Document:

exv10w7

 

Exhibit 10.7

November 23, 2005

Mr. Michael A. Aviles

6604 Canyon Wren Drive

Austin, Texas 78746

     Re: Stock Repurchase, Separation Agreement and General Release

Dear Mr. Aviles:

          This is to confirm our agreements relating to the repurchase of stock related to your
currently exercisable stock options and your separation from employment. For purposes of this
Stock Repurchase, Separation Agreement and General Release (the “Agreement”), the terms “You” or
“Your” shall refer to Mr. Aviles and the “Company” shall refer collectively to Activant Solutions
Inc., formerly known as Cooperative Computing, Inc., and Activant Solutions Holdings Inc.

          In consideration of the covenants, agreements, and promises set forth herein, and for other
good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:

     1. Your employment by the Company ended effective as of the close of business, October 7,
2004.

     2. As consideration for this Agreement, You shall receive the following payments(s) and
benefits for the period(s) indicated, less any payroll deductions required by law, which shall be
in lieu of any other payments or benefits to which you otherwise might be entitled:

     (a) As consideration for the agreements, promises and releases contained herein, and
set forth in Section 8, the Company hereby purchases, and You hereby sell to the Company,
the 300,000 shares of common stock otherwise issuable on exercise of Your vested stock
options (the “Activant Options”), pursuant to the Incentive Stock Option Agreement for Key
Employees by and between You and the Company dated February 16, 2000 (the “Option
Agreement”), with a gross value of $1,140,000 less $300,000 of option exercise proceeds for
a purchase price equal to $840,000 (the “Option Purchase Price”). Pursuant to the Option
Agreement between You and the Company, the Company is required to withhold taxes on Your
behalf. The Company will withhold and pay in on Your behalf, the sum of $250,000 for
applicable Federal income taxes and $12,180 for Medicare withholdings, and this results in
a net payment to you

 

 

of $577,820. You acknowledge that for purposes hereof You will be deemed to have
exercised Your Activant Options, which exercise is being treated as a cashless exercise,
that the Company will not issue a stock certificate to evidence the shares of common stock
issuable on exercise of Your vested Activant Options, and that upon your receipt of the
Option Purchase Price listed above (less withholdings), the Option Agreement shall
terminate and cease to be of any further force and effect.

     (b) The Company shall also pay an additional amount of $510,000, less $150,000 for
applicable Federal income taxes and $7,395 for Medicare withholdings, to You as further
consideration for this Agreement and the ADEA release contained herein, as discussed in
more detail in Sections 8 and 9 of this Agreement. This results in a net payment to you of
$352,605 to be made in two installments of $181,230 (which consists of $260,000 less
$75,000 for applicable Federal income taxes and $3,770 for Medicare withholdings) and
$171,375 (which consists of $250,000 less $75,000 for applicable Federal income taxes and
$3,625 for Medicare withholdings) as discussed in more detail in Section 3 of this
Agreement.

     (c) In addition to the foregoing, You will receive a lump sum payment, rather than
installment payments, in the amount of $190,892.61, constituting (i) your remaining
severance in the gross amount of $265,625, less (ii)Federal income tax withholdings of
$90,000 and Medicare withholdings in the amount of $3,851.56, plus (iii) $19,119.17 in
COBRA benefit payments under the Executive Employment Agreement (the “Employment
Agreement”). Your COBRA benefits and premiums have been grossed up to ensure that there is
no tax consequence to you for these additional monies paid to you.

     3. The Company will pay You, by wire transfer of immediately available funds to Bank of
America Checking Account No. 129-114-3882, not later than five (5) business days following the
execution of this Agreement, the sum of $949,942.61, constituting

     (a) $577,820 as set forth in Section 2(a) above;

     (b) $181,230 of the lump sum payment set forth in Section 2(b) above; and

     (c) $190,892.61 as set forth in Section 2(c) above.

