensation, bonus, employee benefit, or other
plan of or agreement with Company.

 

Employee’s
release of claims shall not apply to any claims Employee might have to
indemnification under Minnesota Statute §302A.521, any other applicable statute
or regulation or Company’s by-laws or pursuant to the Employment Agreement.

 

2.             Covenants Restricting Employee.  Employee covenants and agrees as follows:

 

2.1           Covenant Not To Compete—Five Competitors. 
Employee covenants and agrees that throughout the one year period after
the date of this Release/Restrictive Covenant, Employee shall not:  (a) be employed by [Company will fill in names of 5 competitors of the
Company] (or any of their respective wholly owned subsidiaries)
(collectively referred to as the “Five Competitors”) or (b) directly or
indirectly provide any consulting or other services to any of the Five
Competitors anywhere in the world.  If
one or more of the Five Competitors acquire one another, this Section 2.1
shall remain in effect through the end of the time period described above for
each of the resulting successors to the Five Competitors.  If one of the Five Competitors acquires
Employee’s then current employer, that acquisition will not result in a
violation of this Section 2.1(e.g. Employee may continue to work for that
employer or its successor).  If another
company buys one of the Five Competitors, that acquisition and this Section 2.1
will not prohibit Employee from working for the combined company.

 

2.2           Covenant Not To Compete—25 Clients/Prospects. 
Employee covenants and agrees that throughout the one year period after
the date of this Release/Restrictive Covenant, Employee shall not:  (a) directly solicit any of the
following clients or prospects of the Company [Company
will fill in names of 25 clients and/or prospects of the Company]
(collectively referred to as the “25 Clients/Prospects”) with the purpose of
inducing the 25 Clients/Prospects to diminish any business conducted or to be
conducted with the Company or (b) directly provide any employment,
consulting or other services to any of the 25 Clients/Prospects anywhere in the
world.  If one or more of the 25 Clients/Prospects
acquire one another, this Section 2.2 shall remain in effect through the
end of the time period described above for each of the resulting successors to
the 25 Clients/Prospects.  If one of the
25 Clients/Prospects acquires Employee’s then current employer, that
acquisition will not result in a violation of this Section 2.2 (e.g.
Employee may continue to work for that employer or its successor).  If another company buys one of the 25
Clients/Prospects, that acquisition and this Section 2.2 will not prohibit
Employee from working for the combined company.

 

2.3           Covenant Not To Hire or Solicit The Company
Employees.  Employee covenants and agrees that throughout
the one year period after the date of this Release/Restrictive Covenant,
Employee shall not directly or indirectly, hire or solicit any the Company
employees for the purpose of hiring them or inducing them to leave employment
at the Company.

 

2.4           Remedies.  Employee acknowledges that the
violation of this Section 2 will cause irreparable harm to the Company and
agrees that, in addition to any other relief afforded by law, an injunction
against any violation of this Section t may issue against Employee.  Both damages and injunction shall be proper
modes of relief and are not alternative remedies for

 

16

 

Employee’s
violation of this Section t.  If the
Company commences any action in equity to specifically enforce any of its
rights under this Section 2, Employee waives and agrees not to assert the
defense that The Company has an adequate remedy at law.

 

3.             Rescission.  Employee has been informed of Employee’s
right to rescind this Release/Restrictive Covenant by written notice to Company
within fifteen (15) calendar days after the execution of this Release/Restrictive
Covenant.  Employee has been informed and
understands that any such rescission must be in writing and delivered to
Company (to the attention of the Corporate Secretary) by hand or sent by mail
within the 15-day time period.  If
delivered by mail, the rescission must be: 
(1) postmarked within the applicable period and (2) sent by
certified mail, return receipt requested.

 

Employee
understands that Company will have no obligations under the Employment
Agreement in the event a notice of rescission by Employee is timely delivered,
and, in the event Employee rescinds this Release/Restrictive Covenant, Employee
agrees to repay to Company any payments made to Employee or benefits conferred
upon him pursuant to Article IV of the Employment Agreement prior to the
date of rescission.

 

4.             Acceptance Period; Advice of Counsel.  The terms of this
Release/Restrictive Covenant will be open for acceptance by Employee for a
period of 21 days during which time Employee may consider whether or not to
accept this Release/Restrictive Covenant. 
Employee agrees that changes to this Release/Restrictive Covenant,
whether material or immaterial, will not restart this acceptance period.  Employee is hereby advised to seek the advice
of an attorney regarding this Release/Restrictive Covenant.

 

5.             Binding Agreement.  This Release/Restrictive Covenant shall be
binding upon, and inure to the benefit of, Employee and Company and their
respective successors and permitted assigns.

 

6.             Representation.  Employee hereby acknowledges and states that
Employee has read this Release/Restrictive Covenant.  Employee further represents that this
Release/Restrictive Covenant is written in language that is understandable to
Employee, that Employee fully appreciates the meaning of its terms, and that
Employee enters into this Release/Restrictive Covenant freely and voluntarily.

 

IN WITNESS WHEREOF, Employee, after due consideration, has
authorized, executed and delivered this Release/Restrictive Covenant all as of
the date first written above.

 

 

	
   

  	
   

  	
   

  
	
   

  	
  Harry Debes

  

 

17

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