The remaining $171,375 net sum of the payment discussed in Section 2(b) will be paid to You
following the date when the ADEA Revocation Period, as such term is defined in Section 8, below,
expires without You revoking the release contained in Section 8 of this Agreement. It is
understood that if You revoke such provisions pursuant to Section 8, You will not be entitled to
receive the additional payment. Such payment will be made to You upon (i) your written
notification to the Company that the ADEA Revocation Period

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has expired and (ii) Your execution of and delivery to the Company of the release in the form
attached hereto as Exhibit A.

     4. The Company agrees to and reaffirms its obligations to You set forth in Paragraph 12 of the
Employment Agreement, including its obligation to provide indemnification of You and to include You
as an additional insured on its directors and officers’ liability policy. Paragraph 12 of the
Employment Agreement is incorporated herein for all purposes.

     5. You and the Company agree that in the event You apply for unemployment insurance benefits,
the Company shall respond to any inquiry from the applicable governmental authority that your
employment ended as a result of a “business reorganization.”

     6. You represent and warrant that you have made reasonable efforts to return to the Company
all non-public documents and other property of the company which are in Your possession or control.

     7. Neither by offering to make nor by making this Agreement does either party admit any
failure of performance, wrongdoing, or violation of law.

     8. Effective as of the execution of this Agreement, You ON BEHALF OF YOURSELF, YOUR SPOUSE,
ATTORNEYS, HEIRS, EXECUTORS, ADMINISTRATORS, AGENTS, ASSIGNS, AND ANY TRUSTS, PARTNERSHIPS AND
OTHER ENTITIES UNDER YOUR CONTROL (TOGETHER, THE “EXECUTIVE PARTIES”), HEREBY GENERALLY
RELEASE AND FOREVER DISCHARGE each of the Company, its respective subsidiaries and affiliates, its
respective predecessors, successors and assigns and their respective past and present stockholders,
members, directors, officers, employees, agents, representatives, principals, insurers and
attorneys (together the “Activant Companies Parties”) and Hicks, Muse, Tate & Furst Equity
Fund III, L.P., HM3 Coinvestors, L.P., Hicks, Muse, Tate, & Furst Incorporated, their respective
subsidiaries and affiliates, their respective predecessors, successors and assigns and their
respective past and present stockholders, members, directors, officers, employees, agents,
representatives, principals, insurers and attorneys (together the “HM Released Parties”)
from any and all claims, demands, liabilities, suits, damages, losses, expenses, attorneys’ fees,
obligations or causes of action, KNOWN OR UNKNOWN of any kind and every nature whatsoever, and
WHETHER OR NOT ACCRUED OR MATURED, which any of them have or may have, arising out of or relating
to any transaction, dealing, relationship, contract, conduct, act or omission, OR ANY OTHER MATTERS
OR THINGS OCCURRING OR EXISTING AT ANY TIME PRIOR TO AND INCLUDING THE EXECUTION OF THIS AGREEMENT
(including, but not limited to, any claim against the Activant Companies Parties and/or the HM
Released Parties based on, relating to or arising under wrongful discharge, breach of contract
(whether oral or written), tort, fraud (including fraudulent inducement into this Agreement),
defamation, negligence, promissory estoppel, retaliatory discharge, Title VII of the Civil Rights
Act of 1964, as amended, any other civil or human rights law, the Age Discrimination in Employment
Act of 1967, the Americans with Disabilities Act,

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Employee Retirement Income Security Act of 1974, as amended, or any other federal, state or
local law relating to employment or discrimination in employment, including, without limitation,
the Texas Commission on Human Rights Act, the Texas Worker’s Compensation Act and the Texas Payday
Act) arising out of or relating to Your employment by the Company, the Employment Agreement, the
Option Agreement, the June 14, 1999 Stock Option Agreement between you and the Company, the Change
of Control Bonus Agreement, any other agreement between You and the Activant Companies Parties
and/or the HM Released Parties, or Your services as an officer or employee of the Company, or
otherwise relating to the termination of such employment or the Employment Agreement;
provided, however, that such general release will not limit or release the Activant
Companies Parties or the HM Released Parties from their respective obligations (i) under this
Agreement, (ii) under the surviving portions of the Employment Agreement, (iii) in respect of
claims arising solely after the execution date of this Agreement. You, ON BEHALF OF YOURSELF AND
THE EXECUTIVE PARTIES, hereby covenant forever not to assert, file, prosecute, maintain, commence,
institute (or sponsor or purposely facilitate any person in connection with the foregoing), any
complaint or lawsuit or any legal, equitable or administrative proceeding of any nature, against
any of the Activant Companies Parties and/or the HM Released Parties in connection with any matter
released in this paragraph, and represent and warrant that no other person or entity has initiated
or, to the extent within Your control, will initiate any such proceeding on Your or their behalf.

     9. You acknowledge that Section 8 of this Agreement includes a waiver or any rights and claims
arising under the Age Discrimination in Employment Act of 1967, as amended (the “ADEA Release”).
You acknowledge that the consideration that You are receiving in exchange for your waiver of the
rights and claims specified in Section 8 of this Agreement exceeds anything of value to which You
are already entitled. You acknowledge that you were advised in writing to consult with an attorney
prior to executing this Agreement. You represent and agree that You fully understand Your right to
discuss all aspects of this Agreement with legal counsel of Your choice, and, to the extent You
deem appropriate, You have fully availed Yourself of this right. You acknowledge that You have
entered into this Agreement knowingly and voluntarily with full understanding of its terms and
after having been advised and having had the opportunity to seek and receive advice and counsel
from Your attorney. You acknowledge that You have been given a period of at least twenty-one (21)
days within which to consider the release contained in Section 8 of this Agreement. You understand
that You may revoke the ADEA Release during the seven (7) days following the execution of this
Agreement and that the ADEA Release will not become effective until that seven-day revocation
period has expired (the “ADEA Revocation Period”). You agree that any modifications, material or
otherwise, made to this Agreement and the general release do not restart or affect in any manner
the original twenty-one calendar day consideration period.

     10. Effective as of the execution of this Agreement, the Activant Companies Parties and the HM
Released Parties HEREBY GENERALLY RELEASE AND FOREVER DISCHARGE the Executive Parties from any and
all claims, demands,

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liabilities, suits, damages, losses, expenses, attorneys’ fees, obligations or other causes of
action, KNOWN OR UNKNOWN, of any kind and every nature whatsoever, and WHETHER OR NOT ACCRUED OR
MATURED, which any of them have or may have, arising out of or relating to any transaction,
dealing, relationship, contract, conduct, act, or omission, OR ANY OTHER MATTERS OR THINGS
OCCURRING OR EXISTING AT ANY TIME PRIOR TO AND INCLUDING THE EXECUTION OF THIS AGREEMENT including,
but not limited to, claims arising out of or relating to Your employment by the Company, the
Employment Agreement, the Option Agreement, the June 14, 1999 Stock Option Agreement between You
and the Company, the Change of Control Bonus Agreement, any other Agreement between You and the
Activant Companies Parties and/or the HM Released Parties, or Your services as an officer, director
or employee of the Company; provided however, that such general release will not limit or release
the Executive Parties from their respective obligations under this Agreement or in respect of
claims solely arising after execution of this Agreement. The Activant Companies Parties and the HM
Released Parties hereby covenant forever not to assert, file, prosecute, maintain, commence,
institute (or sponsor or purposely facilitate any person in connection with the foregoing), any
complaint or lawsuit or any legal, equitable or administrative procedure of any nature, against any
of the Executive Parties in connection with any matter released in this paragraph, and represent
and warrant that no other person or entity has initiated or, to the extent within Your control,
will initiate any such proceeding on Your or their behalf.

     11. You agree to cooperate with the Company as reasonably directed by the Company by
responding to questions, depositions, administrative proceedings and court hearings, executing
documents, and cooperating with the Company and its accountants and legal counsel with respect to
claims and litigation of which You have personal or corporate knowledge. You further agree, except
as required by subpoena or other applicable legal process (after the Company has been given
reasonable notice and opportunity to seek relief from such requirement), to maintain, in strict
confidence, any information of which You have knowledge regarding current and/or future claims,
administrative proceedings and litigation. You agree, except as required by subpoena or other
applicable legal process, not to communicate with any parties, their legal counsel or others
adverse to the Company in any such claims, administrative proceedings or litigation except through
the Company’s designated legal counsel.

     12. EXCEPT AS EXPRESSLY PROVIDED HEREIN, THERE ARE NO WRITTEN OR UNWRITTEN, ORAL, OR VERBAL
UNDERSTANDINGS, AGREEMENTS, OR REPRESENTATIONS OF ANY SORT WHATSOEVER, IT BEING STIPULATED THAT THE
RIGHTS OF THE PARTIES SHALL BE GOVERNED EXCLUSIVELY BY THIS AGREEMENT.

     13. This Agreement may not be modified or amended except in writing signed by the parties. No
term or condition of this Agreement will be deemed to have been waived except in writing by the
party charged with waiver. A waiver shall operate only as to the specific term or condition waived
and will not constitute a waiver for the future or act on anything other than that which is
specifically waived.

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     14. This Agreement may be executed in any number of counterparts, each of which shall be an
original, but all of which together shall constitute one and the same instrument. Any counterpart
of this Agreement that has attached to it separate signature pages which together contain the
signature of all parties hereto shall for all purposes be deemed a fully-executed original.
Facsimile signatures shall constitute original signatures.

     15. All the terms and provisions of this Agreement shall be binding upon and inure to the
benefit of the parties hereto and to their respective successors and permitted assigns. Neither
this Agreement nor any rights or obligations hereunder may be assigned by You, other than by will
or the laws of descent or distribution.

     16. The Agreement and all other matters related to or arising from this Agreement shall be
governed by and construed in accordance with the laws of the State of Texas, regardless of the laws
that might otherwise govern under applicable principles of laws thereof.

     17. All provisions of this Agreement are intended to be severable. In the event any provision
or restriction contained herein is held to be invalid or unenforceable in any respect, in whole or
in part, such finding shall in no way affect the validity or enforceability of any other provision
of this Agreement. The parties hereto further agree that any such invalid or unenforceable
provision shall be deemed modified so that it shall be enforced to the greatest extent permissible
under law, and to the extent that any court or arbitrator of competent jurisdiction determines any
restriction herein to be unreasonable in any respect, such court or arbitrator may limit this
Agreement to render it reasonable in the light of the circumstances in which it was entered into
and specifically enforce this Agreement as limited.

     18. All of the parties to this Agreement were represented by counsel and this document was
negotiated by counsel, and no party may rely on any drafts of this Agreement in any interpretation
of this Agreement. Each party and counsel for each party to this Agreement have reviewed this
Agreement and have participated in its drafting and, accordingly, no party shall attempt to invoke
the normal rule of construction to the effect that ambiguities are to be resolved against the
drafting party in any interpretation of this Agreement.

     19. You acknowledge that before entering into this Agreement, You have had the opportunity to
consult with any attorney or other advisor of Your choice, and You have been advised to do so if
You choose. You further acknowledge that You have entered into this Agreement of Your own free
will, and that no promises or representations have been made to You by any person to induce You to
enter into this Agreement other than the express terms set forth herein. You further acknowledge
that You have read this Agreement and understand all of its terms, including the waiver, discharge,
and release of claims set forth in Section 8 above.

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     IN WITNESS WHEREOF, the parties hereto have entered into this Agreement to be effective as of
the date first referenced above.

	 	 	 	 	 
	 	ACTIVANT SOLUTIONS HOLDINGS INC.

 	 
	 	By:  	/s/ Richard W. Rew
 	 
	 	 	Richard W. Rew 	 
	 	 	Vice President, General Counsel & Secretary 	 
	 
	 	ACTIVANT SOLUTIONS INC.

 	 
	 	By:  	/s/ Richard W. Rew
 	 
	 	 	Richard W. Rew 	 
	 	 	Vice President, General Counsel & Secretary 	 
	 

     IN WITNESS WHEREOF, the following parties have entered into this Agreement solely for the
purposes of Sections 8, 9, and 10 to be effective as of the date first referenced above.

	 	 	 	 	 	 	 	 	 	 	 
	 	 	HICKS, MUSE, TATE & FURST EQUITY FUND

III, L.P.
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	HM3/GP Partners III, L.P.,

as General Partner
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	Hicks, Muse GP Partners,

L.P., its General Partner
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	By:	 	Hicks, Muse Fund III

Incorporated, its

General Partner
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	By:
	 	/s/ Peter Brodsky
	 

	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	Name: Peter Brodsky

Title: Partner

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	 	 	HM3 COINVESTORS, L.P.
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Hicks Muse GP Partners III, L.P.,

its General Partner
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	Hicks Muse Fund III

Incorporated, its

General Partner
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:
	 	/s/ Peter Brodsky
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name: Peter Brodsky
	 

	 	 	 	 	 	Title: Partner
	 
	 	 	 	 	 	 	 	 
	 	 	HICKS, MUSE, TATE, & FURST INCORPORATED
	 
	 	 	 	 	 	 	 	 
	 	 	BY:	 	/s/ Peter Brodsky
	 	 	 	 	 
	 	 	Name: Peter Brodsky
	 	 	Title: Partner

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Accepted and Agreed to:

I ACKNOWLEDGE THAT I HAVE CAREFULLY READ THE FOREGOING AGREEMENT, THAT I UNDERSTAND ALL OF ITS
TERMS, AND THAT I AM ENTERING INTO IT VOLUNTARILY. I FURTHER ACKNOWLEDGE THAT I AM AWARE OF MY
RIGHTS TO REVIEW AND CONSIDER THIS AGREEMENT FOR 21 DAYS AND TO CONSULT WITH AN ATTORNEY ABOUT IT,
AND STATE THAT BEFORE SIGNING THIS AGREEMENT, I HAVE EXERCISED THESE RIGHTS TO THE FULL EXTENT THAT
I DESIRED.

	 	 	 	 
	/s/
Michael A. Aviles

	 	Nov
23, 2005

	Michael A. Aviles

	 	Date Signed

	 	 	 	 	 	 	 	 	 
	 

	 	STATE OF TEXAS
	 	 	)	 	 	 
	 

	 	 	 	 	)	 	 	 
	 

	 	COUNTY OF TRAVIS
	 	 	)	 	 	 

    On this 23rd day of November, 2005, personally appeared before me, a Notary Public,
Michael A. Aviles, known (or proved) to me to be the person whose name is subscribed to the above
instrument who acknowledged that Michael A. Aviles executed the instrument.

Expiration: 5.14.07

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EXHIBIT A

     On ___, 2005, I executed a Stock Repurchase, Separation Agreement, and General
Release (the “Agreement”) by and among Activant Solutions Inc., Activant Solutions Holdings Inc.
(collectively the “Company”) and me. I was advised by the Company in writing, to consult with an
attorney of my choosing, prior to executing the Agreement. More than seven (7) calendar days have
elapsed since I executed the Agreement. I have at no time revoked my acceptance or execution of
the Agreement and hereby reaffirm my acceptance of the Agreement. Therefore, in accordance with
the terms and conditions of the Agreement, I hereby request payment of the $171,375 (which consists
of $250,000 less $75,000 for applicable Federal income taxes and $3,625 for Medicare
withholdings) in accordance with Sections 2 and 3 of the Agreement.

	 	 	 
	 

	 	 
	 

	 	Michael A. Aviles

10[ROSENTHAL & ROSENTHAL INC. LETTERHEAD]

                                                October 12, 2005

Majesco Entertainment Company
160 Raritan Center Parkway
Edison, NJ 08837

Gentlemen:

     Reference is made to the Factoring Agreement entered into between us dated
April 24, 1989, as amended and/or supplemented (the "Factoring Agreement"). This
will confirm that the Factoring Agreement is hereby amended, effective 10/17/05,
as follows:

     Paragraphs 7(a)(b) and (c) are deleted in their entirety and the following
are substituted in their place and stead:

     7. (a) The purchase price for each receivable shall be the invoice amount
of the receivable, less returns (whenever made), less all selling discounts (at
our option, calculated on shortest terms) and credits or deductions of any kind
allowed or granted to or taken by the customer at any time, and less our
commission provided for herein. No discount, credit or allowance with respect to
the receivables shall be granted by you to any customer, and no return of goods
shall be accepted by you without our prior written consent. A discount, credit
or allowance may be claimed only by the customer. All amounts collected against
the receivables shall be credited to your account adding four (4) banking days
for collection and clearance of remittances.

        (b) If you require funds from time to time, we will advance to you, at
our discretion, up to eighty percent (80%) of the net amount of receivables
purchased by us and not as yet collected. You will be charged with interest on
all sums paid, advanced or charged to you at a rate equal to eight and one
quarter percent (8.25%) per annum upon the average daily debit cash balance in
your account. The rates of interest and discount provided for in this paragraph
7 shall be increased or decreased by one quarter of one percent (1/4 of 1%) per
annum for each increase or decrease respectively of one quarter of one percent
(1/4 of 1%) per annum that is hereafter made in the prime rate of JPMorgan Chase
Bank (the "Bank") as announced by the Bank from time to time ("Prime Rate"),
such change to become effective when and as the Prime Rate shall change,
provided that at no time shall such percentage interest or discount rate be less
than 1.5% per annum above the Prime Rate. The Prime Rate may not be the lowest
or best rate charged by the Bank. Notwithstanding the foregoing, in no event
shall the rate of interest agreed to by or charged to you hereunder exceed the
maximum rate of interest permitted to be so agreed or charged under the law of
the jurisdiction whose laws are applicable to such rate of interest. We shall
have the privilege of remitting to you at any time any amount standing to your
credit on our books. Net credit cash balances arising from receivables and
remaining in your favor shall earn interest at a rate equal to two and three
quarters percent (2.75%) below the Prime Rate in effect from time to time, from
the date such net cash credit balances arise until the dates of actual payment
to you. The present Prime Rate is 6.75% per annum.

        (c) About fifteen (15) days after the end of each month, we will render
to you a statement with respect to the receivables purchased by us during the
previous month, together with advances and charges made to your account under
this Agreement. In addition to any other amounts chargeable to your account,
your account shall be charged with our expenses consisting of postage on
invoices, bank wire and similar charges and in addition all expenses and costs
from time to time hereafter incurred by us during the course of periodic
examinations of your books and records, and operations, plus a per diem charge
at our then standard rate per person, per day, for our examiners in the field
and office. Our current standard rate is $850.00 per person, per day. We may, at
our discretion, charge your account with a fee for all trial balances and sales
summaries we prepare at your request. All statements, reports or accountings
rendered or issued by us to you, including such trial balances and sales
summaries, shall be deemed accepted and be finally conclusive and binding upon
you unless you notify us to the contrary by registered or certified mail within
thirty (30) days after the date such statement, report or accounting is sent to
you.

     Except as hereinabove specifically set forth, the Factoring Agreement shall
continue unmodified.

                                        Very truly yours,

                                        ROSENTHAL & ROSENTHAL, INC.

Agreed:                                 By: /s/ Jerry Sandak
                                           -----------------------------------
                                        Name:   Jerry Sandak
MAJESCO ENTERTAINMENT COMPANY           Title:  SR Exec VP

By: /s/ John Gross
   ------------------------
Name:   John Gross
Title:  CFO

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